Canada welcomes many international students every year. Something not all of these academic globetrotters might know, however, it that as an international student, you may need to file a Canadian tax return. To determine if this is something required of you, there are a few different factors to consider.
Residency Status
The first factor is determining whether an international student qualifies as a Canadian resident. To do this, students need to show that they have residential ties to Canada.
There are a variety of criteria that the Canada Revenue Agency (CRA) considers when determining residency. Some of these factors include:
- having a spouse, common-law partner or dependants move to the country with you
- obtaining a Canadian driver’s licence or health card
- opening an Canadian bank account
- filing for a credit card
- purchasing property.
Factors that would suggest you do NOT have residential ties would be:
- returning to your home country periodically for a significant amount of time, or…
- moving to another country while not attending school in Canada.
Weighing these factors, the CRA will determine if you are considered a resident, non-resident, deemed resident or deemed non-resident.
Resident or Non-Resident
- A resident of Canada is someone who has established residential ties to the country.
- A non-resident would classify as anyone without such ties, and who resides in Canada for less than 183 days of the year.
Deemed Resident or Deemed Non-Resident
A deemed resident is someone who doesn’t have significant residential ties in Canada, but stays there for 183 days or more during a calendar year. Deemed residents also shouldn’t be considered residents of their home country under the terms of any tax treaty between Canada and that country. Residents and deemed residents are both responsible for paying Canadian taxes.
If you are an individual who has established significant residential ties with Canada and are considered a resident of another country with which Canada has a tax treaty, you might be counted as a deemed non-resident of Canada for tax purposes. Both non-resident and deemed non-residents are required to pay tax on income you receive from Canadian sources; taxes are dependant on the type of income you receive. This income could include investment earnings such as interest or dividends, as well as any employment wages garnered through the likes of a part-time job, seasonal work or taxable scholarships.
Other Benefits and Filing Information
If you are an international student with Canadian source income or are considered a resident, then you can claim tuition credits and are eligible for benefits such as the Harmonized Sales Tax (HST) Credit.
If you are new to Canada and are filing your taxes for the first year, be sure to indicate the date you first arrived. This will result in a proration of credits for the overall tax year, as you were not a resident for the full year. If you are a non-resident or a deemed non-resident and you do not have any Canadian source income, then you are not required to file a Canadian tax return.
If you are a non-resident of Canada, you can’t use the NETFILE service to submit your return electronically. Instead you must print and mail your return.
References & Resources