Transcript - International Students and Income Tax, Segment 13: Provincial and territorial tax and credits

Host: Welcome to the segment called Provincial and territorial tax and credits, part of the International Students and Income Tax video.

This segment mentions links where you can get more information. You can find all these links in the Related links for this segment.

With me is Nicole Bélanger. Welcome Nicole. 

Subject matter expert: Thank you, Sarah.

Host: What deductions can international students claim to reduce the amount of tax that they have to pay?

Subject matter expert: There are four types of deductions and credits that you may be eligible for.

They are: deductions from your total income, which are used to calculate your net income; deductions from your net income, which are used to calculate your taxable income; non-refundable tax credits; and federal and provincial or territorial tax credits.

This segment will focus on the refundable provincial or territorial tax credits.

Host: If I'm an international student who is a resident of Canada for income tax purposes, am I subject to provincial or territorial tax?

Subject matter expert: If you're an international student who is a resident of Canada for tax purposes, you may be subject to provincial or territorial tax for the province or territory where you resided on December 31st. For every province and territory except Quebec, you calculate your provincial or territorial tax and non-refundable tax credits on provincial Form 428.

You also may be entitled to provincial or territorial refundable tax credits. Calculate them on provincial Form 479.

You can find these forms on the CRA's website. Select your province of residence on the general income tax and benefit package page.

If you're a resident of Quebec, fill out a federal T1 income tax and benefit return for the CRA and a separate provincial return for Revenu Québec.

For more information, go to www.revenuquebec.ca.

Host: What are the differences between the provincial or territorial non-refundable tax credits and the federal non-refundable tax credits?

Subject matter expert: Generally, the provincial or territorial non-refundable tax credits are the same as the federal non-refundable tax credits. Only the amounts of the credits are different.

Host: If I'm an international student who is a deemed resident of Canada for tax purposes, do I have to pay provincial tax?

Subject matter expert: No.

As a deemed resident of Canada, you have to pay a federal surtax.

This means you're not entitled to any provincial or territorial credits.

Host: What about international students who are considered to be non-residents or deemed non-residents, do they have to pay provincial or territorial tax?

Subject matter expert: That depends on the income they are reporting.

If you're not reporting any employment income, then you complete the Income tax and benefit package for non-residents and deemed residents and you have to pay the federal surtax for non-residents and deemed residents instead of provincial or territorial tax.

If you're only reporting income from employment, then you file a return for the province or territory where you earned the income. You will be liable for provincial or territorial tax and eligible for provincial or territorial credits.

Host: What if I am a non-resident who is reporting both employment income and other income amounts?

Subject matter expert: Then you use the general income tax and benefit package for the province or territory where you earned the employment income.

You will also need to fill out Form T2203, Provincial and Territorial Taxes, Multiple Jurisdictions to calculate your tax payable.

Host: Do all provinces and territories have provincial or territorial tuition, education, and textbook amounts?

Subject matter expert: With the exception of Quebec, all provinces and territories have a provincial Schedule 11 which is used to calculate the provincial or territorial tuition and education amount.

However, only Nunavut and Yukon territories have a textbook amount, which is calculated on the Schedule 11.

You can find more information on the Quebec tuition and education amount by visiting www.revenuquebec.ca.

Host: Let's say I'm an international student who is a resident of Canada and I moved from one province to another during the year. If I had an unused provincial or territorial tuition and education amount, will I be able to use it in the new province or territory? 

Subject matter expert: Unless you moved to Quebec, you can enter your unused provincial or territorial tuition and education amount from last year on line 1 of your provincial Schedule 11.

If you moved to a new province or territory this year, with the exception of Ontario, Prince Edward Island, and Quebec, the amount you enter on line 1 will be your unused federal tuition, education, and textbook amount.

See the bottom of Schedule 11 of your new province for instructions on what to put on line 1.

Host: I heard that I can claim my rent to reduce my taxes. Is this true? 

Subject matter expert: It depends on the province or territory you live in.

Some provinces or territories, like Manitoba, have refundable tax credits, which may include a rental component.

Other provinces or territories, such as Ontario, have provincial or territorial benefit programs that the CRA manages. Some of these programs may include a rental component.

Host: Where can I learn more about provincial and territorial credits? 

Subject matter expert: You can find more information about the provincial and territorial credits on the page of the CRA's website that deals with provincial and territorial tax and credits for individuals.

If you want more information on provincial or territorial benefits programs, go to the CRA webpage called Provincial and territorial programs.

Host: Thanks, Nicole.

This concludes the segment called Provincial and territorial tax and credits, part of the CRA's International Students and Income Tax video.

Thank you for watching.

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