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What is the climate action incentive and can I claim it?

What is the climate action incentive?

The climate action incentive is a new refundable tax credit for residents of Manitoba, New Brunswick (2018 only), Ontario, Saskatchewan, and Alberta (2019 onwards). Starting in April 2019, residents of these provinces will be charged a new federal carbon tax. The climate action incentive is to compensate you for your increased expenses.

Can I claim the climate action incentive?

Most residents of Manitoba, New Brunswick (2018 only), Ontario, Saskatchewan, and Alberta (2019 onwards) can claim the new climate action incentive. You can claim it as long as you:

  • were a resident of Canada throughout ,
  • weren’t confined to a prison or a similar institution for a period of at least 90 days during ,
  • weren’t exempt from income tax in Canada at any time in because they were an officer or servant of the government of another country, such as a diplomat, or a family member who resided with such a person, or an employee of such a person,
  • weren’t a person in respect of whom a children’s special allowance was payable at any time in ,
  • didn’t die before April 1, , and
  • your partner hasn’t claimed it.

How do I claim it?

You claim it on your tax return. Answer “Yes” to the question “Will you claim the climate action incentive (carbon tax credit)” in the About You section. If you don’t see this question, it means that you do not qualify.

Who should claim it, me or my partner?

For the most part, it doesn’t matter. If only one of you qualifies, that person must claim it.

I don’t live in a small or rural community, can I still claim it?

Yes. The small and rural communities supplement is simply an extra 10% for residents of small and rural communities.

I live in another province, why can’t I claim it?

You aren’t eligible for the climate action incentive because the new federal carbon tax is not coming to your province (your province either has or is implementing its own carbon pricing plan).