Understanding Tax Refunds as a Canadian Student
Canadian students working remotely in their country overseas are often owed large tax refunds. In fact, the average Canadian tax refund is CAN$998.
That’s certainly an amount you wouldn’t want to leave behind!
A tax refund can be useful to students, especially for some summertime adventures!
File your Canadian Tax Return easily online
Why Canadian students could be due a tax refund
Student tax refunds are often big because many students usually work part-time or they work for some of the year. This means they might have overpaid income tax, Canadian Pension Plan or Employment Insurance.
Income Tax
If you work in Canada, there are two income taxes you need to know about - provincial and federal.
So there are the federal tax rates as well as the rates from the province you live in that will apply to you.
Note: the more you earn, the more tax you will pay.
Ready to claim a tax refund from Canada?
Canadian Pension Plan (CPP)
In Canada, you’ll need to contribute to the CPP if:
- You’re over the age of 18 and work
- You make more than the minimum amount per year - $3,500
- You work outside of Quebec (Quebec has the Quebec Pension Plan (QPP))
The contribution you make depends on your income.
For 2024, if you earn under $55,867 a year the tax rate for you is 15%, whereas if you make over $55,867 you will be taxed 20.5%.
How much tax refund will I get in Canada?
Employment Insurance (EI)
Whether you were out of work or ill and received employment insurance payments you will have to pay taxes on the amount you received.
If you received EI, you will be issued a T4E or a T4EQ if you live in Quebec. You will need to include this slip when you’re filing your tax return.
Student expenses that could be included in the return
As a student, you can claim money on your Canadian tax return from:
- Educational expenses, such as tuition fees
- Student loan interest
Tuition fees
Paying tuition fees can often be costly but thankfully you may be eligible for tuition tax credits which can significantly lower your tax bill!
To qualify for tuition tax credits you:
- Need to be 16 years of age or older
- Have to be registered with a Canadian post-secondary education institution
Do I have to be a full-time student to be eligible for tuition tax credits?
In short, no. Regardless of whether you are a full-time or a part-time student, you may be eligible for tuition tax credits.
Read also: Tax Facts for International Students in Canada
File your Canadian Tax Return easily online
Student loan interest
Borrowed a student loan for your education? There is the student loan interest deduction which deducts money from the interest you paid on your loan.
You will be issued a 1098-E by the company that lent you the money.
The amount that can be deducted from your income tax is $2.500 which can make a big difference to your tax bill!
Ready to apply for your Canadian tax rebate?
If you studied there last year or anytime in the last 4 years apply for a Canada tax rebate now.
Are you a Canadian student studying abroad? We’ve got you covered!
Canadians studying abroad can also get foreign tax refunds from the countries they are working and studying in. International tax law is complicated though so it's best to use a professional, global tax refund service provider like Taxback.
We can help you file your taxes in the following countries:
- Australia
- Belgium
- Denmark
- Germany
- Ireland
- Japan
- Luxembourg
- Netherlands
- New Zealand
- UK
- USA
It's always a good idea to file a student tax return wherever you're working as a bad tax record can affect your visa applications in the future.
File your Canadian Tax Return easily online
What do Taxback offer?
- Stress-free online service
- We will ensure you get your maximum legal refund
- We have a customer support 24/7 for any of your tax questions
- No fee, no refund policy
In summary, Canadian students working overseas can claim substantial tax refunds. By understanding the tax system and leveraging deductions for educational expenses and student loan interest, they can maximize their returns. Utilizing professional services like Taxback ensures a smooth process and compliance with international tax laws. Don't miss out on what you're owed – seize the opportunity for financial gain.
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