Four tax credits and rebates for the 2023 tax year - and what to do with them

This post was first published on November 16, 2023, and was updated on April 3, 2024.

Nearly half of Canadians (49%) aren’t confident that they know how to maximize their tax credits and benefits to get a bigger tax return, according to a tax survey by H&R Block. Yet a similar number of us (46%) say we’re relying on getting a tax refund to pay for things like debt, bills and everyday expenses. Whether you need help with the cost of sales taxes, raising a child, or managing the cost of living, let’s explore the tax credits and rebates that can put more money back in your pocket and take the pressure off your finances.

Tax credits and rebates for the 2023 tax year 

There are literally dozens of tax credits and rebates available depending on your circumstances, but these are some of the most popular.

1. GST/HST credit

You pay goods and services tax (GST) or harmonized sales tax (HST) on just about everything you buy. If you have low to modest income, you can get a quarterly credit from the government to offset the cost of sales tax.

Am I eligible?

The GST/HST credit is available to residents of Canada who are 19 and over, as well as younger people who are married or have dependent children. Individuals and families with income under $42,335 can claim the GST/HST tax credit, and you may qualify with income up to $65,000 depending on your marital status and how many children you have. 

How much will I get?

The basic formula for the GST/HST tax credit is $496 per adult, plus $171 per child under 19. You may qualify for an additional credit of up to $171 if you’re a single parent or your household income is over $11,511.

Using this formula, a family of four would be eligible for a credit of up to $1,163.

 

If your income exceeds $42,335, your credit will be reduced by $1 for every $20 you earn above that threshold. A single person will no longer qualify once their income exceeds $52,255, while a couple with two children will no longer qualify once their income exceeds $62,175.

When is the credit distributed?

The GST/HST credit is paid in quarterly installments in January, April, July, and October of each year.

How to apply

All you have to do to apply for the GST/HST tax credit is file your taxes each year. Because this is a refundable tax credit, you can receive it even if you don’t have any income to report.

If you are new to Canada, you can apply for the GST/HST tax credit before you file your first tax return. The forms to apply are available on the CRA website.

2. Canadian child benefit (CCB)

The Canada Child Benefit is a tax credit that provides parents and guardians of children under 18 years old with a monthly payment. 

Am I eligible?

The Canada Child Benefit is available to everyone who is primarily responsible for raising a child under 18 years of age. This is typically presumed to be the female parent, but can also be another parent (including in a same-sex couple), grandparent, or other person who takes the lead role in caring for the child. Only one person can claim the CCB for each child.

You may be eligible to receive a partial benefit if you have shared custody of a child, or full custody on a temporary basis.

How much will I get?

The amount you will receive from the Canada Child Benefit depends on how many children you have, their ages, whether or not you’re married, and your family’s income.

The calculation for the CCB is $7,437 per year for each child under 6 years old and $6,275 for each child between 6 and 17. This amount is gradually reduced for families earning over $34,863 and rapidly reduced for families earning over $75,537.

If your child has a disability, you may qualify for the Child Disability Benefit (CDB), which pays up to an additional $3,173 per child.

When is the benefit distributed?

The CCB is paid to parents each month during the year. If your total benefit amount is less than $240 for the year, you’ll receive a single payment in July.

How to apply

You can apply for the Canada Child Benefit as soon as your child is born, or as soon as you become the primary caregiver of a child under 18 years of age.

If you become responsible for a child by way of birth, you can apply for the CCB at the same time you register the birth with your province or territory. If you become responsible for a child another way, or you didn’t apply when you registered the birth, you can apply online through the CRA My Account or by mail. 

3. Canada workers benefit (CWB)

The Canada Workers Benefit is a tax credit that helps people who are working and earn a low income.

Am I eligible?

The Canada Workers Benefit is available to residents of Canada 19 years of age and older, except full-time students, who earn employment income less than the specified threshold for their province. If you qualify for the CWB and the disability tax credit, you may also qualify for a disability supplement.

How much will I get?

The Canada Workers Benefit pays up to $1,428 to individuals and $2,461 to families, plus a supplement of up to $737 for people with a disability.

The maximum benefit is paid to singles who earn less than $23,495 and families with income under $26,805. Individuals and families may be eligible for a partial benefit with income under $33,015 and $43,212, respectively. 

The maximum disability supplement is paid to individuals with income under $33,018 and families with income under $43,210. Partial benefits may be paid to individuals and families with income less than $37,932 and $53,037, respectively.

Note that the maximum income to receive the CWB is lower in Quebec, but higher in Alberta and Nunavut.

When is the benefit distributed?

The Canada Workers Benefit is paid as a refundable tax credit when you file your income taxes.

When you first become eligible for the CWB, the CRA will automatically send you in advance payments totalling 50% of your benefit. These payments are made three times per year, in January, July, and October. The remainder will be paid at the end of the year when you file your taxes.

How to apply

To apply for the Canada Workers Benefit and/or the disability supplement, complete Schedule 6 and submit it when you file your tax return.

4. Canada Carbon Rebate (Formerly climate action incentive payment (CAIP))

The Canada Carbon Rebate (CCR) is a tax credit designed to help Canadians with the cost of the federal carbon tax. The program includes an additional supplement for residents of small and rural communities.

Am I eligible?

The CCR is available to residents of participating provinces who are 19 years of age and older.

The 20% supplement for residents of small and rural communities is available to residents of participating provinces who live outside a census metropolitan area (the increase from 10% is pending approval). You can get detailed information on whether you qualify from the CRA website.

How much will I get?

The amount you receive depends on where you live and how many children you have. The payment is highest for residents of Alberta, and lowest for residents of New Brunswick. It is not offered to residents of British Columbia, Quebec, or the territories.

