Lesser known tax benefits for students and their families

Funding an education is expensive and important. Studies and real life experiences clearly
show that those pricy years of education will typically pay dividends in the form of more
personally rewarding and better paying jobs. At any time, and especially these days, students
and their families need to make every penny productive. Yet many overpay their taxes because
they overlook lesser known tax benefits like these.

Tax deductions for students
• Full time post secondary student who move to go to school may be able to claim movingexpenses.
• Students may deduct expenses from scholarships, bursaries, research grants and
employment or self-employment income.
• Child care expenses may be claimed by the higher earning spouse when the lower
earning spouse is enrolled in either secondary or post-secondary education. Limits
increase for a single parent or when both members of a two parent family are attending
school full time.

Tax credits for students
• Canada employment credit – available on the first $1,000 of employment income.
• Tuition fees credit – for fees of over $100 per year paid to a Canadian university,
college or other educational institution; if attending school outside Canada, the
student must be enrolled in a university course of 13 weeks or longer leading toward
a bachelor degree or higher.
• Education and textbook credit – available to students enrolled in a qualifying
education program at a university, college or other designated educational institution.
o Unused tuition, education and textbook credits may be carried forward by the
student for use in future years or transferred to a spouse, supporting parent
or grandparent to a maximum of $5,000 minus the amount used by the
student.
• Public transit credit – available for monthly or longer public transit passes; parents
may claim for a dependant under 19.
• Student loans interest – must be claimed by the student; unused claims can be
carried forward for five years.

Other tax efficient approaches for financing an education can include making an interest-free
loan to a student and using the right Registered Education Savings Plan and Lifelong LearningPlan withdrawal strategies. Nova Scotia, Saskatchewan and Manitoba have also introduced tax
credit programs for the recovery of tuition fees after graduation if the graduate stays in the
province.
Talk to your professional advisor about the best ways to get the biggest bang for all your
education bucks.

Editor's Note: http://www.investorsgroup.com/
This column, written and published by Investors Group Financial Services Inc. (in Québec – a Financial

Services Firm), presents general information only and is not a solicitation to buy or sell any

investments. Contact a financial advisor for specific advice about your circumstances. For more

information on this topic please contact your Investors Group Consultant.