Who is Eligible for a Carbon Tax Rebate?

What is the Carbon Tax Rebate?

The Canadian government provides tax-free money known as the Carbon Tax Rebate, to help Canadian consumers cope with the increasing costs of pollution, which inflate gasoline and energy prices. It is also known as the Climate Action Incentive Payment or CAIP. All the money collected from the carbon pollution pricing system is returned to families, businesses, farmers, and native groups. According to the estimation, most Canadian families receive more money in return than they pay under this system. Low-income Canadians get the most benefit.

Previously before 2022, this payment was available as a refundable tax credit. Canadian individuals could request this on their tax returns. But from July 2022, the rebate changed to an automatic payment. Now the rebate is given quarterly to eligible residents of Alberta, Manitoba, Ontario, and Saskatchewan.   

In 2023, the federal fuel charge was put into action in Labrador, Newfoundland, Prince Edward Island, and Nova Scotia. Residents of these areas are receiving payments quarterly. Residents of British Columbia, Quebec, and the Northwest Territories are ineligible to receive the carbon tax rebate as they do not participate in the federal carbon pollution pricing system.

Who is Eligible for a Carbon Tax Rebate?

To receive the Climate Action Incentive Payment, the applicants must meet some specific eligibility criteria.

• The individuals must be Canadian citizens before the payment month to qualify for the payment. The individual must be a resident of an applicable CAIP territory on the first day of the payment month.
• Applicants must be older than 19 years. If an individual fails to meet the criteria, he or she must meet at least one of the following conditions: The individual having or had a spouse or common-law partner, or the Individual must be a parent and living with the child.
• The Individuals must be a taxpayer to be eligible for Carbon Tax Rebate Canada. Canada Revenue Agency (CRA) has the necessary information of each taxpayer and it helps to evaluate the eligibility and to calculate the amount to be paid.
• Only one person in a household is eligible for the compensation if the individual shares a home with a partner
• Additional paperwork is needed if the individual has recently moved to Canada. 

Eligible children

If your child is registered already for the Canada Child Benefit (CCB), the GST/HST credit, or the CAIP, you will get a credit for each eligible child. But you must need to meet all the following conditions at the beginning of the payment month:

• Your child is under 19 years old
• Your child lives with you
• You are responsible for taking care and upbringing of your child
• Your child is registered for CCB, GST/HST credit, or CAIP

In families where the ex-spouse shares the custody of the child, the parent can still receive an equal 50% of the CAIP payment. If your child is not registered yet, you will need to register them using the RC66 Canada Child Benefits Application.

Who is Ineligible?

CAIP is not offered to everyone. If you fall under the category given below you will not receive CAIP payment. 

• Individuals from British Columbia, Quebec, and the Northwest Territories.
• Failing to file tax returns 
• Don’t meet the age criteria

How to Get Your Carbon Tax Rebate?

The Carbon Tax Rebate is mostly paid on the 15th of each quarter, which is in April, July, October, and January. If the 15th falls on a holiday or weekend, the payment proceeds on the last working day before the 15th. The payments will be directly deposited to your bank account 

If you are a Canadian resident

Canadian residents don’t need to apply for the CAIP. The CRA will automatically calculate your eligibility to receive the payment and you will receive the payment if you file a federal tax return. 

In a family, only you or your spouse can get the payment. You and your spouse who files the tax return first, will get the payment. The amount will be the same if any of you receive the payment. You must file an income tax and benefit return every year even if you do not have an income to receive the CAIP each year.

If you are a new Canadian resident

• If you have children, you need to fill out and sign the Canada Child Benefits Application and RC66SCH form.  
• If you do not have a child, fill out the form RC151, GST/HST Credit and Climate action incentive payment application with your signature. 

How Much is the Carbon Tax Rebate?

The CAIP is not dependent on household income but the amount varies by province and family situation. The rural supplement amount for residents of small and rural communities is now 10%, which increases to 20% starting April 2024. 

Alberta

If you are a resident of Alberta, the first adult will receive $193 and the second adult will receive $96.50. Each child will receive $48.25 and if you are a family of four, you will get $386 in total. 

Manitoba 

An individual resident in Manitoba will receive $132 for the first adult and $66 for the second. Each child will receive $33 and a family of four will receive $264 in total. 

Ontario

An Ontario resident will receive $122 for the first adult and $61 for the second. Each child will receive $30.50; if you are a family of four, you will receive $244. 

Saskatchewan

In Saskatchewan, residents will receive $170 for the first adult and the second will receive $85. Children will receive $42.50 each and a family of four members will receive $340. 

Newfoundland and Labrador 

If you are a resident of Newfoundland and Labrador, the first adult from your family will receive $164 and the second adult will receive $82. Each of your children will receive $41. If your family belongs to four members, you will receive $328 in total. 

Nova Scotia

Residents from Nova Scotia will receive $124 for the first adult and $62 for the second. Each child will receive $31 and if your family belongs to four members, you will receive $248 in total. 

Prince Edward Island  

If you are a resident of Prince Edward Island, you will receive $120 for the first adult of your family and $60 for the second. Each child will receive $30 and if you have 2 children you will receive $240 in total. 

New Brunswick     

An individual who is a resident of New Brunswick will receive $92 for the first adult. The second adult will receive $46. Each child will receive $23; if your total family member is four, you will receive $184. 

You Don’t Receive Your CAIP, What Do You Do? 

If you haven’t received the CAIP, it may not be eligible or you may not have filed your previous year’s tax return. The first step you should take is to file your tax return correctly and on time. If you have filed your tax return on time but still haven’t received payment, you should directly take assistance from the CRA. The CRA can provide information on your payment status and help you to resolve it. Before looking for help, they usually advise you to wait until 10 business days after the scheduled payment. New residents of Canada need to fill out an application to receive the CAIP.