You might be thinking that you don’t need to file your taxes as a student because you don’t earn enough or any income. Also, you probably may be thinking that as a student, filing taxes will mean you owe the Canadian Government and have to make payment. But this is not always true especially for you as a student.
In fact, you’re actually missing out on a great deal and losing an opportunity to access amazing tax benefits!
What if I tell you that by filing your tax returns yearly, you may get refunds or credits that could reduce your future tax liability? Yes, there are advantages you stand to gain if you file your taxes.
You could get;
- Tuition, Education and Textbook tax credit
- Claims on medical, childcare and/or moving expenses
- GHT/HST tax credit
- Canada training credits
- Canada employment amount
- Extra RRSP contribution room
- Other provincial tax benefits
Allow me to explain further.
1. Tuition, Education and Textbook tax credit
Any student, above 16 years, who is enrolled at an accredited post-secondary school in Canada can claim a tuition and textbook tax credit. Since this type of credits are non-refundable (not received in cash), they will be used to reduce your future tax liability.
On the other hand, textbook credit is worth$65 monthly for full-time students and $20 per month for part-time students. However, the limit of tuition credit you can claim or transfer each year is $5,000.
2. GST/HST credit
The purchasing power of a student is often limited. To help low and modest income residents like you, the government created a GST/HST credit program to help offset the goods and services tax that you pay. Want to enjoy this credit? Then you must first file your tax return! And if you qualify for this, the government will send you a cheque in the mail or directly deposit the credit into your bank account four times a year. What an incredible freebie!!
3. Medical, childcare and moving expenses
Besides your T2202 tuition tax slip for your post-secondary institution, you may be eligible to deduct some other expenses on your tax return. The most common expenses that students can claim as credits are medical expenses and donations. Moving expenses such as transportation, travel, and temporary accommodation may also be considered eligible deductions if you meet the requirements.
4. Canada Child Benefit
As a student with a child under the age of 18, you can claim the Canada child benefit (CCB). The CCB is administered by the Canada Revenue Agency, and is a tax-free monthly payment made to eligible families to help with the cost of raising children. It may also include the child disability benefit, if your child has a severe and prolonged physical or mental ailment.
5. RRSP contribution room
Retirement appears far away since you’re still young and you’ve got youthful energy. But if you start filing your taxes now, you can save a larger amount for your retirement. When you file your taxes, you build up what’s called RRSP Contribution Room. So, with each year you file your taxes, the more ‘room’ you have to save for your retirement.
Filing taxes could be complicated sometimes as a student, especially when you’re trying to manage your money. Tax experts like EMCA can help you figure it all out, so you can reap all the benefits attached to filing your taxes right.
Waste no further time today and get started with the process.