Tax considerations for local and international students.
September 1, 2022
Whether you’re a full or part-time post-secondary student, you’re entitled to unique credits that can help increase your refund or reduce the taxes you owe when you file your return. If you're a student, make sure you're taking advantage of all the available credits and deductions to get you the refund you deserve.
Here are some things to keep in mind when filing your taxes.
Taxable income as a Canadian student.
Full-time students are not exempt from paying income tax in Canada. If you received any income from summer jobs or part-time jobs, you need to file an income tax return. All money you received regardless of if that work was occasional, part-time, or full time, is considered employment income. This also includes any tips you collected while on the job. Other forms of taxable income include any interest received from a Registered Education Savings Plan (RESP). Scholarships, bursaries and grants are generally exempt.
Remember to claim your federal tuition tax credit.
The federal tuition tax credit is one of the top tax credits for post-secondary students. Even if you aren’t reporting any income on your tax return, you can use this credit to claim the eligible tuition fees for post-secondary level courses. You can also claim fees you paid to an educational institution to take a course for developing or improving your skills in an occupation (if that institution is certified by Employment and Social Development Canada), as well as fees to take an occupational, trade, or professional exam.
Claim the interest you paid on your student loans.
When you repay your student loans, you are able to claim the interest as a non-refundable tax credit to help reduce any taxes owed.
Transferring unused credits.
If you have unused tuition tax credits for the current tax year, you can carry them forward to claim in future years. The caveat is that you must claim your carry forward amounts in the first year that you have to pay income tax. Another option you have is to transfer up to $5,000 to qualifying relatives such as parents, grandparents, spouses, and common-law partners.
Student moving expenses.
If you moved at least 40 kilometres away from home to get a summer job, you might be able to claim your moving expenses. This includes what you paid for transportation, storage, travel, temporary living, and more. You may also claim moving expenses to take courses as a full-time student in a post-secondary program, but only if you have taxable scholarship income (which is not usually the case).
International Students Studying in Canada.
The Canadian tax system is based on residency, not citizenship. If you received Canadian-source income (such as employment income from a Canadian employer) and/or are considered a resident, you’ll need to file a tax return.
International students who want to claim tax credits or deductions they may be eligible for such as GST/HST credits, tuition-related tax credits and other provincial credits or tuition rebates also need to file a tax return.
We know that doing your taxes can be complicated, but the good thing is H&R Block Tax Experts know the ins-and-outs of student tax filing and can help make sure you claim all the credits you’re entitled to. If you need help, you can choose from one of four convenient ways to file: File in an Office, Drop-off at an Office, Remote Tax Expert, or Do It Yourself Tax Software.