In 2022, the federal government announced several measures aimed at helping Canadians deal with the rising cost of living, including a temporary doubling of the GST credit and new tax-free first-time homebuyer savings accounts. The latest to receive royal assent is a one-time "top-up" of the Canada Housing Benefit, which will give eligible tenants an extra $500 to help cover their rent.
Here's what you need to know about the Canada Housing Benefit.
What is the Canada Housing Benefit top-up?
The supplement is part of a package of programs, the Cost of Living Relief Act, No. 2 (Targeted Support for Households), that received royal assent on November 17.
This new measure will grant a tax-free payment of $500 to an estimated 1.8 million low-income renters in Canada who are struggling with the rising cost of housing.
Who is eligible for the Canada Housing Benefit $500 top-up?
According to criteria listed online, you must be at least 15 years old with a primary residence in Canada on the first day of December 2022.
Second, you must have been a resident of Canada in 2022 who filed a 2021 income tax return or statement of income. The same applies to your spouse or common-law partner if you have one.
You must also have had an adjusted net 2021 income of $35,000 or less for families, or $20,000 or less if you're single. And finally, in 2022, you must have paid at least 30% of the value of your 2021 adjusted net income on rent for your main residence in Canada.
If you meet all the listed criteria, you may be eligible to apply for the top-up.
How do you apply for the Canada Housing Benefit top-up?
Applications open on December 12, 2022 on the official government of Canada website.
Before you apply, make sure you have filed your 2021 income taxes and that you have your rent information, including the address of your principal residence, the amount you paid for rent in the 2022 calendar year as well as the name and contact information of the property's owner.
Then, you must set up a CRA My Account (Canada Revenue Agency's online portal) and set up direct deposit with the CRA. They will administer the one-time payment.
What other measures has the government announced?
Other measures to counter the burden of inflation and housing costs on Canadian households are in the works.
For instance, the federal government expects to launch a new tax-free first home savings accounts in mid-2023 so that young Canadians can afford a down payment more quickly. If you're hoping to buy your first house in the coming years, you could save up to $40,000 tax-free, according to an online summary.
And beginning January 1, 2023, foreign purchases of homes in Canada will be banned for two years with the aim of ensuring domestic housing stock remains available for Canadians to use as residences instead of sitting empty.
There's also that temporary doubling of the GST credit, through which eligible households will receive twice as much as they usually would in a six-month period to offset the burden of the federal sales tax.
Another measure planned for 2023 is a "refundable multigenerational home renovation tax credit," through which families could get up to $7,500 for building a suite for a senior or an adult with a disability.