Have you noticed things have been hard lately? If seeing all your bills add up, along with the rising cost of living feels like an uphill climb, you’re not alone.
If you’ve felt the pinch at one time, or another, Canada’s Affordability Plan might help make life more affordable for you and your loved ones.
Check out all the ways you can get support below and be sure to check back here for updates!
- The Affordability Plan includes $12.1 billion in new support in 2022 to make life more affordable for millions of Canadians.
- The CRA has already approved direct cash payments for many of these programs to qualified Canadians who’ve filed their 2021 income tax returns.
- Some of these credits are in the final stages of approval, so check back soon for final dates and updates.
What is Canada’s Affordability Plan?
Canada’s Affordability Plan will help Canadians earning less income with one-time direct payments and an increase of $12.1 billion in new funding for existing benefits.
There are 8 different programs listed in the proposed plan and while some of these items still need final approval by the Canada Revenue Agency (CRA), some have already come into effect.
1. Affordability support for low-income renters
With the need for affordable housing on the rise, this tax-free payment of $500 is meant to offset the cost of rent for lower income tenants by the end of 2022. To qualify for this benefit, renters must have an adjusted net income below $35,000 for families, or $20,000 for individuals, and pay at least 30% of their adjusted net income on rent. For example, for families earning $35,000, their rent would need to be $875 monthly.
To claim this payment, you’ll need to have filed your 2021 income tax return and provide information regarding your housing situation once the application period opens.
2. Doubling the GST credit for six months
The Goods and Services Tax (GST) credit is a tax-free payment that helps lower-income individuals recoup the GST sales tax they pay on things they buy. The proposal would provide an extra $2.5 billion in tax relief where single folks could receive an extra $234 while couples with two children would receive up to an extra $467.
If you’ve filed your 2021 tax return and already received the GST credit, the increased payment will be issued automatically as a one-time, lump-sum payment before the end of the year.
3. Increasing the Canada Workers Benefit (CWB)
CWB is a refundable tax credit available for low-income individuals who are 19 or older, earning a working income, and residents of Canada. While your benefits will vary based on your income and province you live in, every eligible person can expect to receive up to $1,200 as a refundable tax credit. (Up to $2,400 for every working couple.)
Think of it as a bonus for a job well done, you deserve this.
4. Canada Dental Benefit
Dental care is important for our overall health, and yet 33% of Canadians don’t have access to dental insurance. That’s why the Canada Dental Benefit will provide families with direct, tax-free payments of $1,300 per child over the next two years to help cover dental expenses for their kids under 12 years old.
To qualify, families would need an income of less than $90,000.
If you’re a parent or guardian of a child, you can apply after December 1, 2022 through the CRA website. Don’t forget to provide receipts or dental estimates!
5. Affordable early learning and child care
If you have kids, you know how taxing it can be to find a daycare provider you can trust within your budget.
Canada’s new universal child care benefit aims to reduce daycare fees by 50% in 2022 with the goal of having daycare fees averaging $10-a-day for all regulated child care spaces across Canada by 2026.
This means families can save anywhere from $2,610 in Manitoba up to $6,000 in British Columbia and Ontario. Québec, which already has an affordable child care system in place, will focus on creating 37,000 new child care spaces.
Say it with us—affordable child care for all!
6. A 10% increase to Old Age Security (OAS)
Inflation has hit an all-time high, with the price of necessities like fuel for our bodies, homes, and vehicles sneaking up at around 7% in August 2022.
That’s why the CRA increased the OAS pension for seniors 75 and older by 10% as of July 2022. This means seniors receiving the maximum benefit of $733 monthly, will receive $73 more per month or $880 over the year.
Canadians 65 or older can get the OAS pension if they make less than $129,757 annually and have lived in Canada for at least 10 years. And they can access their OAS even if they’ve never worked or are still working.
7. Climate Action Incentive Payments (CAIP)
If you live in Alberta, Saskatchewan, Manitoba, or Ontario, this one’s for you.
The CAIP is a tax-free amount paid every four months to people and families to offset the cost of federal pollution pricing. For example, a family of four could receive payments ranging from $745 in Ontario to $1,101 in Saskatchewan for 2022–23.
You don’t need to apply to receive payments for the CAIP because the CRA determines your eligibility when you file your income tax return and sends you payments if you’re qualified.
To sweeten the deal, there’s also a 10% supplement for those living in rural communities. If this speaks to you, find out whether you qualify and apply using TurboTax to complete schedule 14.
8. What other benefits are there to help make life more affordable for Canadians?
Canada Child Benefit: If your adjusted net family income is under $32,797, you can receive a maximum amount of $583.08 per month for your child until they turn 6, and $491.91 per month for those 6 to 17 years old. Apply here.
Canada Pension Plan: Increased by 2.4% for 2022, the CPP is a monthly, taxable benefit that replaces part of your income when you retire. To qualify you must be at least 60 years old and have made at least one valid contribution to the CPP. Given that CPP payments aren’t automatic, you can apply here.
Guaranteed Income Supplement: This is a supplementary part of the Old Age Security program. The supplement is based on income and is available to low-income OAS pensioners. It isn’t taxable. Calculate your benefits here.
Want to learn more about making your life affordable? Check out this video from our tax expert Emily, walking you through four ways to prepare for a recession.
Benefits wayfinder: Get the government benefits you’re entitled to
One advantage of filing your taxes every year is getting access to benefits like the GST/HST credit, the Canada Dental Benefit, and the Canada Workers Benefit. But how do you know what benefits you’re eligible for, and how do you make sure you actually get the extra cash?
That’s where TurboTax comes in. We’ve partnered with the national charity Prosper Canada to help Canadians understand and maximize the benefits they’re entitled to. Now, Prosper Canada’s Benefits wayfinder tool is integrated right into TurboTax, so you can find out about applicable benefits while you’re doing your taxes.
Since you need to file your taxes to qualify for many of these benefits, using TurboTax combined with the Benefits wayfinder tool is a convenient way to access these extra funds.
Families with a combined income of $100,000 or less will see this new feature in TurboTax automatically. So, why not try it today and see which government benefits might help make your life more affordable?
The bottom line
As your tax experts and fellow Canadians, we see you. We’re going through it side by side and know how hard you work to take care of your families based on the conversations we’re privileged to have had with you over the years.
You roll up your sleeves and make every dollar count. We’re committed to digging deep to find new cost-saving measures, such as those outlined in the new Affordability Plan, and others to help ensure you get every dollar you deserve.