The annual benefit ranges from $380 to $900 for individuals, plus an additional 50% of the base amount for married couples, plus an additional 25% of the base amount for each child under 19. A supplement of 20% of the total payment is added for those who live outside of a census metropolitan area.

The CCR is a universal tax credit, so there is no minimum or maximum income to qualify for the full amount.

When is the payment distributed?

CCR payments are made four times per year in January, April, July, and October.

How to apply

Your application for the Canada Carbon Rebate is made automatically when you file your taxes. In order to receive payments for your children, they will need to be registered for the Canada Child Benefit.

Other provincial tax credit and benefits

1. Ontario trillium benefit (OTB)

Residents of Ontario may be eligible for the Ontario Trillium Benefit, an amalgamation of four tax credits designed to help low-income individuals and families with the cost of energy, property taxes, and sales tax.

Am I eligible?

Eligibility for the Ontario Trillium Benefit is determined individually for each of the four programs it comprises:

• Energy: The energy component is available to residents of Ontario who pay rent, property taxes, live on a reserve, or live in a public or non-profit long-term care home.
• Property tax: The property tax component is available to residents of Ontario who pay rent, property taxes, or live in a school residence.
• Northern Ontario Energy Credit: The Northern Ontario Energy Credit is available to residents of Algoma, Cochrane, Kenora, Manitoulin, Nipissing, Parry Sound, Rainy River, Sudbury (including the City of Greater Sudbury), Thunder Bay, and Timiskaming who pay rent, property taxes, live on a reserve, or live in a public or non-profit long-term care home.
• Ontario Sales Tax Credit: The Ontario Sales Tax Credit is available to residents of Ontario 19 years of age and older.

How much will I get?

The amount you can get from the Ontario Trillium Benefit depends on how you qualify for each of the four embedded programs:

• Energy: The energy component pays 20% of the amount you paid in rent and/or property tax to a maximum of $265 per family. The benefit is reduced by $1 for every $50 you earn over $33,169.
• Property tax: The property tax component pays 2% of your rent and property tax expenses to a maximum of $$1,421 and the amount you receive depends on your age and whether you live in a home or reserve, long term care, or a campus. The benefit is reduced by $1 for every $50 you earn over $33,169.
• Northern Ontario Energy Credit: The Northern Ontario Energy Credit pays up to $180 for individuals and $277 for families. The amount is reduced by $1 for every $100 you earn over $59,704 for families and $46,436 for individuals.
• Ontario Sales Tax Credit: The Ontario Sales Tax Credit pays up to $360 for each family member. The benefit is reduced by $1 for every $25 you earn over $33,169 for families, or $26,535 for individuals.

When is the payment distributed?

If you’re eligible for the Ontario Trillium Benefit, you will receive a payment each month. If your entitlement is $360 or less, you will receive one payment in July.

How to apply

You can apply for the Ontario Trillium Benefit when you file your taxes. The Ontario Sales Tax Credit portion is handled automatically, but you’ll need to complete the form ON-BEN to apply for the energy, property tax, and Northern Ontario energy components.

2. Alberta child and family benefit

The Alberta Child and Family Benefit is a tax credit for residents of Alberta to help with the cost of raising children.

Am I eligible?

The Alberta Child and Family Benefit is open to residents of Alberta who qualify for the Canada Child Benefit.

How much will I get?

The Alberta Child and Family Benefit is divided into two components: base and working.

The base component is paid to everyone who is eligible, and pays up to $1,410 for the first child plus $705 for each additional child under 18 years of age to a maximum of four children.

The working component is paid to everyone with employment income of at least $2,760 and pays an additional amount depending on the number of children you have. Families with one child receive $722, families with two children receive $1,379, families with three children receive $1,772 and families with four or more children receive $1,902.

The base component is gradually reduced for families earning over $25,935 and the working component is gradually reduced for families earning over $43,460. 

When is the benefit distributed?

This tax credit is paid by mail or direct deposit in quarterly installments in February, May, November, and August of each year.

How to apply

You can apply for the Alberta Child and Family Benefit at the same time you apply for the Canada Child Benefit – most commonly when you register a birth online with the Alberta Online Birth Registry.

What to do with your tax credits and rebates

If you’re eligible for these tax credits, you’re probably feeling the pinch of higher prices and rising interest rates. Here are a few ideas to put your tax credits to good use:

1. Pay off high interest debt: As interest rates go up, it’s becoming more and more expensive to carry debt. Consider using your tax credits to pay off your highest interest debt, like credit cards and unsecured lines of credit.
2. Pay for essentials: It goes without saying that life is more expensive in Canada than it has ever been before. Use your tax credits to help pay for essentials like rent, hydro, gas, and groceries.
3. Start or add to an emergency fund: If you’ve paid off all your high-interest debt, consider starting an emergency fund to save for a rainy day. Choose a high-interest savings account to grow your savings faster.
4. Save for a large expense (down payment, education/upskilling): Whether you’re planning to buy a house, a car, or a postsecondary education, you may want to use your tax credits to help you get closer to your goal. Don’t forget to use the right savings programs to take advantage of further tax savings.
5. Consider GICs: If you have extra money but aren’t sure what to do with it, a guaranteed investment certificate (GIC) is a great way to invest it for the short-term. You can get terms ranging from one month to five years, and get a guaranteed return without having to worry about what’s happening in the economy.

 

The bottom line

Make the most of the tax credits you’re entitled to. Make sure you apply for all the programs you think you may be eligible for, and put your payments to good use by paying off debt and saving for your future.

 

Also read:

• Smart ways to spend your tax refund
• Is mortgage interest tax-deductible in Canada?
• What is the First-Time Home Buyers’ Tax Credit and how does it work?