Even if you have little to no income in the year, filing a tax return has its advantages – it’s the only way to receive all the benefits that are available to you.
If you worked last summer and tax deductions were made from your paycheque, you can probably recover most of the tax, and some of the CPP premiums, when you file your return. If your net income is low enough, you may even be able to save your parents some taxes. To maximize the savings, take advantage of as many deductions as you can, but do not waste any that are available to you. The tuition fees, the education amount and the textbook tax credit that you do not need this year, can be transferred. If you prefer, they can also be carried forward through your tax return, so that you can use them in a future year when your income is higher.
Scholarships, Grants and Student Loans
Student loans, of course, are completely non-taxable. You can even claim a tax credit on the interest when you begin paying back the loan.
Deducting Your Moving Expenses
These expenses are deductible if your residence is at least 40 kilometers closer to your new school that your old residence was. However, they can only be deducted against either employment income at your new location or, when you are moving to go to school, against award income such as fellowships, bursaries, scholarships and research grants.
Moving expenses include transportation costs such as your plane ticket. If you used your car, you can claim gas expenses and the cost of any meals and lodging en route. Also deductible is the cost of up to 15 days of temporary accommodation near your new or old residence. Receipts need to be filed with your return, but should be kept in case the Canada Revenue Agency (CRA) asks to see them later.
Claiming Your Tuition Fees
Textbook Tax Credit
$65 for each month the student qualifies for the full-time education amount; and
$20 for each month the student qualifies for the part-time education amount.
Proof that textbooks have actually been purchased is not required.