10 Tax Benefits for Low Income Canadians in 2023

What is considered low income in Canada?

The definition of low income can mean something different depending on who you ask and the types of benefits you apply for. 

This is because researchers and policymakers in Canada use different measuring tools to decide who needs assistance. So income cutoffs can differ for each program, benefit, or credit.  

In other words, the amount of money you make influences the types of benefits and credits you’re eligible for. If you fall below certain income levels, you may qualify for some of these credits and benefits.

1. Canada Workers Benefit

The Canada Workers Benefit (CWB) is a refundable tax credit designed to help low income working individuals and families with their financial needs. Eligible taxpayers can receive up to $1,428 (for single individuals) for the 2023 tax year. Starting in July 2023 and based on the 2022 taxation year, the CWB will provide advance payments equal to 50% of the CWB across 3 payments under the Advanced Canada workers benefit (ACWB).

You can apply for the CWB when you complete and file your tax return.

2. GST/HST credit

This credit helps lower income Canadians offset all or part of the federal Goods and Services Tax/Harmonized Sales Tax (GST/HST) they pay when purchasing products and services. 

The credit ranges from $496 to $650, depending on your net income and family situation. Once you reach a certain income, you’ll no longer receive this credit. 

You can apply for the GST/HST credit by filing your tax return.

3. Canada Child Benefit

The Canada Child Benefit (CCB) is a tax-free monthly payment made to eligible families with children under the age of 18. Eligible families may receive up to $7,437 per child for the 2023–2024 benefit year. The amount you’re eligible to receive depends on your family’s income and size. To continue with the monthly payments, you must file your tax return on time each year.

If you have a child with a qualifying disability and approved Disability Tax Certificate, they will receive $3,173 ($264.41 per month).You need to be a Canadian resident to qualify and must complete Form RC66, Canada Child Benefits Application, to apply. 

5. Canada Dental Benefit

The temporary Canada Dental Benefit is here to help lower dental costs for eligible families. These families earn less than $90,000 annually and have children under 12 who received dental work in the specified periods. The first benefit period is for children 12 years old (as of December 1, 2020) who receive dental care between July 1, 2023, and June 30, 2024.

You can apply for the Canada Dental Benefit through your CRA My Account, by phone, or online through this link.

6. Refundable provincial credits

In addition to the available federal tax credits and benefits, many provinces and territories have separate benefits and credits. 

Ontario Trillium Benefit

The Ontario Trillium benefit is one of Ontario’s tax benefits. It provides a tax credit of $172 to $265, depending on your income and family status.

Quebec credits

If you live in Quebec, here are a few tax credits to consider:

• Quebec Family Allowance: Similar to the CCB, the Quebec Family Allowance is a tax-free monthly payment provided to families living in Quebec with children under 18 years old. The credit amount varies between $389 and $2782 for each family. You must file your tax return and complete the provincial forms to apply for this credit.
• Quebec refundable cost of living tax credit: This tax credit can provide a credit of up to $600 if your net income is less than $104,000, as long as you file your 2021 tax return by June 30, 2023. The credit will automatically be paid out to people who qualify. 
• Solidarity tax credit: The solidarity tax credit is a refundable tax credit for low and moderate income individuals in Quebec. The amount of the credit depends on income and marital status.

7. Basic Personal Amount 

Both federal and provincial governments offer a basic personal amount (BPA) for taxpayers to claim on their tax returns. This non-refundable tax credit lets you to reduce the taxes you owe federally and provincially. For the 2022 tax year, the federal amount is $15,000, while the BPA for Quebec is $16,143.

The amount of this tax credit varies by province. 

8. Tuition tax credits 

If you’re a student, you can apply for tuition tax credits and the Canada Training Credit when you file your tax return. The tuition tax credit allows you to claim up to $5,000 in tuition fees per year. 

If you attended a recognized educational institution, you can claim these amounts on your tax return. You should have received a T2202 form from the school you’re attending. This form contains everything you need to include to claim tuition credits on your tax return. 

Tuition tax credits can be carried forward to a future taxation year or transferred to a spouse or common-law partner. Tuition amounts can also be transferred to a parent.

9. The Canada Training Credit

The Canada Training Credit (CTC) is a refundable tax credit that accumulates as students complete their post-secondary education. 

If you’re a student between 25–65 and have eligible tuition expenses, you may be able to claim the CTC in your tax return, as long as your CTC limit on your Notice of Assessment is higher than zero.

10. Tax credits for senior citizens

There are several tax credits available for low income seniors.

• The Home Accessibility Tax Credit (HATC): This is a non-refundable tax credit for seniors. This credit helps cover the costs of renovations or home modifications to improve mobility and independence. Use TurboTax to automatically claim the HATC on line 31285 of your tax return. You must be 65 or older or be entitled to the disability tax credit.
• The Age Amount Tax Credit: If you’re 65 years old or older and have a net income of less than $42,335, you can claim up to $8,396 on your tax return. This amount is automatically calculated according to your date of birth when you use TurboTax.
• Quebec Independent Living Tax Credit: This is a refundable credit for seniors 70 and older living in Quebec who have incurred expenses to continue living independently. If you spent at least $250 on personal safety monitoring, accessibility in your home, or even spent time in a rehabilitation center, you may be able to deduct these expenses to receive a 20% credit on the portion that exceeds $250.
• Split pension amount: Qualifying seniors can split their pension amounts to save income tax. Seniors can transfer up to half their eligible pension income to their spouse or common-law partner. This will reduce their overall taxable income and the amount of taxes they have to pay. With TurboTax, it’s easy to calculate the amount to split for the most tax benefit!

You can apply for these tax credits (and more) when you file your tax return with TurboTax. 

Benefits wayfinder: The easy way to find government benefits

There’s a lot to keep track of when it comes to doing your taxes and searching for benefits you qualify for. In fact, you might be leaving money on the table if you don’t file your taxes annually and make sure you’re getting all the benefits you’re eligible for.

To make it easier for you, national charity Prosper Canada created Benefits wayfinder to help you understand and maximize the government benefits you’re entitled to. This tool is integrated right into TurboTax, so you can find out about applicable benefits while you’re doing your taxes and make sure you’re not missing out on the funds that you qualify for.

Families with a combined income of $100,000 or less will automatically see this new feature in TurboTax. So, why not try it today and see which government benefits might help make your life more affordable?

The last word 

Whether you’re a student or between jobs, making ends meet can be a real challenge if you fall into the low-income category in Canada. It doesn’t help that the cost of living has skyrocketed (thanks inflation!).

Filing your taxes can help you access essential benefits, credits, and deductions, giving you more financial flexibility.