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Know the tax facts

For students trying to file their own taxes this season, tuition and education credits can be problematic.

Eric Manarintar, a volunteer with SAIT’s community volunteer income tax program, estimates about 80 per cent of students don’t know what to do with their tuition and education amounts when filing their taxes.

The issue appears when students decide to claim their tuition and education amounts for themselves in a year that doesn’t actually benefit them, and they end up losing the potential tax credits.

Radha Ganefan, a tax professional from H&R Block’s Brentwood office, says “students should not use their tuition and education amounts for themselves in a year when they do not owe taxes. They should transfer them forward or give them to a relative to use.”

If you’re single, you can transfer the unused portion to a parent or grandparent who actually does owe tax money. If you’re married or living in a common-law relationship, you may transfer the credits to your spouse or common-law partner. The maximum amount that can be transferred is $5,000 per year.

If you cannot fully utilize your tuition fee and education amount, you have the option of carrying forward the unused portion and applying it against income in future years.

“When students start working and getting a salary,” Ganefan said. “It’s very beneficial to use the amounts they’ve carried forward from last year against their taxable income.”

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