Warning: Tax Crunch for BC’s ABE Students

With tax season upon us, we are starting to see that ABE students are being charged taxes on the Adult Upgrading Grant (AUG) funds received in 2015. For example, in one case, a student is charged $260 tax on roughly $3,800 received through the AUG.

Even though BC’s ABE students are now being charged tuition fees as high or higher than university level courses, unlike their university counterparts, ABE students can’t claim tuition against their income. In the case of Adult Basic Education students in full-time studies, they are now responsible for tuition of almost $5,000/year for basic reading, writing,  math, computer skills courses and high school level subjects.

Students have started bringing in tax documents downloaded from their student services websites that detailed their grant funding as income. This was new news. Now with more evidence that indicates that the grant is taxable, there are ramifications for low-income ABE students.

  1. Students are being assessed taxes on the AUG after the fact. A deferred charge (tax) raises the barrier to access and deters students from re-applying.
  2. Students have not been communicated to plainly that a tax bill will follow the AUG.
  3. Above all, the tax reduces the overall benefit to low-income students.
  4. Adding grant funding to income has the potential to disqualify students for the AUG. For example, a student making below but close to the low-income threshold, will suddenly be pushed above it. A full-time ABE student will add well over $5,000 (grant funding for tuition, UPass and college fees) to their annual income.

BC Federation of Post-Secondary Educators summed the situation up in their April 7, 2016 press release:

When this government eliminated free tuition for students in developmental programs, the Minister of Advanced Education insisted that low-income students would not be hurt,” says George Davison, FPSE President. “But this government’s so-called fix for adult basic education is no fix at all.”

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