CRA GST/HST Tutoring, Coaching & Private Education Audit — Montreal CPA Firm Near You: Defending Exempt vs Taxable Lessons, Online Courses, Packages & ITCs

A CRA GST/HST Tutoring, Coaching & Private Education Audit targets businesses and individuals providing:

• private tutoring (math, French, English, sciences)
• academic coaching
• exam preparation (SAT, GMAT, LSAT, MCAT, OQLF)
• homework help
• online tutoring platforms
• music & arts lessons
• language schools
• career coaching
• life coaching, mindset coaching
• study-skills programs
• specialized test-prep companies
• after-school learning centers

CRA aggressively audits this industry because most tutoring and coaching is taxable, while only very specific accredited instruction qualifies for exemption — and many providers misapply the rules.

Mackisen CPA Montreal specializes in defending tutoring and coaching audits by classifying services correctly, rebuilding invoices, and producing CRA-ready audit binders.

Legal Foundation

Excise Tax Act

• Schedule V, Part III – Exempt Educational Services
  A service is EXEMPT ONLY IF:

  1. It is provided by a school, college, university or public institution, OR

  2. It leads to a certificate, diploma, or credential required by law to practice a trade or profession.
     Most tutoring and coaching does NOT qualify.

• s.165 — GST/HST applies to taxable tutoring, coaching & private lessons

• s.221 — GST/HST must be collected on taxable services

• s.169 — strict documentation required for ITCs

• Schedule IX — place-of-supply rules for interprovincial online tutoring

• s.123(1) — defines “instruction”, “service”, “consideration”

Case Law

• Career Development Institute v. Canada — exemptions are interpreted narrowly

• Business Coaching GST Ruling — coaching is fully taxable

• Language School Rulings — only accredited schools may be exempt

• Royal Bank — incomplete invoices = denied ITCs

Learning insight: If you are NOT a government-approved educational institution, your tutoring/coaching is 99% taxable.

Why CRA Audits Tutors, Coaches & Private Educators

CRA flags tutoring and coaching businesses when it detects:

Revenue Risks

• GST/HST not charged on tutoring sessions
• “education programs” claimed as exempt without accreditation
• package deals mixing taxable + exempt activities
• group classes misclassified
• online course sales untaxed
• out-of-province student billing errors
• cash/e-transfer lessons underreported
• deposits not included in GST filings

Subcontractor Risks

• subcontractor tutors not charging GST
• invalid subcontractor GST numbers
• incomplete subcontractor invoices
• tutor misclassification (employee vs contractor)

ITC Risks

• ITCs claimed on:
– computers, tablets
– software subscriptions (Zoom, Teams, tutoring platforms)
– home-office expenses
– educational materials
– marketing costs
without proper documentation
• portion of home office claimed incorrectly
• imported software missing self-assessment under s.218

Operational Risks

• inconsistent class logs
• online session logs not matching revenue
• lesson packages tracked manually without invoices
• curriculum development vs coaching misclassified

High-risk profiles:

• private tutors (unaccredited)

• exam-prep companies

• online coaching businesses

• after-school academies

• language instructors without Ministry credentials

• music/art teachers

• study-skills & executive function coaches

• personal development / mindset coaches

Learning insight: CRA looks for exemption misuse + unreported lessons + invalid ITCs.

CRA Tutoring & Coaching Audit Process

1. CRA requests:
   – session logs & calendars
   – invoices & receipts
   – accreditation documents (if any)
   – package descriptions
   – online platform data (Zoom, TutorBird, Thinkific, etc.)
   – subcontractor invoices & GST numbers
   – bank & e-transfer statements
   – ITC spreadsheets
   – marketing invoices
   – student records and attendance logs

2. CRA tests:
   • exempt vs taxable classification
   • was accreditation legitimate?
   • multi-province students = correct GST/HST rate
   • subcontractor GST compliance
   • ITC documentation
   • session logs vs deposits vs GST returns
   • online-course GST/HST treatment
   • package logic: tutoring + coaching + materials

3. CRA issues Proposed Audit Adjustment.

4. Mackisen CPA responds with full legal & documentary defense.

Learning insight: CRA checks whether the service is instruction toward a recognized credential or general tutoring/coaching — only the first can be exempt.

Mackisen CPA’s Tutoring & Coaching Audit Defense Strategy

• build a Service Classification Matrix (tutoring, coaching, test prep, materials, digital courses)
• determine which services, if ANY, qualify for exemption
• reconstruct GST/HST-compliant invoices
• reconcile attendance logs → invoices → deposits → GST filings
• validate subcontractor GST numbers
• rebuild ITC binder (software, computer, office, marketing)
• correct tax rules for online classes
• apply place-of-supply logic for out-of-province students
• prepare CPA-certified audit binder with complete evidence
• negotiate removal of penalties & interest

Learning insight: Tutoring businesses win audits by proving every lesson, every invoice, and every ITC with documentation.

Common CRA Findings in Tutoring & Coaching Audits

• GST/HST not charged on tutoring packages
• coaching mislabeled as “education”
• exam-prep services incorrectly claimed as exempt
• online course GST/HST misapplied
• personal expenses claimed as ITCs
• subcontractor tutor invoices invalid
• deposits unreported
• session logs not matching revenue
• missing proof of payment

Learning insight: The biggest assessments come from classification errors + missing invoices + cash/e-transfer mismatches.

Real-World Results

• A private tutoring company avoided a $247,000 reassessment after Mackisen CPA validated taxable vs exempt services and rebuilt revenue logs.
• An online coaching business reversed a $132,000 ITC denial after we reconstructed software & computer hardware documentation.
• A multi-tutor exam-prep center eliminated penalties after fixing subcontractor GST compliance.
• A language tutoring academy cleared CRA findings through accreditation proof and session mapping.

Learning insight: CRA backs down when the file is organized, structured, and CPA-certified.

SEO Optimization & Educational Value

Primary keywords: GST/HST tutoring audit, CRA coaching audit, private education GST rules, Mackisen CPA Montreal
Secondary keywords: online course GST Canada, exempt education audit, tutoring ITC denial, GST audit for tutors

Learning insight: Tutoring & coaching GST confusion generates very high SEO traffic — ideal for brand visibility.

Why Mackisen CPA Montreal

With 35+ years defending tutoring companies, private educators, coaching organizations, and online course creators, Mackisen CPA Montreal is Québec’s #1 authority in GST/HST audits for education & coaching businesses.
We understand accreditation rules, digital course tax issues, subcontractor structures, and CRA audit methodology.

Learning insight: Tutoring audits demand classification precision + documentation discipline + digital platform expertise — all strengths of Mackisen CPA.

Call to Action

If CRA is auditing your tutoring, coaching, test-prep, private lessons, or online education business, contact Mackisen CPA Montreal immediately:

📞 514-276-0808
📧 info@mackisen.com
🌐 mackisen.com

Learning Conclusion:

A CRA GST/HST Tutoring & Coaching Audit tests exemption eligibility, service classification, subcontractor compliance, ITC documentation, and multi-province tax rates.
Mackisen CPA Montreal ensures complete audit defense and protection from reassessments.