Budget 2026 proposes making the Canada Caregiver Credit fully refundable

Budget 2026 proposes turning the existing non-refundable Canada Caregiver Credit into a fully refundable credit worth up to $1,260 in 2027 so caregivers with little or no tax to pay can receive support in cash, with Canada Revenue Agency eligibility rules still applying.

Budget 2026 proposes to make the existing Canada Caregiver Credit fully refundable, so eligible caregivers could receive up to $1,260 a year for 2027, with the amount indexed in later years. The Department of Finance Canada key measures backgrounder lists a Refundable Canada Caregiver Credit among the budget's affordability tools, and Budget Chapter 3 says the change would start in 2027-28.

Under today's rules, the Canada caregiver credit is a non-refundable tax credit. It can lower the federal tax a person owes when they support a spouse, common-law partner or eligible dependant who has a mental or physical infirmity, but it does not pay cash to people who owe little or no tax. Budget Chapter 3 says many caregivers have incomes too low to pay tax and therefore do not fully benefit from the existing credit.

According to the budget documents, making the credit refundable would provide $845 million in additional support over four years, starting in 2027-28, and $245 million a year ongoing. The budget projects that 585,000 caregivers would receive support, including 180,000 who currently receive no benefit, and that the change could lift an estimated additional 15,000 individuals out of poverty.

Who can claim the credit today

The Canada Revenue Agency's caregiver credit page says you may be able to claim the Canada caregiver credit if you support your spouse or common-law partner who has a mental or physical infirmity. You may also claim it if one or more of the following people depend on you for support because of a mental or physical infirmity: your or your partner's child or grandchild; or your or your partner's parent, grandparent, brother, sister, aunt, uncle, niece or nephew, if they resided in Canada at any time in the year.

The same Canada Revenue Agency guidance adds that a person is considered dependent on you for support if they regularly and consistently rely on you for basic necessities such as food, shelter and clothing. The amount you can claim depends on your relationship to the dependant, your circumstances, the dependant's net income, and whether other credits are claimed for that person. The agency may ask for a signed statement from a medical practitioner about when the infirmity began and how long it is expected to last.

That eligibility test is narrower than simply caring for an elderly parent. Under Canada Revenue Agency rules, the dependant generally needs a mental or physical infirmity and must regularly and consistently rely on the claimant for basic necessities such as food, shelter and clothing, and the amount claimed also depends on the dependant's net income and whether other credits are claimed for that person.

What Budget 2026 would change

The Globe and Mail, in a 5 November 2026 report on Prime Minister Mark Carney's budget, said the government would turn the Canada Caregiver Credit for Canadians who look after adults with disabilities into a refundable tax credit so the aid reaches caregivers whose incomes are too low to pay tax, with eligible Canadians able to receive up to $1,260 for 2027.

Budget 2026 proposes the change; the budget documents describe caregivers receiving up to $1,260 annually for 2027, indexed thereafter. Filipinos in Canada who support an eligible spouse, partner or relative should check current Canada Revenue Agency caregiver credit rules for their own situation rather than treating the figure as an automatic payment.

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