AP Tax Group: Back to School Tax Credits

As the leaves start to fall and students start to dread

the approaching school

year, life gets inescapably busy. The summer always

seems to fly by and when

September hits, parents of post-secondary students

find themselves frantically

moving their kids into

dorms and shelling out cash for textbooks. With all

of this chaos, many people forget to keep track of some important receipts and

come tax time, they lose out on some great school tax credits and tax deductions.

Post-secondary students can claim their tuition fees to receive a tuition tax credit and need either an official tax receipt or a completed form T2202A to do so. This

tax credit is fairly straightforward and is commonly transferred to a student’s

parents if their income isn’t very high or if the parents are the ones footing the

educational bill.

Note: If there are any student loans involved, you might want to become familiar with the rules for claiming interest paid on student loans for after the schooling is

finished.

Paying to take an exam or to receive a license in order to practice a certain

profession or trade in Canada might be eligible for the tuition tax credit as well. There are some exceptions if you are being reimbursed by an employer, so make

sure to check with your accountant before you file your tax return.

If a student has to move in order to go to school (at least 40 km closer than their

previous home), they can claim their moving expenses. Unfortunately, claiming

moving expenses for school isn’t exactly as helpful as it is for work. A student can only deduct their moving expenses from the money they receive as a result of

attending school and would have to claim as income.

In other words, if a student receives a bursary or a research grant and has to move

to another location to complete their educational commitment, they can deduct

their moving expenses from that income.

Even though textbooks range in price dramatically from faculty to faculty, the CRA

handles textbook tax deductions in a one-size-fits-all approach. You can claim $65

per month for full-time studies and $20 for part-time. Your accountant will use your

Schedule 11 to figure out exactly how much you can claim.

Make sure to keep all of these school tax credits and deductions in mind as the

weather cools and the semester starts up. You will reap the benefits at tax time!

If you have any questions, please feel free to contact us. We are tax specialists and

would be happy to meet with you.

-See more at: AP Tax Group