What should international students know about the Canadian financial system?

For the growing number of international students who study in Canada each year, this country’s financial system is one more thing they need to learn.

Navigating a new country’s financial system can be daunting and potentially dangerous for those without a safety net since limits on working hours make it difficult to earn money in Canada. But experts say help — opening a bank account, filing taxes or applying for government assistance — is available if you know where to look.

Shreya Vohra, a University of Toronto student who works at the Center for International Experience, says it’s normal for newcomers to have trouble managing their money when they arrive. “If you’re confused and don’t know what’s going on, you’re not alone. Everyone asks the same questions.

From questions about how to open a bank account to paying taxes, Ms Vohra says she’s heard it all. Along with the comfort of realizing they’re not alone, she says international students should also know there are resources out there for them.

The number of international students studying in Canada has steadily increased over the past decade. In the 2019-2020 academic year, international students made up approximately 18.5% of the more than two million students enrolled in Canadian colleges and universities, according to Statistics Canada.

International students pay an average of four times more in tuition fees than the average Canadian undergraduate student. This year, international undergraduate students paid $33,623 compared to $6,693 for their Canadian counterparts. The majority of international students in Canada come from two countries: India and China.

International students are in a precarious situation due to their temporary immigration status, which makes it more difficult to access government support programs such as the Canada Emergency Student Benefit or the Canadian Emergency Response Fund. ’emergency. Government programs early in the pandemic were either unavailable to most international students, such as the Canada Emergency Student Benefit, or had requirements that could be difficult to meet, such as a minimum income of $5,000 for the Canadian Emergency Response Fund. Such benefits can be a financial lifeline for students, who can only work a maximum of 20 hours a week.

Additional help is available, if you know where to look. Vohra suggests contacting your school’s student services office for help with financial matters, including how to open a bank account.

Anyone in Canada can open a bank account as long as they have appropriate ID. This may include a passport, study permit or, at some locations, student ID. Contact the banks directly to see if they allow requests from abroad and the specific requirements for each financial institution.

But before making a final decision, Cara Piperni, director of scholarships and student aid at McGill University, stresses the importance of shopping around for any financial product, including bank accounts.

When choosing a bank, consider whether the institution accepts money transfers from your home country, the fees charged for opening and maintaining an account, and the number of transactions allowed per month. Most banks should have a student account plan with no fees and unlimited transactions.

However, if the banks have fees, Piperni advises students to negotiate with the banks. “It’s better to have money in your pocket than in your pocket,” she says.

Many international students may not be aware that they may be eligible to receive tax refunds, if they apply, Piperni says. This applies even if they don’t make money in Canada, she says.

Whether or not you are required to file a tax return will depend on your Residence status. The common measure of residency status is whether you have been in Canada for 183 days or more. Those who do will likely need to file a regular tax return, while those who don’t already will need to file a return on certain sources of income, such as dividends.

To file your tax return, you will need a social insurance number or individual tax number, as well as any tax forms you may have received for tuition and income, including including scholarships and bursaries.

The deadline to file your tax returns online or by mail is April 30. International students in Quebec may have to file a second provincial income tax return with Revenu Québec.

Although self-filing of taxes is free and possible, some international students may wish to seek professional help with tax filings or other personal finance advice.

“A lot of people think financial planners are only there to help you if you’re rich and rich and that’s completely wrong,” says Clement Chung, a certified financial planner based in Burnaby, British Columbia.

Mr. Chung recommends checking the references of potential advisers through the PF Canada website.

Financial planners typically charge a fixed fee or are paid on commission. Their services can cost between $2,000 and $5,000 a year, according to Chung.

Because this is a large sum of money that is out of reach for many students, some schools also have their own financial advisors that students can access for free, and Ms. Vohra strongly encourages seeking out these resources. Knowing where to get help is especially important in times of financial hardship.

Student service centers can potentially help students find scholarships, delay tuition payments, if needed, or help find other resources.

What’s important to know, says Ms Vohra, is that help is available – and it’s best to seek help before you reach a crisis point.

“Always look for resources, because they exist.”

Are you a young Canadian with money on your mind? To set you up for success and avoid costly mistakes, listen to our award-winning Stress Test podcast.