Tax Tips for Students in Canada

Canada – the country of mountains, moose and flannel, welcomes a large number of international students each year, there was in fact over 336,00 international students across Canada in 2014!

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This beautiful country offers great and high quality education, as well as adventures around each and every corner – there’s a never ending list of mountains to hike, lakes to jump into and cities to explore!

Do I have to file a tax return?” you may ask, and the answer is most likely “yes”.study

Students submit their tax returns in order to receive tax credits (money and/or the chance to lower taxes later). International students may have to pay Canadian income tax on income earned from teaching and/or research assistant positions, other employment, and investment and business income. Generally, students also have to report income they receive from outside of Canada, however students from countries that have a tax treaty with Canada may not have to pay Canadian income tax and may be able to request that their employer stop withholding tax from their Canadian employment income with permission from CRA.

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But in short, you must file a tax return if you:

  • owe income tax to the government (for example, you earn an income in Canada)
  • are asked by the CRA to file a return

Even if you don’t owe any tax, you should file a tax return if you:

  • expect an income tax refund from the government
  • are applying for the GST/HST credit (which provides cash payments to low- and middle-income taxpayers, to help offset the costs of paying GST/HST on taxable purchases)
  • are eligible to receive the child tax credit (for low- and middle-income taxpayers with children)
  • might earn more income in Canada in the future and want to carry-forward (i.e. save for future years) Tuition Payment and Education Credits to reduce the tax you owe in future years.

You do not need to pay taxes on your income from scholarships, fellowships, or bursaries.

The Canadian tax system is based on residency, not citizenship, meaning you’ll have to determine your residency status before filing your tax return;

So you have now figured out your residency status, but what do you need in order to file?

  • SIN(social insurance)/ITN(individual tax) number
  • T2202A – Tuition fees paid for the tax year
  • T4 – Employment income and deductions
  • T4A – Scholarships and bursaries
  • Receipts for expenses (see below)

And last but not least – what can you claim?

  • Claim your eligible tuition fees – The fee you paid to attend your post-secondary educational institution for the tax year in question.money
  • Claim the education amount – As a full-time student you can claim $400 for each month you were enrolled in an educational institution. Part-time students can claim $120 for each month enrolled.
  • Claim the textbook amount – if entitled to this then you can claim $65 for each month you qualify for the full-time education and $20 for each month as a part-time student.
  • Claim the interest paid on your student loans – Only interest paid on loans received under the Canada Student Loans Act, the Canada Student Financial Assistance Act, or a similar provincial or territorial government law for post-secondary education can be claimed.
  • Claim the public transit amount – Keep your transit passes for local buses, streetcars, subways, commuter trains, and local ferries.
  • Claim your eligible moving expenses – To qualify, your new home must be at least 40 kilometers closer to your new school or work location.
  • Claim the GST/HST credit – If you have low or modest income, and you are a resident of Canada, you may be able to claim the goods and services tax/harmonized sales tax (GST/HST) credit.
  • Claim your child care expenses – If you have to pay for child care so you can go to school, you may be able to deduct child care expenses.

If you have any further questions o r would like some help to file your taxes – click here!

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