In short
A scholarship received by a degree candidate is excluded from gross income to the extent it is used for tuition, fees, and books, supplies and equipment required for courses.
Key takeaways
- Amounts used for room, board and travel are taxable.
- Payments for teaching, research or other services required as a condition of the award are taxable as wages.
- Expenses paid with tax-free scholarships can't also be used for education credits.
Where it's tested
REG: Individual Taxation: Gross Income — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A degree candidate receives a scholarship covering tuition, required books, and room and board. Which portion is taxable?