In a September 8, 2015 Technical Interpretation (2015-0584221E5, El-Kadi, Randa), CRA reiterated their position that a private school must issue T4A Slips for scholarships it awards (see Technical Interpretation 2014-0539611E5, discussed in VTN 410(9)), even when they are fully exempt from tax under Subsection 56(3).

a proactive approach to likely CRA questions

CRA noted that the school in question indicated that parents were receiving CRA requests for additional information about the scholarships the children had received. In addition to the T4A slips, the school was issuing letters to the parents to assist in responding to these enquiries, which CRA had accepted as sufficient explanation for the exclusion of the scholarships from the children’s income. CRA “saw merit” in the school’s proactive approach in issuing these letters for parents to retain in case of enquiries from CRA.