When it comes to taxes, there’s no one-size-fits-all scenario. That’s why there are over 400 deductions and credits outlined by the Canada Revenue Agency (CRA).
We’ve rounded up the top 20 most popular deductions and credits to help you make the most out of your taxes and get the best refund after filing your return.
Whatever your tax situation, there’s a credit or deduction out there for you.
Key Takeaways
- Tax deductions are used to reduce your income before any credits are applied.
- Non-refundable tax credits lower your tax payable; they cannot by themselves get you a refund.
- Refundable credits can result in a tax refund, even if you have no tax payable.
Deductions and credits—what’s the difference?
While tax deductions and tax credits both help improve your tax outcome, they are actually different and not interchangeable.
Tax deductions are amounts you subtract from your total income, making your taxable income lower. This means you’d be charged taxes on a smaller amount of income. An example would be self-employed business expenses.
Tax credits are amounts that reduce your calculated tax payable. Some are refundable and some aren’t.
- Non-refundable tax credits: You can use these to reduce your tax payable to zero, but you can’t claim a refund based on these amounts. An example of a non-refundable credit is the charitable donation tax credit.
- Refundable tax credits: When the total of these amounts is more than the amount of tax due or if there is no tax due because the deductions have reduced it to zero, these credits help you get a refund. An example of a refundable tax credit is the Goods and Services Tax/Harmonized Sales Tax (GST/HST) Credit, which is a refundable sales tax issued outside your income tax return.
1. GST/HST Credit
The GST/HST Credit is a refundable tax credit intended to help low- to modest-income Canadians offset the tax they pay on consumer goods and services.
The CRA pays out the GST/HST Credit quarterly. In most cases, all you have to do to receive the credit each year is file your taxes on time, even if you have no income to report.
2. Charitable Donation Tax Credit
When you donate to a charity, you can receive tax benefits for your donations. The Charitable Donation Tax Credit is a non-refundable tax credit available to anyone who makes a donation to a qualifying donee (i.e., a registered charity).
3. Self-employment expenses
Whether you are self-employed or have a full-time job and earn self-employed income on the side, the CRA allows you to deduct a range of business expenses on your tax return.
Depending on your type of self-employment, your expenses could be a few bucks or thousands of dollars. Regardless of the amount of the expense, it’s important to claim all of your business-related expenses on your tax return. In addition to lowering your tax payable, you’re also putting together the most accurate picture of your business’s overall health.
The most common expenses for self-employed taxpayers include:
- advertising
- vehicle expenses
- bank fees
- office supplies
- inventory
- business-use-of-home expenses
- cell phone
If you want to estimate the business expenses you can deduct, use our handy free self-employment expenses calculator and we’ll do the math to show your approximate tax savings.
4. Other employment expenses
Although many employees cannot deduct employment expenses, if your employer requires you to incur certain expenses without reimbursement, you can deduct them on line 22900 (including any GST/HST) as long as they are required according to your employment contract.
Make sure you keep good records and complete the necessary Form T777, Statement of Employment Expenses. Don’t forget to obtain the signed Form T2200, Declaration of Conditions of Employment, from your employer. See supporting documents outlined on the CRA website.
5. Canada Workers Benefit (CWB)
The Canada Workers Benefit (CWB) is a refundable tax credit available for low-income individuals in the workforce. You may also qualify for additional payments like the disability supplement. To be eligible, you have to earn more than $3,000. However, the maximum income level is different in each province.
The amount you receive with the CWB depends on a few factors: where you live, and if you are single with no eligible dependants, or have a family.
6. Registered Retirement Savings Plan (RRSP) deduction
Deducting your Registered Retirement Savings Plan (RRSP) contributions reduces your taxable income, which means you’re taxed on a smaller amount of money and defer tax on that income until future years when you withdraw the RRSP.
To get the most tax savings, you don’t need to deduct all your contributions in the same year. Instead, you can deduct just the amount you need to reduce your tax liability or get the maximum refund. You can then carry forward any unused contributions to deduct in later years when you might be making more money.
7. Home Buyers’ Amount (HBA)
The Home Buyer’s Amount (HBA) is a non-refundable tax credit. If you or your spouse or common-law partner purchased a qualifying home in Canada in 2024, you can claim up to $10,000 which would provide a tax credit of up to $1,500 (15%), reducing the amount of federal tax you have to pay.
The catch is that you have to be a first-time home buyer, which the CRA defines as a person who has not lived in another home owned by you or your partner in the year of acquisition or any of the 4 preceding years.
8. Moving expenses
Did you know that if you relocated more than 40 km for work, you may be eligible to claim your moving expenses? You can claim eligible moving expenses if you either:
- moved and established a new home to work or run a business at a new location
- moved to be a student in full-time attendance in a post-secondary program at a university, college, or other educational institution
Eligible expenses include travel costs, fees for replacing your driver’s licence, and utility hookups.
9. The First Home Savings Account
The First Home Savings Account (FHSA) is a registered savings plan introduced by the CRA to help first-time homebuyers save for a home on a tax-free basis, subject to specific rules and contribution limits.
To open an FHSA, you must be a Canadian resident and a first-time homebuyer, meaning you or your spouse/common-law partner haven’t owned a qualifying home in the year the FHSA is opened or in any of the preceding 4 years.
The annual contribution limit for an FHSA is $8,000, with a lifetime contribution cap of $40,000. Unused annual contribution room can be carried forward to future years, allowing you to maximize your contributions over time. However, the maximum amount you can carry forward is limited to $8,000.
