We think it’s awesome that you chose Canada as a destination for your education, and hope you’re enjoying every moment in our country. What’s not to love? There’s hockey, snow…Timbits. We also love doing our taxes, so you might be wondering if you should be filing a return, too. The answer to that question depends on a few things, like whether you’re considered a resident, what income sources you have, and the duration of your stay. Keep reading to see if you should be filing a return.
You need to file if: you’re considered a resident
How do you know if you’re a resident in the eyes of the Canadian government? Students like yourself would need to show residential ties in Canada, and here are a few things that establish these ties:
Owning or renting a home here
Having a spouse, common-law partner or dependants move to Canada with you
Obtaining a health card or driver’s license, and other secondary ties
Most students will usually retain residential ties with their home country, and if that’s the case for you, there is probably a tax treaty in place with your country that has a set of tie-breaking rules to settle the issue. There are now very few countries that we don’t have a tax treaty with, but residency status can change from year to year. Make sure you consult the Canada Revenue Agency’s (CRA) guidelines to help determine your official status.
You need to file if: you spend a lot of time here and we don’t have a tax treaty with your country
If you spend more than 183 days in Canada in a calendar year, and we don’t have a tax treaty with your home country, the CRA might consider you a resident and you’ll be expected to pay taxes.
You don’t need to file if: you go home regularly and aren’t a resident
If you don’t have residential ties to Canada, and return to your home country on a regular basis or for long amounts of time during the calendar year, the CRA is unlikely to consider you a resident of Canada.
You need to file if: you worked while you were here
Even if you are considered a non-resident, any Canadian-source employment income must be reported on an income tax return. This includes part-time jobs, seasonal work and any taxable parts of Canadian scholarships, grants or bursaries. If it comes from a Canadian source, it’s considered income that must be reported on a tax return. You should receive a T4 from your employer showing the amount you earned and the CRA will receive one automatically as well.
No Canadian income? Not a resident? Here’s the deal with tuition credits
A common misconception among non-resident students that don’t have Canadian-earned income is that they can claim tuition credits on their income tax return to carry forward for future years. Only students who have a Canadian source of income, or are considered residents in the tax year can claim tuition credits (even if they remain in Canada to work and file returns in the future). Only students who are considered residents in the eyes of the CRA can access social benefits, like the GST credit.