Who We Help · Private Schools · Cross-Border Tax
Private school cross-border tax: international fees in, US licences out
International tuition looks like cross-border income but rarely creates cross-border tax — Canada does not withhold on tuition a Canadian school receives, from any country. The border actually lives on the payment side: US curriculum licences, accreditation relationships and visiting trainers, where an HST-exempt school is both the withholding agent and the party stuck with unrecoverable tax. This is a short page because the real list is short.
By the AnalytIQ Accounting team · Last reviewed: August 12, 2026
International student fees: the work is commercial, not tax
Tuition paid by a non-resident family to your school triggers no Canadian withholding and no special CRA filing — the compliance load sits in your enrolment contracts, not the Income Tax Act. What actually needs deciding is policy: whether you price in CAD or absorb FX on USD payments, how deposits and refunds work when a visa falls through, and what you tell US parents who ask for a tax receipt. Elementary and secondary tuition is generally not deductible on a US return, and a Canadian school cannot paper it into deductibility. Faith-based charitable schools have one genuine receipting tool — CRA's IC75-23 allows the religious-instruction portion of tuition to be receipted as a donation — but that helps Canadian donors, not American ones.
US curriculum licences: the withholding belongs to you
A fee for the right to use a US program's name, curriculum or methods is a royalty: withhold 10 percent under the treaty with a Form NR301 from the licensor on file, 25 percent without one, remit by the 15th of the month after payment, and file NR4 slips by March 31. CRA collects failures from the Canadian payer, so a school that has paid gross for years has been quietly building its own assessment. Not every US education payment is a royalty, though — characterization is most of the work.
| Payment to a US provider | Withholding | Watch for |
|---|---|---|
| Curriculum or brand licence fee | 10% with NR301, 25% without — NR4 slips | Gross-up clauses that shift the tax onto the school |
| Exam and assessment fees to US boards | Generally none — service fees, not royalties | What the invoice actually licenses, if anything |
| Accreditation and membership dues | Generally none | Bundled licence rights hiding inside the membership |
| US trainer coaching your teachers on-site | 15% under Regulation 105, T4A-NR slip | Remote delivery changes the answer — nothing performed in Canada |
| Textbooks and materials shipped north | None — a customs entry, not Part XIII | Border GST that an exempt school never gets back |
Exempt tuition makes every US fee more expensive than it looks
Because elementary and secondary education is HST-exempt, a school earns no input tax credits — so the HST it must self-assess on an imported US licence, and the GST collected at the border on shipped materials, are final costs rather than flow-throughs. Budget US agreements gross: royalty plus unrecoverable tax plus any gross-up clause. A not-for-profit or charitable school layers T3010 reporting on top; a for-profit school with a US-citizen owner adds a personal IRS file that belongs beside the corporate one. We price all of it as one fixed-fee engagement — the annual compliance side lives on our private school tax services page, and the treaty machinery at cross-border tax services.
Common questions.
Do we withhold tax on tuition from US or international families?
No — tuition received by a Canadian school carries no withholding regardless of where the family lives. The withholding obligations on a school file all sit on payments going out to US licensors and trainers.
Can American parents deduct the tuition or get a usable receipt?
Generally not — K-12 tuition is not deductible on a US return, and a Canadian receipt does not change that. The IC75-23 religious-instruction receipting available at faith-based charitable schools benefits Canadian donors only.
What do we owe on our US curriculum licence?
Withhold 10 percent with a Form NR301 on file — 25 percent without — remit by the 15th of the following month, and file NR4 slips by March 31. An exempt school also self-assesses HST on the licence and cannot recover it.
Related reading
Tuition from anywhere, licences handled here.
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