Let's face it. . .we all appreciated the support we got from family when we were struggling students. Under the Income Tax Act, those kind family sacrifices can bring financial rewards.
This works if the student does not have sufficient income to use the tuition, education, and textbook amounts earned in the current year. In that case, a portion of the unused amounts may be transferred to a cohabiting spouse or common-law partner.
If the taxpayer does not have a spouse or common-law partner or the person's spouse or common-law partner is not claiming the taxpayer as a dependant, then the unused amount may be transferred to the taxpayer's parent or grandparent or to the spouse's parent or grandparent.
The maximum amount that may be transferred is the lesser of
Provincial credits. You should also know that the tuition, education, and textbook amounts at the provincial level may not correspond to the federal amounts, so a separate provincial Schedule 11 may be required when you file your tax return. In addition, the unused tuition, education, and textbook amounts carried forward may be different at the federal and provincial level.
Correcting Errors and Omissions. If you made mistakes claiming your entitlements or missed them entirely, know that you can adjust federal returns for a period of 10 years in the past. Provincial adjustments can generally be made for a period of only three years. Check out the tax advantages of going to school with your tax and financial advisors.
It can make a big difference to cash strapped students and their families. Happy studying!
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