Tax returns blocked for 50,000 teachers who claimed school supply tax credit

Kajsa Hansen, an elementary and middle school teacher, said she was counting on her scheduled tax refund of $12,467 to pay future bills, such as a new battery for her motorized wheelchair.

But now the Calgary resident thinks she’ll have to rack up those charges on her credit card. That’s because her refund is pending due to a tax credit she claimed, which, it turns out, hasn’t been approved yet.

“It makes me angry and frustrated,” said Hansen, who has a genetic condition that affects his mobility.

“Why is it [the credit] there like something I can claim if I can’t claim it?” she said. “There was no warning.”

The Canada Revenue Agency (CRA) is withholding about 50,000 teachers’ tax returns, the agency confirmed to CBC News – all because of a tax credit they claimed for school supplies purchased for their students.

In what is called the School supply tax credit for eligible educators, the federal government has increased the maximum that teachers can claim from $150 to $250. The problem is that the increase is included in the new legislation (Bill C-8) which has not yet been passed in Parliament.

Until the bill becomes law, any teacher who claimed the credit will not receive their tax return.

“It’s not just the tax credit, it’s the whole process of any other refunds they get that’s now being delayed because their returns are set aside. And that’s just not fair,” said Sam Hammond, president of the Canadian Teachers’ Federation. “Some of them need that money.”

Elementary teacher Chelsea Turcotte of Edmonton had hoped to use part of her expected $4,061 tax refund to pay for a recent increase in her utility bill – until she learned that her refund is pending. (Chelsea Turcotte)

Elementary teacher Chelsea Turcotte of Edmonton had hoped to use part of her expected $4,061 tax refund to cover a rise in her utility costs. But when she learned her comeback was in limbo, she had to make other plans.

“I had to ask my mother for a loan,” said Turcotte, on the verge of tears. “It breaks my heart to have to take this step, but that’s where it’s at right now.”

The teachers did not understand the message

Tax expert Armando Minicucci said teachers could have avoided the delay by filing their taxes without claiming the credit yet.

“You have up to ten years to change your tax return, so you have plenty of time,” said Minicucci, of Toronto-based law firm Grant Thornton.

But this plan only works if you know the problem in advance. CBC News interviewed five teachers who each filed their own taxes in February or March, and said they had no idea at the time there was a problem with the school supply credit.

“If they had told us there would be a delay, I wouldn’t have bothered to ask,” said Hansen, whose credit request was only $68.

The CRA told CBC News that beginning Feb. 18, when it became clear the legislation would not be passed in time for the start of tax filing season, it sent out notifications to tax preparers. returns and tax software developers, and messages displayed for online tax preparers.

The CRA made no mention of alerting taxpayers.

CBC News found an alert posted on a government site describing the credit. However, according to a internet archive searchthe post was added on or after April 9.

“A case important enough to cause stress”

Hansen said she only heard about the issue after calling the CRA a few weeks ago to find out the status of her refund.

Kathryn Olson, an elementary school teacher from Winnipeg, said she found out why her scheduled $1,087 tax refund was delayed thanks to a social media post by another teacher.

“I really, really wish I had known this was going to be a problem,” said Olson, a freshman teacher who is still paying off his student debt.

“It’s really hard for someone who’s just starting to become a financially independent person. Like, $1,000…that’s big enough to cause stress.”

“Unfortunately there is nothing they can do at this stage”

Minicucci said teachers who have already filed their return cannot resubmit their return until they receive their dues from CRA.

“There is unfortunately nothing they can do at this stage other than to hope that the legislation receives Royal Assent soon.”

Bill C-8 was tabled in Parliament in mid-December and has yet to pass third reading in the House of Commons. If and when it does, it still needs to pass the Senate.

The office of National Revenue Minister Diane Lebouthillier said the official opposition was to blame for the heist.

“Conservative MPs are playing political games with this bill to delay its coming into force,” spokesman Chris MacMillan said in an email to CBC News.

Sam Hammond, president of the Canadian Teachers’ Federation, says it’s unfair to withhold teachers’ reimbursements because some of them need the money now. (Michael Wilson/CBC)

The Conservatives contest the request.

“Conservatives oppose Bill C-8 because it implements part of the Trudeau government’s 2021 budget, which involved excessive borrowing and spending,” said finance critic Ed Fast. in an email.

“It’s not about political games; it’s about the official opposition doing its job of reviewing legislation, and it’s up to the government to decide when they want to vote on legislation.”

Rather than pointing fingers, teachers hope the two parties can work together to find a solution, so they can quickly pocket their refunds.

“I just want them to do their job,” Hansen said. “I was going to work every day. I did my job, so I would like my money back.”