Moving for med school or residency? Here’s what you can deduct
If you are relocating this year, whether for medical school or residency, keep in mind that you can deduct a number of moving expenses on your tax return.
Resident physicians can claim moving expenses against their employment income, while full-time students attending a post-secondary institution can deduct moving expenses from taxable scholarships or awards.
How far do I need to move?
You need to move at least 40 kilometres closer to your new school or work location (compared with your previous home) to be able to deduct moving expenses against employment income.
What kind of expenses can I deduct?
- Transportation costs (vehicle expenses)
- Costs of moving your items or belongings (packing, hauling, movers, in-transit storage, and insurance)
- Travel expenses on your way to your new residence (meals and accommodation)
- Temporary living expenses (meals and accommodation, for up to 15 days)
- Costs of cancelling a lease for your old residence, excluding any rental payment for the period during which you occupied the residence
- Incidental costs related to your move (e.g., costs of changing your address, replacing new auto and driving licences, having utilities disconnected and hooked up)
Do I need to keep all my receipts?
It’s best to keep all of your receipts and documents to support your claim, since the Canada Revenue Agency might ask for them.
For meals and vehicle expenses, you can choose to use the detailed method or the simplified method. If you’re using the detailed method, collect all your receipts and report your exact expenses. If you use the simplified method, you can claim a flat rate per meal (up to $69 per person a day). For vehicle expenses, you’re able to claim a certain amount per kilometre. In Ontario, for instance, you can claim 55 cents/kilometre travelled.
The above information should not be construed as offering specific financial, investment, foreign or domestic taxation, legal, accounting or similar professional advice, nor is it intended to replace the advice of independent tax, accounting or legal professionals.