Most Canadians, understandably, think of our income tax system as a government “program” that takes money out of their paycheques and out of their pockets. And, while it’s certainly true that virtually every Canadian who earns an income must allocate a portion of that income to paying federal and provincial personal income taxes, that’s not the whole picture. Our tax system does, in fact, provide Canadians with a number of direct benefits, through a variety of tax credit and benefit programs which actually put money into the hands of Canadians. And when that money can be obtained with minimal effort (and be received tax-free) it’s a win-win for the recipient.
Those attributes describe the basic child and family benefits paid by the federal government to eligible Canadians every month of the year. However, a substantial number of eligible recipients don’t receive benefits to which they are entitled, simply because they haven’t claimed them, leaving potentially hundreds or thousands of dollars in tax-free income “on the table” each year. As well, many Canadians who do receive such benefits but who then fail to claim them annually can see their benefit payments stop, even though they remain eligible to receive those benefits.
While there are quite a number of such benefits, the process of “claiming” each of them is the same – simply filing a tax return each year. Eligibility for some (but not all) of the obtainable benefits and/or the amount of benefit obtainable is based, in part, on the income of the recipient. When each Canadian files a tax return, the Canada Revenue Agency determines, based on the information provided in that return, the benefits to which the taxpayer is entitled and in what amounts. Where the amount of a taxpayer’s income is relevant to the determination of eligibility, the income figure used is that from the previous year. In other words, a taxpayer’s eligibility for benefits during the 2024-25 benefit year is based on their income for 2023. And that information was provided to the Canada Revenue Agency on the tax returns for 2023 which were filed by taxpayers earlier this year.
Once the CRA receives the needed income information (usually by April 30, 2024) and determines a taxpayer’s benefit eligibility, those benefits are paid to eligible recipients throughout the 2024-25 benefit year, which starts on July 1, 2024 and ends on June 30, 2025.
It should be noted, as well, that while the federal government refers to these benefits under the umbrella term “child and family benefits”, it’s wrong to conclude that benefits are only available to parents and/or married individuals. Of the four benefit programs outlined below which will be in place during the upcoming benefit year, only the Canada Child Benefit program requires that a taxpayer be a parent, and none of the benefit programs require that a taxpayer be married or in a common-law relationship.
GST/HST Credit
The GST/HST credit is a non-taxable amount paid four times a year (on the 5th of July, October, January, and April) to lower and middle-income individuals and families, to help offset the goods and services tax/harmonized sales tax (GST/HST) that they pay. Generally, the credit is available to Canadian residents who meet any one of the following criteria:
- aged 19 years of age or older;
- have or had a spouse or common law partner; or
- are or were a parent and live (or lived) with their child.
The amount of benefit which may be received is determined by both family size and income level. For the upcoming (July 2024 to June 2025) benefit year, the maximum annual GST/HST benefit is as follows:
- $519 if you are single;
- $680 if you are married or have a common-law partner; and
- $179 for each child under the age of 19.
The CRA website includes a chart showing the amount of GST/HST benefit which is provided at different income levels, to individuals and to families of different sizes and compositions. That chart can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/child-family-benefits/goods-services-tax-harmonized-sales-tax-gst-hst-credit/goods-services-tax-harmonised-sales-tax-credit-payments-chart.html.
Eligibility for the GST/HST credit for the 2024-25 benefit year is determined automatically by the CRA for each taxpayer who filed a return for 2023. There is, therefore, no need to indicate on the return that the taxpayer is applying for the GST/HST credit.
Canada Carbon Rebate
Unlike the other three credits which are based, at least in part, on household income, the Canada Carbon Rebate, or CCR (formerly known as the Climate Action Incentive Payment), is a flat rate, non-taxable credit paid to eligible residents living in Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, or Saskatchewan. The purpose of the CCR is to help offset the financial impact of the federal carbon tax, with the amount of the annual benefit determined by the taxpayer’s province of residence and family composition. An online tool allowing taxpayers to estimate the amount of CCR they may receive can be found on the CRA website at How much you can get - Canada Carbon Rebate (CCR) for individuals - Canada.ca.
In addition to living in one of these provinces, recipients must also satisfy the same eligibility criteria as for the GST/HST credit, in that they must be Canadian residents who are at least 19 years of age, or have or had a spouse or common-law partner, or are or were a parent and lives or lived with their child.
The CCR (for all provinces) includes a rural supplement of the base amount for residents of small and rural communities. That supplement, which was set at 10% of the base amount in previous years, has been increased to 20% for the 2024-25 benefit year. While there is no need to apply for the CCR when filing a tax return, individuals who believe they are eligible for the rural supplement need to ensure that they tick the applicable box on page 2 of the return to indicate their eligibility. That requirement does not apply to residents of Prince Edward Island, where all CCR recipients are eligible for the rural supplement.
The CCR is paid in quarterly instalments, meaning that during the 2024-25 benefit year, payments will be made to eligible Canadians on the 15th day of April, July, October, and January.
More information on the CCR can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/child-family-benefits/cai-payment.html.
Canada Workers Benefit
The Canada Workers Benefit (CWB) is a refundable tax credit paid to lower-income Canadian residents who are aged 19 or older or are married or have a common-law spouse or a child with whom they live, and who have “working income” earned from employment or self-employment.
The amount of CWB which an individual or family can receive depends on marital status and net income. The basic amounts payable, and the net income levels at which eligibility for that basic benefit is eroded, are as follows.
- $1,518 for single individuals
The single individual benefit is reduced if adjusted net income is more than $24,975. No basic amount is payable if the applicant’s adjusted net income is more than $35,095.
- $2,616 for families
The family benefit amount is reduced if adjusted family net income is more than $28,494. No basic amount is payable where adjusted family net income is more than $45,934.
In order to apply for the CWB, a recipient must file their tax return electronically and follow the software instructions for applying or, if filing a paper return, must complete and file a Schedule 6 with that tax return.
More detailed information on the CWB can be found at https://www.canada.ca/en/revenue-agency/services/child-family-benefits/canada-workers-benefit.html.
Canada Child Benefit
The Canada child benefit (CCB) is a tax-free monthly payment made to eligible families to help with the cost of raising children under 18 years of age. The CCB is paid to the parent who is primarily responsible for the care and upbringing of the child or children, and the amount varies with the age and number of children.
The CCB is also a means-tested benefit, with the benefit amount being reduced as family net income increases. CCB amounts paid during the 2024-25 benefit year are based on family net income for 2023.
The maximum amounts payable for the benefit year running from July 2024 to June 2025 are as follows.
For each child:
- under 6 years of age: $7,787 per year ($648.91 per month)
- 6 to 17 years of age: $6,570 per year ($547.50 per month)
Where family net income for 2023 is less than $36,502, recipients will receive the maximum amount outlined above for 2024-25, with no reductions.
Individuals and families who may be eligible for the CCB will have their eligibility automatically assessed when they file their tax return for 2023: there is no requirement to file a particular schedule or other application. More information on the CCB is available on the federal government website at https://www.canada.ca/en/revenue-agency/services/child-family-benefits/canada-child-benefit-overview.html.
While the number and variety of federal child and family benefits and the varying eligibility criteria for each can be confusing, the necessary determinations and calculations are done by the federal government. The only step which need be taken by an individual is the filing of an annual tax return. Taxpayers who wish to find information on the benefits for which they may be eligible can refer to the Canada Revenue Agency website at https://www.canada.ca/en/revenue-agency/services/child-family-benefits.html, where detailed information on each such benefit, the eligibility criteria, and amounts which may be received are summarized.