10. Canada Carbon Rebate (CCR)
If you live in Saskatchewan, Manitoba, Ontario, or Alberta, you can claim the Canada Carbon Rebate (formerly known as the Climate Action Incentive Payment.) This rebate helps offset the fuel charge that these 4 provinces add directly to the cost of your gas (whether it’s heating bills or at the gas station).
You’re only allowed one credit per household and the amount you receive is based on the size of your family.
If you live in British Columbia, you can claim the BC Climate Action Tax Credit, which is issued with your GST/HST sales tax credit and helps low-income individuals and families offset the carbon taxes they pay.
11. Home Accessibility Tax Credit (HATC)
Renovations that make homes safer or more accessible for seniors or disabled people may qualify for the Home Accessibility Tax Credit (HATC). If you are a senior, have a disability tax certificate, or are supporting a qualifying individual, you can claim up to $50,000 in expenses which would provide a tax credit of up to $7,500.
Similarly, the Multigenerational Home Renovation Tax Credit (MHRTC), is a refundable credit to assist with the cost of renovating an eligible home to create space for a secondary unit that enables a senior (or an adult who is eligible for the Disability Tax Credit), to live independently, along with the homeowner.
12. Medical expenses
Medical expenses can add up quickly in the run of a year. Everything from routine dental visits to prescriptions to doctors’ fees could earn you a credit at tax time.
To get the most out of your claim, it’s usually best to have one spouse claim all the medical expenses for the immediate family (you, your spouse, and kids under 18) and any dependants you support.
Some often-overlooked medical expenses can include:
- private medical insurance premiums
- tutoring for children with disabilities
- home renovations that improve mobility or access
- travel expenses to seek medical treatment (over 40 km one-way)
- prescription contact lenses or glasses
- dentures and dental implants
- fertility expenses
13. Canada Child Benefit (CCB)
Raising a family can be very expensive. With a significant portion of your take-home income spent on child care, programs, or medical expenses, every dollar counts. 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 might include the Child Disability Benefit (CDB) and any related provincial and territorial programs.
Tip: With CRA My Account, you can review dates and payment amounts for benefit programs. You can easily view the status of your benefit payments, and tax refunds, and submit documents to the CRA.
14. Child Disability Benefit (CDB)
The Child Disability Benefit (CDB) is a tax-free monthly payment made to families who care for a child under age 18 with a severe and prolonged impairment in physical or mental functions.
To get the Child Disability Benefit:
- you must be eligible for the Canada Child Benefit (CCB)
- your child must be eligible for the Disability Tax Credit
Note: If you are already getting the Canada Child Benefit (CCB) for your child who is eligible for the Disability Tax Credit (DTC), you do not need to apply for the CDB, because you will get it automatically.
15. Child-care expenses
You can claim tax-deductible child-care expenses paid to day nursery schools and daycare centres, caregivers such as nannies and babysitters, overnight boarding schools and camps that provide lodging, day camps, and day sports schools.
There are limitations on who can claim the expenses. For example, in a two-parent household, only the spouse or common-law partner with the lower net income can claim child-care expenses. So make sure to review the requirements before filing your taxes.
16. Canada Caregiver Credit (CCC)
Do you support a spouse or common-law partner, or a dependant with a physical or mental impairment? If so, the Canada Caregiver Credit (CCC), a non-refundable tax credit, may be available to you.
The amount you can claim depends on your relationship to the person for whom you are claiming the CCC, your circumstances, the person’s net income, and whether other credits are being claimed for that person. The amounts also change every year.
17. Disability Tax Credit (DTC)
Designed to offset the extra living costs related to having a disability, the Disability Tax Credit (DTC) is a non-refundable credit used to reduce your taxes owed. To qualify for the DTC, you must have a serious and prolonged physical or mental impairment. Depending on the situation, you may be able to claim this credit for yourself, or on behalf of your dependant, spouse, or common-law partner.
The CRA has expanded the eligibility criteria under life-sustaining therapy specific to the DTC for Canadians with type 1 diabetes.
18. Tuition Tax Credit
As the cost of post-secondary education in Canada continues to climb, every dollar saved becomes increasingly important. That’s why students should take advantage of the Tuition Tax Credit.
“Most tuition fees for Canadian colleges and universities in excess of $100 are eligible for the tuition tax credit,” says London, Ontario, accountant Chris Follett. “However, these must be paid by you or someone from your immediate family. If your employer pays or reimburses you without including that amount in your pay, you can’t claim the credit. The same applies if it’s your parent’s employer.”
19. Student loan interest
Interest paid on a student loan is an often-overlooked credit. To help students and graduates offset some of the financial burden of repaying student loans, the CRA offers a deduction for qualifying student loan interest payments.
You can carry forward any unclaimed student loan interest for 5 years, so be sure to keep those documents in order.
20. Ontario Trillium Benefit (OTB)
Ontarians may be eligible for the Ontario Trillium Benefit (OTB). The OTB is a refundable tax credit to assist low-income residents in paying for energy costs, sales tax, and property taxes. It combines 3 tax credits into one single payment:
- The Ontario Energy and Property Tax Credit (OEPTC)
- The Ontario Sales Tax Credit
- The Northern Ontario Energy Credit
Your eligibility is based on your net income from the previous tax year. Payments of this benefit are issued separately from any income tax refund.
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