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Useful information and options to help with education-related costs.

For many students, tax planning may not rank very high on the list of priorities. However, when you consider that taking advantage of tax credits and deductions is very beneficial in helping students stretch their funds while in school, it makes sense to learn and understand the options out there. This checklist provides a useful quick reference for the most-common federal tax credits, deductions, and tax-assisted programs available to students.

  1. Tuition fees – Some students may be eligible to claim a 15 percent tax credit of qualifying tuition fees.
  2. Education amount* – Full-time and part-time students may be entitled to an additional 15 percent tax credit of $400 per month or $120 per month, respectively.
  3. Textbook amount* – Those who qualify for the education amount may be entitled to a 15 percent further textbook credit of $65 per month for full-time students or $20 per month for part-time students.
  4. Transfer or carry forward unused tuition, education, and textbook credits – Students who can’t use all of their tuition, education, or textbook credits may be able to transfer up to $5,000 to a spouse, common-law partner, parent, or grandparent.
  5. Interest on student loans – Some students may be eligible for a 15 percent tax credit for the amount of interest paid on certain student loans.
  6. Scholarships, fellowships, bursaries, and study grants* – These amounts are likely tax-free for those who qualify for the full-time education amount tax credit. A partial exemption is available for those who don’t qualify for the education amount.
  7. Moving expenses – If a student moves to be at least 40 kilometres closer to their new educational institution or place of work, they may be able to deduct moving expenses.
  8. Childcare expenses – In certain situations, students, or their higher-earning spouse, may be entitled to deduct eligible childcare expenses.
  9. Lifelong Learning Plan (LLP) – The LLP allows a Canadian resident to withdraw up to $20,000 from their RRSP with no immediate tax consequences. Amounts not repaid over the required 10-year period will be taxed as income.
  10. Research expenses – The research expenses students incur may be used to reduce the amount of taxable research grants received.
  11. Educational assistance payments (EAP) – EAP received from an RESP is taxable to the receiving individual. Original contributions withdrawn from an RESP are not taxable.
  12. GST credit – Someone who is 19 years of age or older may be eligible for the GST credit simply by filing a tax return.
  13. Public transit amount – Students may be able to claim a tax credit for the cost of public transit passes.
  14. Canada employment amount – Certain employed individuals (e.g., those in a co-op position) may be eligible to claim this tax credit.

*Federal budget 2016, once enacted, will eliminate the education and textbook amounts after December 31, 2016. Changes will be introduced to the criteria that allows scholarship, bursary and study grant income to remain tax-free.

This document has been prepared for use by the RBC Wealth Management member companies, RBC Dominion Securities Inc.*, RBC Phillips, Hager & North Investment Counsel Inc., RBC Global Asset Management Inc., Royal Trust Corporation of Canada and The Royal Trust Company (collectively, the “Companies”) and their affiliate, Royal Mutual Funds Inc. (RMFI). *Member – Canada Investor Protection Fund. Each of the Companies, RMFI and Royal Bank of Canada are separate corporate entities which are affiliates. “RBC advisor” refers to Private Bankers who are employees of Royal Bank of Canada and licensed representatives of RMFI, Investment Counsellors who are employees of RBC Phillips, Hager & North Investment Counsel Inc. and the private client division of RBC Global Asset Management Inc., Senior Trust Advisors and Trust Officers who are employees of The Royal Trust Company or Royal Trust Corporation of Canada, or Investment Advisors who are employees of RBC Dominion Securities Inc. In Quebec, financial planning services are provided by RMFI which is licensed as a financial services firm in that province. In the rest of Canada, financial planning services are available through RMFI, Royal Trust Corporation of Canada, The Royal Trust Company, or RBC Dominion Securities Inc. Estate and trust services are provided by Royal Trust Corporation of Canada and The Royal Trust Company. If specific products or services are not offered by one of the Companies, clients may request a referral to another RBC partner. The strategies, advice and technical content in this publication are provided for the general guidance and benefit of our clients, based on information believed to be accurate and complete, but neither the Companies, RMFI, nor Royal Bank of Canada, nor any of its affiliates nor any other person can guarantee accuracy or completeness. This publication is not intended as nor does it constitute tax or legal advice. Readers should consult a qualified legal, tax or other professional advisor when planning to implement a strategy. This will ensure that their individual circumstances have been considered properly and that action is taken on the latest available information. Interest rates, market conditions, tax rules, and other investment factors are subject to change. This information is not investment advice and should only be used in conjunction with a discussion with your RBC advisor. None of the Companies, RMFI, Royal Bank of Canada nor any of its affiliates nor any other person accepts any liability whatsoever for any direct or consequential loss arising from any use of this report or the information contained herein. In certain branch locations, one or more of the Companies may carry on business from premises shared with other Royal Bank of Canada affiliates. Notwithstanding this fact, each of the Companies is a separate business and personal information and confidential information relating to client accounts can only be disclosed to other RBC affiliates if required to service your needs, by law or with your consent. Under the RBC Code of Conduct, RBC Privacy Principles and RBC Conflict of Interest Policy confidential information may not be shared between RBC affiliates without a valid reason.

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