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Student Loan interest credits and Education Amounts


Robert18
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So it seems that Educational amounts carry forward indefinitely (?) , but Student Loan interest credits carry forward for only 5 years.

 

Is there a tax reason that causes Educational amounts to supersede the Interest tax credit?

 

I ask as Ufile is using none of the expiring Interest tax credits in favour of educational amounts.

 

Edit:

Short answer: it is a CRA tax problem.

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15 hours ago, Curmudgeon said:

In your T2202 form, what happens if you set Transfer of current year unused amounts to Carry forward?

There doesn’t seem to be any option that would affect the results without manually adjusting the “Unused amounts” to an amount lower than what is necessary to eliminate my tax burden. Manually setting does allow for interest amounts to be used then. I think it’s best to with you next option and contact them as I think it’s an error in the program.

14 hours ago, Curmudgeon said:

If nothing works, contact the technical people and explain how expiring credits are not being applied first. There may be a quick fix.

Thanks for you assistance.

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  • 3 weeks later...

So actually looking at Schedule 11 in the return tab answered my questions. Ufile is not clear what's happening. All they will say is that they reduced your credits claimed for interest on student loans, so you can carry them forward (even if its expiring).

 

What is really happening here is that it is a limitation of the Schedule 11 form and it rules for calculating the education amounts to be applied as tax credits. The calculation tells you add all the already applied credits lines 79 to 93, however the student loan interest credit is line 94 so applying any of those credits is wasted until the education amounts are exhausted. 

 

This isn't a problem with UFILE but with the tax form, however UFILE should be more clear about why and how the credits are being applied and the help section does not explain this issue.

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