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Back-to-school-related tax deductions

Student tax deductions

As students begin to pay their tuition for the upcoming fall semester, it is important to know what fees and expenses can be deducted on this year’s tax return.

While not an exhaustive list, this column will highlight some of the key deductions and credits that can help reduce your family tax bill for the 2022 filing year:

Moving expenses

A full-time student may be able to claim the expenses required to move to the education institution if they move at least 40 kilometers closer to the school. Moving expenses can include flights, rental of vehicles, and shipment of clothing and other goods to the institution.

However, moving expenses can only be claimed against the taxable portion of scholarships, fellowships, bursaries, research grants or other similar income. Moving expenses can be claimed whether the student is attending an institution within or outside of Canada. It is important to ensure that receipts are presented for the expenses claimed.

Interest paid on student loans

To cover the costs of obtaining a post-secondary education, a student may require a loan to help pay for tuition and living expenses. It is important to compare the interest rate that will be charged, and the student should also consider repayment terms, and whether the interest is deductible for tax purposes.

If the student takes out a loan under the Canada Students Loan Act, Canada Student Financial Assistance Act, Apprentice Loans Act, or any provincial equivalent, the interest paid on the loan can be deducted from their taxes. These acts generally include most provincial and federal student loan programs; however, interest paid on private loans cannot be deducted from a student’s taxes.

Finally, the interest deduction can be carried forward for up to five years, meaning if the student’s income is not high enough to make use of the deduction, they can claim it in a future tax year.

Tuition fee credit

The student may be able to make use of the tuition fee credit to reduce their taxes. Students attending any recognized Canadian education institution or an international university – in a full-time capacity for at least 13 weeks – may qualify for this credit. The financial institution will distribute a T2202 slip dictating the total amount that can be claimed as tuition for the 2022 taxation year.

Any unused tuition credits can either be carried forward or it may be possible to transfer a portion of the credits as well. Students can elect to transfer their unused tuition deduction to their parents, grandparents or partner.

Childcare expenses

A student may qualify to deduct childcare expenses if your child (or a child of your spouse or common-law partner) lives with you at the time the expenses were incurred.

Planning for School - To help reduce the cost of school, it is important for students to be aware of the credits and deductions that can be claimed when it comes to preparing their tax returns each year. A tax professional can help you and your child navigate these expenses in preparation for college or university.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Brett has worked in the financial advice industry for over 15 years and is designated as a chartered investment manager(CIM) and certified financial planner (CFP).

In 2014, Brett was appointed to the board of directors of FP Canada (the national professional body for financial planning) and spent seven years on the board, including his final two as board chair. More recently, he was appointed to the Financial Planning Standards Board (FPSB), which is the international professional body for this industry with a three-year term beginning in April 2023.

Brett has been writing a weekly financial planning column since 2012 and provides his readers with easy-to-understand explanations of the complex financial challenges that they face in every stage of life.

Enhancing the financial literacy of Canadian consumers is a top priority of Brett’s and his ongoing efforts as a finance writer and on the regulatory side through the national and global boards focus on this initiative.   

Please let Brett know if you have any topics that you’d like him to cover in future columns or if you’d like a referral to a qualified CFP professional in your area by emailing him at [email protected].


The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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