If you’re attending an institute of higher education, you know how your expenses can add up. And that’s what tuition tax credits are designed to help with. But sometimes you have leftover credits, so what do you do with those? Read on to find out!

Key Takeaways
  1. If you attend college or trade school, you’re eligible for tuition and education tax credits.
  2. These provincial and federal tax credits are non-refundable, meaning if the credit is more than you paid in taxes, you will not receive a tax refund check for the difference.
  3. You can transfer up to $5,000 of your unused educational tax credits for the current year to a spouse, parent, or grandparent to use instead.

What are unused tuition and education tax credits?

Tuition and education tax credits help pay you back for a portion of your higher education tuition and related educational fees.

These types of credits are non-refundable, which just means that you won’t get a tax refund if your education credits are more than the income taxes you pay. Once your taxes are reduced to zero, you may have some left over. 

So what can I do with unused tuition tax credits?

Sometimes you don’t need to claim your federal or provincial education tax credits. Maybe you didn’t make enough money to owe taxes, or perhaps other credits or deductions have already reduced your taxes to zero. When this happens, you can save the unused tuition tax credits to use in the future, or you can transfer the credits to someone else. Here are some options…

1. Carry forward unused tuition and education amounts from previous years

If you have unused education tax credits, you can carry them forward to help reduce taxes you’ll owe in future years. Each year when you file your income tax return, first you’ll use credits that were previously carried forward. Then if you have remaining taxes to reduce, you can use your current year’s credits. If they’re not needed, you can carry those forward for future use.

2. Transfer unused tuition amounts to a spouse

You’re allowed to transfer up to $5,000 of your current year’s unused tuition tax credits to a spouse or common-law partner. If you use any of those credits, that amount must be subtracted from the $5,000 total.

Let’s say you have $5,000 in credits and use $500 to reduce your income tax to zero. You could then transfer the remaining $4,500 to your wife ($5,000 – $500 = $4,500).

3. Transfer unused tuition tax credits to parents or grandparents

If you’re not married—or if your spouse or common-law partner does not claim a tax credit for you—you might choose to transfer up to $5,000 of your unused educational tax credits for the current year to a parent or grandparent to use instead. 

Where to find unused tuition credits

The best way to find your unused tuition amounts is by logging in your CRA MyAccount. You can also review the prior year’s Notice of Assessment (NOA) that was sent in the mail if you like hardcopies. 

You can look for eligible tuition credits if you’ve spent more than $100 on the following items:

  • Application and admission fees
  • Library use fees
  • Laboratory use fees
  • Computer use fees
  • Examination fees

However, you’re not able to claim tuition credits on things such as housing, food, transportation, and social activities.

It’s also good to know that many expenses associated with education can qualify for both federal and provincial tuition credits, depending on where you live. Not all provinces offer this however. Alberta and Ontario have stopped offering these credits, but students in Quebec may be eligible for an 8% provincial tax credit.

How to claim unused tuition and education amounts

Claiming unused federal tuition amounts is as simple as logging into your CRA MyAccount as previously noted. Or you can let TurboTax automatically download them for you and place them on the proper line of schedule 11.

If the process sounds a bit complicated, our tuition tax credit guide can help you even further. For new tuition and education tax credits, you’ll need the T2202 certificate from the educational facility, and for carry forward amounts, your prior year Notice of Assessment or access to MyAccount.

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