Are you heading off to college or university this September? If you’re moving for school take the time to see if you qualify for the moving expense credit on your taxes. Students attending school away from home, whether in Canada or abroad, may be able to deduct eligible moving expenses from their reported income when they file their taxes.
Can you claim moving expenses this year?
In general, to qualify you must satisfy these rules below:
- Attend a college, university, or other educational institution in a program at a postsecondary school level
- Be a full-time student, or taking at least 60% of the normal course load
- The new home must be at least 40 kilometres closer to the school than the old home
- The new home must be where the student lives normally, as detailed on Income Tax Folio S5-F1-C1, Determining an Individual’s Residence Status
Note: You may be able to claim moving expenses if you move overseas for post-secondary education. However, you must be considered a deemed or factual resident of Canada (In short, you must be considered a resident for income tax purposes).
Students who qualify for this credit may be able to deduct eligible moving expenses such as:
- Transportation and travel costs
- Boxes, and packaging materials
- Movers, moving vehicles
- Meals and the cost of lodging during the move (for a period not exceeding 15 days)
- Utility connection and reconnection charges
While there are an array of costs you can claim, students can only deduct these expenses from scholarships, fellowships, bursaries, or awards they must report as income. Students who work may deduct expenses from the reported income earned at their new location.
For example, say a student moves from Sherbrooke to Montreal to attend McGill full time. They land a paid internship that they plan on using to support themselves during the academic term. They can deduct moving expenses from the income earned as an intern since they moved over 40 kilometres closer to school, attend full-time, and have earned income at the new location.
However, if the student moves from a parents’ home in Montreal to an apartment closer to school, doesn’t work, or attends part-time, they’re ineligible for the credit since they haven’t moved 40 kilometers closer to school, don’t have income from which to deduct moving expenses, and aren’t a full-time student.
Also, if the student earns income only after moving home for the summer, they can’t deduct expenses from this income since it’s not earned at the new location.
These rules are a little tricky in their wording, so be sure to consult with your tax professional to confirm if you can claim your moving expenses this school year. Also, be sure to store and organize your receipts using a receipt scanner or expense tracking app
Looking for inspiration for a side gig that will help you earn cash as you study? Read our guide to self-employment.