The Canada Revenue Agency (CRA) will be issuing the upcoming Climate Action Incentive Payment (CAIP) on October 13, 2023, to help individuals and families offset the cost of federal pollution pricing.
If you are a resident of Alberta, Saskatchewan, Manitoba, Ontario, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, or New Brunswick you can receive your Climate Action Incentive Payment (CAIP).
This guide will help you understand what CAIP is, who is eligible, how much you can receive, and when you can expect the payments.
What is Climate Action Incentive Payment or CAIP?
Climate Action Incentive Payment or CAIP is a tax-free payment designed to help Canadians offset the costs associated with federal pollution pricing. It’s often referred to as a carbon tax rebate.
Starting July 2022, CAIP is paid quarterly as tax-free payments through the benefit system, instead of being claimed annually on personal income tax returns.
CAIP is available to residents of specific provinces in Canada, including Ontario, Manitoba, Saskatchewan, and New Brunswick.
Who Is Eligible for Climate Action Incentive Payment (CAIP)?
To be eligible for CAIP, you need to meet certain criteria.
- First, you must be at least 19 years old at the beginning of the month when the Canada Revenue Agency (CRA) makes the payment.
- You must also be a resident of Canada for income tax purposes.
Additional Eligibility Criteria for Younger Individuals:
If you are under 19 years old, you can still qualify if you meet at least one of the following conditions:
- You have a common-law partner or spouse.
- You are a parent (or were one in the past) and currently or previously resided with your child.
If you have children, they must meet the following criteria at the beginning of the payment month to be considered eligible:
- They should be under 19 years of age.
- They must reside with you.
- You should be primarily responsible for their care and upbringing.
- Your child should be registered for the Canada Child Benefit, which will affect the CAIP calculation.
Eligibility for Newcomers to Canada:
Newcomers to Canada, including international students, work permit holders, and permanent residents, are eligible for CAIP.
However, newcomers need to apply for CAIP, unlike some other tax credit payments.
How to Apply for CAIP As a Newcomer:
If you are a newcomer to Canada, follow these steps to apply for CAIP:
Fill out one of the following forms based on your family composition:
If you have children, complete and sign Form RC66, Canada Child Benefits Application. Along with your Statement of Income, fill out Form RC66SCH, Status in Canada and Income Information for the Canada Child Benefits Application, to provide information about your citizenship and place of residence.
If you do not have children, fill out and sign Form RC151, GST/HST Credit and CAIP Application for Individuals Who Become Residents of Canada.
Send the completed form via mail to the tax center.
No Application Required for Non-Newcomers:
If you are not a newcomer to Canada, you do not need to submit a separate application for Climate Action Incentive Payment.
The Canada Revenue Agency (CRA) will automatically determine your eligibility when you file your income tax and benefit return and will send you payments if you’re entitled to them.
If you are eligible for Climate Action Incentive Payment (CAIP), you and your spouse or common-law partner (if applicable) must continue to file an income tax and benefit return annually to remain eligible for CAIP payments.
How Much CAIP Can You Receive?
The amount of CAIP you can receive is determined by your family’s circumstances and the province in which you reside.
Importantly, CAIP payments are not subject to a benefit reduction based on your family’s adjusted net income, making them a universal benefit.
Province-wise CAIP for 2023:
Here are the CAIP payment amounts for different provinces in 2023:
The Ontario program provides an annual credit of :
- Individual: $488
- Spouse or Common-law Partner: $244
- Child under 19: $122
- First child in a single-parent family: $244
The Manitoba program provides an annual credit of :
- Individual: $528
- Spouse or Common-law Partner: $264
- Child under 19: $132
- First child in a single-parent family: $264
The Saskatchewan program provides an annual credit of :
- Individual: $680
- Spouse or Common-law Partner: $340
- Child under 19: $170
- First child in a single-parent family: $340
The Alberta program provides an annual credit of :
- Individual: $772
- Spouse or Common-law Partner: $386
- Child under 19: $193
- First child in a single-parent family: $386
Additional Benefit for Rural Communities:
Residents of small and rural communities receive a 10% rural addition to the base CAIP amount.
For provinces not listed above, Climate Action Incentive Payment (CAIP) structures may vary. It’s essential to check with the Canada Revenue Agency (CRA) or consult their official website for specific details.
Newfoundland and Labrador (Quarterly):
- Individual: $164
- Spouse/Common-Law Partner: $82
- Per Child under 19: $41
- First Child in Single-Parent Family: $82
Nova Scotia (Quarterly):
- Individual: $124
- Spouse/Common-Law Partner: $62
- Per Child under 19: $31
- First Child in Single-Parent Family: $62
Prince Edward Island (Quarterly):
- Individual: $120 (includes 10% rural supplement)
- Spouse/Common-Law Partner: $60 (includes 10% rural supplement)
- Per Child under 19: $30 (includes 10% rural supplement)
- First Child in Single-Parent Family: $60 (includes 10% rural supplement)
New Brunswick (Quarterly):
- Individual: $92
- Spouse/Common-Law Partner: $46
- Per Child under 19: $23
- First Child in Single-Parent Family: $46
Special Double Payment for New Brunswick in October 2023:
In October 2023, residents of New Brunswick will receive a double Climate Action Incentive Payment, covering the months of October through December 2023 and July through September 2023.
Climate Action Incentive Payment (CAIP) Dates:
The upcoming Climate Action Incentive Payment (CAIP) dates are:
- October 13, 2023
- January 15, 2024
Payments are typically made on the final working day before the 15th of the month, except when the 15th falls on a Saturday, Sunday, or federal holiday.
If you receive your tax refund through direct deposit, you will also get your CAIP payments this way.
To enroll in direct deposit, visit the Direct Deposit web page for more information.
In your bank account, CAIP payments will be labeled as “Climate Action Incentive” (the wording may vary depending on your financial institution).
If you have a tax debt with the Canada Revenue Agency (CRA), your CAIP payments will be applied to any outstanding income tax balances or amounts owed to other federal or provincial government programs.
Didn’t Receive Your Payment
If you do not receive your CAIP on the expected payment date, it is recommended to wait for 10 working days before contacting the CRA for assistance.
Not Everyone Qualifies for Climate Action Incentive Payment (CAIP):
It’s important to note that not everyone in Canada is eligible for the Climate Action Incentive Payment.
CAIP is specific to residents of provinces that have a federal carbon pricing system in place, namely Ontario, Manitoba, Saskatchewan, and New Brunswick.
Eligibility criteria can vary, so it’s advisable to check with the Canada Revenue Agency (CRA) for precise information on who qualifies for the payment.
The Climate Action Incentive Payment (CAIP) is a valuable government initiative designed to provide financial support to residents of eligible provinces in Canada to help mitigate the costs associated with federal pollution pricing.
By understanding the eligibility criteria, payment amounts, payment schedule, and how to apply, you can make sure you receive the support you are entitled to.
Participating in programs like CAIP not only benefits you but also aids collective climate change efforts. Stay informed, check eligibility, and maximize this initiative for a greener future.
Every action matters; CAIP is your chance to make a difference. Stay updated with +1 News and make the most of this opportunity.