Student Tax Credits: Tuition, Education, and Textbook Amounts – A Complete Guide by a Montreal CPA Firm Near You

Student tax credits in Canada provide valuable financial relief to students and parents

by reducing the amount of tax owed and creating carry-forward amounts for future

years. Many students pay significant tuition fees but do not understand how to properly

claim them or how unused credits can be transferred to a parent, spouse, or

grandparent. Although federal education and textbook credits have been eliminated, the

tuition tax credit remains one of the most important student tax credits in Canada.

Students who file correctly can reduce their current tax to zero, preserve unused credits

for future income, or transfer credits to help reduce a family member’s tax bill. This

guide explains how student tax credits work, what qualifies as eligible tuition, what

documentation CRA requires, and how to properly transfer or carry forward these

important credits.

Legal and Regulatory Framework

Student tax credits in Canada are governed by section 118.5 of the Income Tax Act,

which defines eligible tuition fees and outlines the requirements for claiming the tuition

tax credit. To qualify, tuition must be paid to a designated educational institution for post-

secondary courses or to certified institutions offering occupational training. Tuition

receipts must include the tax year, institution name, student identification, and the

amount paid. CRA requires Form T2202 (Tuition and Enrolment Certificate) for

Canadian institutions, and Form TL11 for tuition paid outside Canada. Federal

education and textbook credits were eliminated in 2017, but many provinces—including

Québec—still offer provincial equivalents. Tuition credits can be carried forward

indefinitely or transferred up to a maximum amount each year to a spouse, parent, or

grandparent, provided the student does not need the credits to reduce their own tax

liability. These regulations ensure proper claim accuracy for student tax credits in

Canada.

Key Court Decisions

Court cases illustrate the importance of proper documentation and compliance when

claiming student tax credits in Canada. In Dhaliwal v. Canada, CRA denied tuition

credits because the student failed to provide a valid T2202 form; the court upheld the

decision, emphasizing strict documentation requirements. In Liu v. The Queen, the court

confirmed that only eligible tuition—excluding ancillary fees not directly tied to

instruction—qualifies for the tuition credit. In Rezaei v. Canada, CRA denied a tuition

transfer because the student attempted to transfer credits that should have been used

to reduce her own tax first; the court affirmed that transfer rules must be followed

precisely. These decisions highlight that CRA enforces exact compliance when

taxpayers claim student tax credits.

Why CRA Targets This Issue

CRA frequently reviews tuition claims because millions of students file tax returns each

year, and errors are common. Issues include claiming ineligible courses, using outdated

receipts, misreporting tuition amounts, or attempting to transfer credits improperly. CRA

also monitors situations where institutions are not recognized or where foreign tuition

claims do not meet criteria. Another common issue is students failing to file a return at

all, which prevents tuition credits from being officially recorded and carried forward.

Because student tax credits in Canada have a substantial impact on tax liability and

future years’ planning, CRA carefully reviews claims for accuracy and legitimacy.

Mackisen Strategy

At Mackisen CPA Montreal, we help students and families maximize their tuition credits

while staying compliant with CRA rules. We begin by verifying the T2202 or TL11 forms,

ensuring all eligible tuition amounts are included and correctly reported. Our team

analyzes the student’s income for the year to determine whether credits should be used

immediately, carried forward, or transferred. When a student has zero tax payable, we

strategically carry credits forward to future high-income years. For families, we calculate

whether transferring credits offers the greatest benefit and ensure the transfer does not

exceed the annual maximum. We also assist with complex cases involving foreign

schools, provincial differences, and multi-year education programs. This approach

ensures students receive the full benefit of student tax credits in Canada while

maintaining compliance.

Real Client Experience

A student enrolled in a Québec university brought us a T2202 slip that did not match the

amount CRA had recorded. After verifying the breakdown, we discovered the institution

had issued an updated form. We refiled the return and corrected the credit. Another

client studying abroad attempted to claim tuition without proper TL11A certification. We

coordinated with the foreign institution, secured the correct documentation, and

obtained CRA approval. A third student transferred credits to a parent without realizing

they needed to first apply them to their own small tax balance. CRA rejected the

transfer. We filed an adjustment with proper calculations, and CRA accepted the

corrected allocation. These cases illustrate how professional support can prevent errors

and maximize student tax credits in Canada.

Common Questions

Many students ask whether part-time courses qualify. Part-time courses are eligible if

offered by a designated institution and if tuition exceeds the minimum required amount.

Another common question is whether international students can claim tuition credits.

Yes, if they attend a designated institution and pay eligible tuition. Students often ask

whether they need income to claim credits. They do not; even students with no income

should file a return so credits accumulate for future years. People also ask how many

credits can be transferred. Students may transfer up to a limited amount each year,

provided they do not need the credits to reduce their own tax to zero. These questions

highlight the importance of understanding the rules before claiming student tax credits.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps

Canadians stay compliant while recovering the taxes they’re entitled to. Whether you

are claiming student tax credits in Canada, transferring tuition credits, or managing

multiple years of education-related deductions, our expert team ensures precision,

transparency, and protection from audit risk.