Canadian Taxes on Stipend

[vern23]

So I just thought of this now. I'm accepted to a canadian program and they guaranteed funding. Few issues though, the stipend amount for RA/TA isn't huge, especially for a big expensive city and they dont waive tuition which is a big junk there. So my question is does anyone know how much will be taken out of this money for canadian income tax? I don't know how the canadian system works for that.

[ogopogo]

I'm not really sure about international students but, as far as I know, if you are an official resident of Canada you will pay taxes on TA or RA work, but not on scholarships. You will almost certainly fall into the lowest tax bracket (15% + provincial tax), and expenses such as moving to attend school, tuition, a certain amount of textbooks, etc. are deductions that most students can claim. More info for students can be found here: http://www.cra-arc.gc.ca/tx/ndvdls/sgmnts/stdnts/menu-eng.html, especially in the income and deductions sections, and the international students section.

[lewin]

Scholarships and bursaries are tax free. Anything that's employment (TA/RA) is taxable but the tax credits received from tuition, textbooks, and student status will more than outweigh any taxes you might need to pay. For example, you can claim all of your tuition and (typically) $400 per month tax credit for each month you're a full-time student. Just be sure to fill out your T1 properly when you start employment so they don't deduct too much off of each paycheque.

T1 is the tax form where you estimate how many credits you'll have each year so that your employer deducts an appropriate amount for income tax each month. At the end of the year, on your tax return, you reconcile how much you actually made, how many credits you actually have, and how much tax you paid; usually this results in a refund.

(This is the process for Canadians; it may be different for international students.)