$7500 Home Renovation Tax Credit in Canada, How Seniors, Caregivers and Disabled Adults Can Claim Thousands

If you’re planning to renovate your home for a loved one or live with a disability yourself, June 2025 brings major financial support your way.

Two new federal programs—the \$7,500 Multigenerational Home Renovation Tax Credit (MHRTC) and the monthly \$200 Canada Disability Benefit (CDB)—are designed to make home upgrades and daily living more affordable.

Whether you’re a homeowner, family caregiver, or someone approved for the Disability Tax Credit (DTC), this guide explains who qualifies, how to apply, and how to maximize your refund.

Programs at a Glance

Here’s a quick snapshot of both benefits:

Program	Target Group	Amount	How to Claim
MHRTC	Homeowners adding a suite for seniors or DTC adults	Up to \$7,500 (15% of \$50,000)	File with 2025 tax return, Schedule 12
CDB	Canadians aged 18–64 with DTC	Up to \$200/month (\$2,400/year)	Apply June 20–Dec 31 via CRA My Account

Together, these programs support multigenerational living and offer stable income to people with disabilities.

Why These Programs Matter

Multigenerational living has become more common in Canada, helping families cut housing costs, provide in-home care, and strengthen family ties.

The MHRTC eases the financial strain of building or renovating a secondary suite, while the CDB ensures those with disabilities have ongoing support for daily expenses. Both aim to create inclusive, affordable living arrangements that benefit families and communities.

The \$7,500 Multigenerational Home Renovation Tax Credit (MHRTC)

The MHRTC offers up to \$7,500 in refundable tax credits for homeowners who build or renovate a secondary suite for an eligible relative.

Eligibility Requirements

• You must own and live in the home.
• Renovations must take place in 2025.
• The new suite must house:
• A senior aged 65+
• An adult approved for the Disability Tax Credit
• The suite must include:
• A private entrance
• Kitchen
• Bathroom
• Bedroom
• Renovations must meet local building codes and zoning laws.

How to Claim

• Save receipts, permits, and photos of the project.
• File Schedule 12 with your 2025 tax return.
• Claim on line 45355 of your tax form.
• Only one claim per eligible person per lifetime is allowed.

The \$200 Canada Disability Benefit (CDB)

The new CDB offers monthly payments of up to \$200 (\$2,400 annually) for Canadians aged 18 to 64 who are approved under the DTC.

Key Dates

• Applications open June 20, 2025, and close December 31, 2025.
• First payments begin July 2025 for those approved by June 30.
• Retroactive coverage available for up to 24 months, even if the applicant is now over 65.

Income Reductions

• First \$23,000 exempt for singles and \$32,500 for couples.
• First \$10,000 (single) or \$14,000 (couples) in working income excluded.

Example Case
Dan, a DTC-approved adult earning \$35,000:

• Subtract \$10,000 working income → \$25,000
• Subtract \$23,000 exempt → \$2,000
• Reduction = \$400 (20% of \$2,000)
• Final benefit = \$2,000 per year or about \$166/month

How to Apply for Both Programs

Step 1 – Disability Benefit (CDB)

• Download and submit Form T2201.
• Have your doctor complete the medical section.
• Submit via mail or CRA My Account.

Step 2 – Renovation Planning (MHRTC)

• Get quotes from contractors.
• Budget for permits, inspections, and unexpected costs.
• Explore financing options such as HELOCs, personal loans, or provincial programs.

Step 3 – Secure Permits

• Apply with your municipality.
• Ensure compliance with accessibility standards (e.g., ramps, grab bars).

Step 4 – Track Expenses

• Save all receipts and invoices.
• Keep digital records or use budgeting apps.

Step 5 – File and Receive Benefits

• Claim MHRTC on Schedule 12 in 2025.
• Apply for CDB once you receive a CRA code.
• Expect MHRTC refunds in early 2026 and monthly CDB payments from July 2025 onward.

Tips for Maximizing Benefits

• Always budget 10–15% extra for unexpected renovation costs.
• Check for provincial programs that stack with federal credits:
• BC: Up to \$1,000 renovation credit
• Ontario: Accessibility and transit tax supports
• Quebec: Home adaptation grants
• Use a tax professional to combine MHRTC with HATC, Medical Expense Credit, or Caregiver Credit.

Real-Life Example

The Patel family in Ottawa converted their garage in 2025 to house Anjali’s 70-year-old mother.

• Renovation cost: \$48,000
• MHRTC claim: \$7,200
• Additional HATC credit: \$1,500
• Their son, DTC-approved, received \$200/month CDB starting in July.

By the end of the year, the family gained \$8,700 in tax credits and disability support, turning a major renovation into an affordable investment in family care.

FAQs

Q1: Who qualifies for the MHRTC in 2025?
Homeowners who build or renovate a suite for a senior (65+) or a DTC-approved adult qualify.

Q2: How much can I claim under the MHRTC?
Up to \$7,500, which is 15% of \$50,000 in eligible expenses.

Q3: When do Canada Disability Benefit (CDB) payments begin?
Payments start in July 2025 for those approved by June 30.

Q4: Can I combine MHRTC with other credits?
Yes, it can be stacked with programs like the Home Accessibility Tax Credit and Medical Expense Credit.

Q5: Is the CDB income-tested?
Yes. Reductions apply above \$23,000 (single) or \$32,500 (couples), with partial exemptions for working income.