If you are a first-year or an upper-year student who lives in a dorm or other on campus-housing, you are eligible to claim the cost of your room on your tax return and get a $25 credit. No evidence or receipt is required.
As an Ontario resident who pays rent, you may be eligible to claim the Ontario Trillium Benefit and the Ontario Energy and Property Tax Credit on your tax return. Here is some information about each credit:
Ontario Trillium Benefit: This is a refundable tax credit that is designed to help low-income individuals and families cover the cost of energy bills and rent. To be eligible, you must be a resident of Ontario, 18 years of age or older, and meet certain income requirements which depend on your family income, marital status, and dependents. You can apply for the Ontario Trillium Benefit by completing the ON-BEN application form when you file your tax return.
For the 2022 tax year, the income thresholds for the OTB are as follows:
- Single individuals: a maximum income of $29,590
- Married or common-law couples: a maximum combined income of $39,785
- Individuals with children: a maximum family income of $48,025, plus an additional $3,430 for each child under 18 years old
Ontario Energy and Property Tax Credit: This is a refundable tax credit that helps low- to moderate-income individuals and families with the cost of energy and property taxes, so it’s ideal for individuals who own a house. To be eligible, you must be a resident of Ontario, 18 years of age or older, and meet certain income requirements. The amount of the credit is based on the amount of rent or property taxes you paid in the previous year. You can claim this credit by completing the ON-BEN application form when you file your tax return.
It is important to note that you cannot claim both the Ontario Trillium Benefit and the Ontario Energy and Property Tax Credit in the same tax year. You will need to choose one or the other.
If you pay rent to a non-resident who has an agent collecting rent from you, then you have no obligations in relation to the rent payments. The property manager/agent is liable to pay the tax if the withholding requirements are not met and can attempt to recover the amounts from the non-resident.
On the other hand, if you are paying rent directly to a non-resident landlord, the withholding tax requirements and liability falls on you, the tenant. Specifically, it is your responsibility to withhold non-resident tax at a rate of 25% on the gross rental income paid to the non-resident landlord. You would require a CRA non-resident tax account, which you can sign up for through CRA’s online services. You would be required to make the monthly payments to the CRA through mail by the 15 of the month following the month of rental, and you would have to file an NR4 information return by the end of March in the following year. As well, you also would have to send copies of the NR4 slips to your landlord by the end of March.
- Mahnoor, Young Tax Professional