Some people wonder – can you claim your graduate retention rebate first, and hold all or part of your tuition and education tax credits until after the 6 year retention rebate expires?  To which I can only respond:  I wish.

The real answer is no, you can’t.  You are required to use your tuition credits first, which is a bit disappointing, because many graduating students have sizeable carryforwards of tuition costs.  It often takes several years to “sop up” these tuition carryforwards.  By the time they are used up, you’ve already eaten up some or all of the 6 years of the retention rebate.  This means you don’t get the full benefit of the graduate retention rebate.

The best way around this is to transfer the maximum allowable portion of your tuition and eduction tax credits to someone else (and then hope they share the tax savings with you!) …… but you can only do this in the year you receive the credits.  You can’t transfer carryforward amounts.

 

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Graduate Retention Rebate


July 6th, 2012

This article was written for the Business First publication, and is part two of a series.  You can read the first one here.

 

Don’t you love that feeling you get when you finally finish a task you’ve been dreading?  And you find out it wasn’t nearly as bad as you were expecting?  Sort of like cleaning up the garage and rather than taking a whole day it only takes most of the morning.  Or better yet, you clean up the garage and find that tool you’ve been missing for three months.  Which is great unless that tool happens to belong to your father whose been missing it for three months.

In last month’s issue of the Business First magazine, we wrote about Raymond, the apprenticed electrician who was attending trade school.  In that article, Raymond was pleased to learn about how he qualified for apprenticeship grants of up to $4,000.  His employer was also very pleased to receive tax credits of an additional $4,000.

Raymond has now finished trade school and is a licensed electrician.  He graduated from the Nova Scotia Community College, and was hired full time with Coastal Electrical.  His employer has been busy re-wiring several large superstores throughout Nova Scotia, and Raymond has been kept very busy.  In fact, he was worked quite a bit of overtime.  Since this is his first full year out of school, Raymond is getting quite worried about his income taxes.  He doesn’t have any tuition costs left to claim, and because he’s been depositing some substantial paycheques, he’s worried that he will be faced with a balance owing on his tax return.

So, since Raymond is as human as the rest of us, he puts off filing his income tax return until the middle of April.  He finally heads off to a local accountant to get the task done, and to see how much more he owes in taxes.  His accountant learns that he’s a recent graduate from the Nova Scotia Community College, and tells Raymond about the Nova Scotia Graduate Retention Rebate.

The Nova Scotia Graduate Retention Rebate was implemented in 2009.  The purpose of it was to do exactly what the name suggests – to retain college and university graduates.  Nova Scotia is eager to keep its graduates living and working inside of Nova Scotia, and is putting its money where its mouth is.  If you complete a diploma or certificate program from college, you can qualify to receive $1,250 per year for six years in tax savings.  That’s a total of $7,500 over the six year period.  If you complete a diploma or certificate program from university, the amount doubles to $2,500 per year for six years.  That’s a total of $15,000 over the six years.

The key to receiving the credit is that you need to be a Nova Scotia tax resident at the end of the year.  You are allowed to work outside the province, provided that your primary ties remain in Nova Scotia, and you file a Nova Scotia tax return at the end of the year.  It’s become quite common for taxpayers in Nova Scotia to find temporary work in the Western provinces. This Retention Rebate is clearly designed to encourage them to retain their ties to Nova Scotia, and to continue to file Nova Scotia tax returns.

Anyway, Raymond is very relieved to find out that he doesn’t have to pay any more in taxes – and he’s pleased to be actually getting back a refund.  Now he just wishes he’d done his taxes in February instead of waiting until April!

This article was written to introduce the Nova Scotia Graduate Retention Rebate.  For more information on this lucrative rebate, visit the provincial website at www.novascotia.ca/finance

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I’ve written about this tax credit before, but it’s definitely worth talking about again.  The Nova Scotia Graduate Retention Rebate is worth from $7,500 to $15,000 in actual tax savings, over a 6 year span.

If you are a recent college or university graduate, and you are living in Nova Scotia, be sure to check this one out.

http://www.gov.ns.ca/finance/en/home/taxation/personalincometax/grr.aspx

Filed under: Personal Tax by David Boese 2 Comments »




If you are a Nova Scotia graduate in 2009, you have reason to celebrate.  Beginning with 2009 the Nova Scotia government is allowing graduates to claim a tax rebate on their taxes.

Graduates are required to graduate from a recognized post-secondary institution, and they must have been taking a program offered on a full-time basis.  You are allowed to take the program part time.

University graduates can claim a maximum of $2,500 against their Nova Scotia taxes in the year of graduation, and the following 5 years.  That’s a total of $15,000!  College grads can clailm $1,250 against their Nova Scotia taxes in the year of graduation, and the following 5 years, for a total of $7,500.

Obviously, since the intent is to keep grads working in Nova Scotia, you must file a Nova Scotia tax return each year.  This rebate is non-refundable, which simply means that if you haven’t earned enough income to pay provincial taxes, you can’t claim back the difference.

This rebate replaces the old Graduate Tax Credit, worth a mere $2,000.  However, if you had graduated from a different program in an earlier year, but then return to school and graduate again in 2009 or later years, you can also claim this new rebate.

You can read more about this exciting tax rebate by clicking here.

Filed under: Consumer Tax by David Boese 1 Comment »