Filling Taxes as an International Student in Canada

Most students may have an idea about taxes and filling in their previous country of residence. Some may not have any idea about filing taxes but have had their parents, neighbors, and relatives talking about taxes. Amidst the excitement of studying in Canada, it’s crucial for international students to navigate the Canadian tax system effectively as it can even lead to potential refunds.  Understanding how to file taxes as an international student is not only a legal obligation but also a key aspect of financial responsibility. In this comprehensive guide, we’ll deal with things to keep in mind when filling taxes as an international student in Canada.

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Understanding Income Tax Return

Pacific Link College students are eligible to work for up to 20 hours per week during academic sessions (Now students can work more than 20hrs/week until April 30, 2024), this allows our students to get jobs and as a result be eligible to file a Canadian income tax return. Canada Revenue Agency (CRA) is in charge of income tax. Any benefit, refund, or credit payments that you may be eligible for the CRA will make sure you get it. If you work in Canada, your employer is required to deduct statutory deductions from your pay and submit these to the CRA. These statutory deductions consist of employment insurance (EI), income tax, and the Canada Pension Plan (CPP). Employers will deduct a certain amount for Employment Insurance (EI) and the Canada Pension Plan (CPP) from each paycheck. Employees are required to fill out the TD-1 (federal) and TD1-BC forms (another form according to your province) by their employer in order to deduct the appropriate amount of income tax from their salary.

You may currently be unemployed but there are many other reasons the Canada Revenue Agency (CRA) identifies why you should file taxes.

Deadline to file an Income Tax

A Canadian tax year runs from January 1 to December 31 each year and the deadline to file an income tax and benefit return is April 30 of the year after. If you owe income tax, you must pay it by April 30 for the previous calendar year.

Determining your residency status is the first step in understanding your tax obligations. This status significantly influences the way your income is taxed in the country. Your residency status is based on the residential ties you have with Canada. International students in Canada may be considered one of the following types of residents for tax purposes based on various factors.

  • resident (includes students who reside in Canada only part of the year)
  • non-resident
  • deemed resident
  • deemed non-resident

Non-residents are not eligible for benefits or credits.

Documents Required When Filling an Income Tax Return

  • Social Insurance Number (SIN) : International students with a study permit that includes a condition to work on and/or off-campus must apply to get a SIN. PLC will only ask for your SIN once, and that’s for tax purposes only.
  • T4 slip: This is a document that identifies all of the employment income and deductions made by your employer during a calendar year. You should receive this document from your employer during the tax period, if you haven’t kindly ask them.
  • Tuition receipt T2202. This identifies the number of months you attended the college and the tuition you paid. Simply email to request your T2202 Tax Form.
  • Donation receipts: If you donated to a Canadian charity to should receive donation receipts for those donations. You can Kindly ask for them as well if you haven’t received them.
  • Medical receipts for out-of-pocket medical expenses.
  • T5 slip: If you have a high-interest bank account, GIC, and/or investment, contact your financial institution for details.
  • Rent receipts from your landlord. This does not include on-campus residence fees.
  • Any correspondence from the CRA if you’ve filed taxes in Canada before, including your past notice of assessments.
  • You may have other information slips, receipts, or amounts you can indicate on your income tax return.

To learn more about taxes and what benefits you are eligible for visit the Canada Revenue Agency website.

How to file your Taxes

Students can file taxes online and by paper through mail. Filing online is the fastest and easiest way to do your taxes. It may take longer for the CRA to process your return when filling by paper.

For online tax filing, through NETFILE, the electronic tax-filling software, you may be able to submit your income tax straight to the Canada Revenue Agency (CRA) online. A NETFILE-certified tax software must be used to prepare tax returns before they may be filed through NETFILE. For paper return by mail tax filling you can find your forms and where to submit your taxes by mail on the Canada Revenue Agency (CRA) website.

Following the submission of your income tax return, the CRA should reply to you with a notice of assessment. For your records, store any correspondence you get from the CRA in a secure location.

You can open a MyAccount on the CRA website if you’ve filed at least one income tax return, gotten one notice of assessment, and have a working Social Insurance Number (SIN). With your account, you can set up direct electronic bank deposits for any refunds or benefits you may get, receive correspondence from the CRA online, and maintain your address, banking details, and personal information current with the CRA.

How can International students file taxes in Canada

  1. Students can file taxes on their own with the help of a NeTFILE-certified tax software. Note some of these software and web apps are free and some are paid.
  2. You can let someone else, like a family member or an accountant, represent you with the CRA to help manage your tax information. Make sure the individual you have selected has experience completing tax returns for international students and is reputable – if the individual is a professional.
  3. If you have a modest income and a simple tax situation, you may be able to get your taxes done by a volunteer for free through the Community Volunteer Income Tax Program (CVITP). Progressive Intercultural Community Service Society, and Sidhu Brothers Accounting Service.

It is important that you declare all of your income, from both Canadian and foreign sources. No matter where your income originates from, as a resident, you will be taxed on it all. However, you will be eligible to claim a foreign tax credit for any taxes you have paid to foreign governments.

Tax benefits you may be eligible for:

  1. GST/HST credit: is paid to individuals with low or modest incomes to help offset part of the GST/HST paid on taxable purchases (goods and services). An eligible individual may get this benefit for up to $496.
  2. Ontario trillium benefit: is paid to individuals with low or modest incomes, who are residents of Ontario, to help offset part of the Ontario sales tax on goods and Ontario property tax or rent paid.
  3.  Canada child benefit: is a tax-free monthly payment made to low or modest-income families to help them with the cost of raising children under the age 18.
  4. Disability tax credit (DTC): – eligible individuals with a disability or their supporting family member may claim $8,870 as a non-refundable tax credit. Persons under 18 years of age at the end of the year may also be eligible for an additional amount of up to $5,174.
  5. Moving expenses: You may be eligible to claim moving expenses if you moved at least 40 km closer to your educational institution.
  6. Canada employment amount: You can also claim up to $1,287 for the Canada employment amount.
  7. You can carry forward Payment and Education Credits so as to reduce the tax you owe in future years or transfer them to an eligible family member