Climate Action Incentive (CAI) – Gas Cost Relief Coming July 15

Evelyn Jacks

Planning a vacation with the kids in July? If you live in Manitoba, Ontario, Alberta or Saskatchewan, CRA will be sending you some gas money soon via the Climate Action Incentive – hundreds of dollars in fact - but only if you filed a 2021 tax return.  It’s not too late to get in on this and other social benefits that are paid after June 30; a quagmire of must-know tax info, your tax specialist can help you with before the holidays start.  Some details follow:    

How much is the CAI?  Previously claimed on the T1 as a refundable credit, the Climate Action Incentive (CAI) payments, are now scheduled for the 15th of April, July, October, and January of the following year.  However, for 2022 only, the first two payments will be combined and paid on July 15. Here’s what you can expect to receive:

Province

Taxpayer

Spouse/Eligible Dependant

Qualified Dep.

Family of Four

SK

$550

$275

$138

$1101

MB

$416

$208

$104

$832

ON

$373

$186

$93

$745

AB

$539

$270

$135

$1079

 

In order to receive this credit, the taxpayer must file a tax return. Rural taxpayers (those who live outside of a census metropolitan area) will receive 110% of the amounts above and must file Schedule 14 with their return to indicate that they live outside a Census Metropolitan Area.

In a year in which there is more than one residence, the credit will only apply to the location of the  principal residence, that is, the 10% rural supplement will not apply if you live in a metropolitan area and have a cottage that is outside a metropolitan area.

Owing Money to CRA?  If you have a balance due with CRA at the time of the scheduled payment, the payment will first be applied to reduce the balance due and payment will only be made for any amount of that exceeds the balance due.

Eligibility.  To receive each payment, the taxpayer must meet the eligibility requirements on the first day of the month to which the payment applies:

  • Be at least 19 years of age, married or living common law, or the parent of a child.
  • Live in an eligible province

Note that changes to province of residence and marital/parental status may affect eligibility and amount received, and are based on status as of the first day of the month of payment.

If a qualified dependant becomes age 19 during the year, their CAI will no longer be included in the CAI for their parent but will be paid separately to them, so long has they have filed a tax return for the previous year.  That’s just another reason for teenagers to start filing their tax returns at the age of 18. 

Not Eligible.  The following taxpayers are not eligible for the credit:

  • Taxpayers who died before the month to which the payment applies.
  • Prisoners who are incarcerated for 90 days (or more) that includes the first of the month to which the payment applies.
  • Non-residents on the first of the month to which payment applies (except spouses of individuals who are deemed resident throughout the year which includes the first day of the month to which the payment applies).
  • Children for whom an allowance is received under the Children’s Special Allowances Act

Other Provinces.  Other provinces have their own provincial climate action plans (carbon taxes) and may provide provincial tax credits.  See the following table for BC’s plan; other provinces have various energy efficiency and rebate programs related to electrical/fuel bills.

Prov

Tax

payer

Spouse/

Elig. Dep.

Qual. Dep.

Details

BC – for July 2022 to June 2023

$193.50

$193.50

$56.50

BC Low Income Climate Action Tax Credit (paid with GSTC)

Reduced by 2% of net income over $36,901 (single)/$43,051 (family)

For these reasons, taxpayers who change provinces during the year should inform CRA immediately so that their eligibility can be determined for the next CAI payment.

Additional educational resources: Help Canadians access tax benefits and programs that aid in their financial security. Earn new specialized credentials as a DFA-Personal Tax Services Specialist.