What is the education amount?
Students ask us if they can claim food plans and residence fees on their tax returns. In most cases the answer is no, but the education amount is meant to help offset some living expenses like housing and food.
Post-secondary students enjoy some of the most generous tax credits available. And even if they can’t use them right away, they are allowed to carry forward unused amounts for the future or transfer credits to a spouse, parent or grandparent.
Students are allowed to claim the education amount for each month they are in school. This credit is meant to provide some help with the living expenses involved with going to school, but it is a flat-rate amount, dependent on the hours you spend in classes. Students often ask if they can claim their rent, food or residence fees as part of their education credits. The answer is usually no. Ontario and Manitoba have rent credits but these are not unique to students.
Full-time students can claim $400 per month and part-time students $120 per month. The number of months you are allowed to claim is indicated on your T2202A Form. Remember, your tax return is for the calendar year, so if you attended school from September to December, your T2202A Form will indicate four months. And you can claim partial months if you started late or finished early.
The education amount is a non-refundable credit. That means being in school for eight months does not result in a $3,200 refund. Instead, the amount is calculated by multiplying the total by 15 percent. So, being in school full time for eight months will result in about $480 in tax savings ($400 x 8 x 15%).
Remember, you can only receive a tax refund if you have paid taxes during the year. If you don’t use the education amount on your return, you can carry it forward along with your unused tuition fees to use in years when you are earning more money. The carry-forward amount should be on your Notice of Assessment.
Even if you are working while going to school, you can claim the education amount if you are taking a course related to your job. But if your employer paid for your course, then you are not allowed to claim the education amount. Other students who may not be able to claim the amount include grant recipients (other than recipients of grants under a federal or provincial student loan program), students who receive a benefit as part of their program or someone who received an allowance.
Senior tax pro and national spokesperson