Tuition fees for students enrolled on a full or part-time basis in Canada—and, in certain instances, outside Canada—are eligible for a non-refundable tax credit, provided fees total more than $100 per establishment. Generally, a course qualifies if it is taken at the post-secondary level. Tuition fees include entrance fees, use of library or laboratory facilities, issuance of a certificate or diploma and related expenses charged to all students, other than payments to a student association. Eligible fees also include fees paid to an educational institution, a professional association or a provincial ministry or similar institution for an examination required to obtain a professional status.
Students can also claim a non-refundable education credit for each month (or part of month) of study inside or outside Canada at an accredited teaching establishment. The federal credit is 15% of $400 per month for full-time students (minimum of three consecutive weeks and 10 hours of courses per week.) and 15% of $120 per month for part-time students (minimum of three consecutive weeks and 12 hours of courses per month). Students who take post-secondary courses related to their employment can claim the education credit provided the costs are not reimbursed by their employer.
Students who are entitled to claim the education credit can also claim a non-refundable textbook credit. This credit equals 15% of $65 for each month the student is registered full-time or 15% of $20 for each month the student is registered part-time.
Where the student attends a post-secondary institution in Canada, the claims for all three credits are normally reported on Form T2202 or T2202A, which is completed by the educational institution. Where tuition fees are paid to a qualifying institution outside Canada, Form TL11A, TL11C or TL11D (depending on the circumstances) must be completed and filed with the return.
Students are entitled to carry forward unused tuition, education and textbook credits indefinitely. However, if a student is unable to use all or a portion of these credits, he or she can choose to transfer up to $5,000 (federally) to an eligible person such as a parent, grandparent, spouse or common-law partner. This equates to a $750 federal tax credit. The amount that qualifies for a provincial credit varies by province. Transfer to an eligible person is available only for credits earned in the current year. To make this designation, the student must complete and sign Form T2202 (or other eligible form), which must be made available to the CRA if asked.