Navigating Canada’s Tax Benefits and Credits for Newcomers

Moving to Canada opens up a world of opportunities, including access to various benefits and tax credits designed to support both permanent residents and temporary visa holders.

These provisions, overseen by the Canada Revenue Agency (CRA), aim to provide financial assistance to newcomers during their transition and settlement in the country.

Understanding Newcomer Status

Newcomer status under the CRA applies during an individual’s first year of residence in Canada. To qualify for benefits and credits, either the newcomer or their spouse/common-law partner must be considered a resident of Canada for income tax purposes.

Securing Your Social Insurance Number (SIN)

Before accessing benefits and credits, newcomers must obtain a Social Insurance Number (SIN) from Service Canada. This unique 9-digit identifier is essential for various purposes, including receiving payments, working, and opening bank accounts. SIN applications can be completed online, in person at a Service Canada Centre, or through mail.

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In cases where Service Canada is unable to provide a SIN immediately, the CRA may issue a temporary tax number (TTN) to facilitate access to benefits and online services.

Applying for Benefits and Credits

Newcomers are eligible for benefits and credits without the requirement of filing their first tax return. Some of the key benefits include:

• GST/HST Credit and Canada Carbon Rebate: Offset taxes paid on purchases with a tax-free quarterly payment.
• Canada Child Benefit (CCB): Monthly tax-free payments to assist with raising children under 18 years old.

Temporary residents become eligible for the CCB after residing in Canada for 18 consecutive months and holding a valid permit on their 19th month.

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Provincial and Territorial Benefits

Beyond federal benefits, many provinces and territories offer additional support programs, including:

• Alberta:
  • Alberta Child and Family Benefit
• British Columbia:
  • BC Family Benefit
  • BC Climate Action Tax Credit
• New Brunswick:
  • New Brunswick Child Tax Benefit
  • New Brunswick Working Income Supplement
  • New Brunswick Harmonized Sales Tax Credit
• Newfoundland and Labrador:
  • Newfoundland and Labrador Child Benefit
  • Newfoundland and Labrador Income Supplement
  • Newfoundland and Labrador Disability Amount
  • Newfoundland and Labrador Seniors’ Benefit
• Nova Scotia:
  • Nova Scotia Child Benefit
  • Nova Scotia Affordable Living Tax Credit
• Northwest Territories:
  • Northwest Territories Child Benefit
  • Northwest Territories Cost of Living Offset
• Ontario:
  • Ontario Trillium Benefit
  • Ontario Energy and Property Tax Credit
  • Northern Ontario Energy Credit
  • Ontario Sales Tax Credit
  • Ontario Child Benefit
  • Ontario Senior Homeowners’ Property Tax Grant
• Prince Edward Island:
  • Prince Edward Island Sales Tax Credit
• Quebec:
• Saskatchewan:
  • Saskatchewan Low-Income Tax Credit
• Yukon:
  • Yukon Child Benefit
  • Yukon Government Carbon Price Rebate – Individuals

Further Benefits and Credits

After filing their first tax return, newcomers may qualify for additional benefits such as:

• Canada Dental Benefit
• Disability Tax Credit (DTC)
• Canada Workers Benefit
• Home Accessibility Tax Credit
• Children’s Special Allowances
• COVID-19 Benefits from the CRA

Receiving Payments

To receive benefits and credits, individuals can sign up for direct deposit into their Canadian bank accounts. It’s essential to file income tax returns annually, even with no income, and keep personal information updated with the CRA.

Navigating Canada’s tax system as a newcomer can be complex, but understanding and accessing available benefits and credits can significantly ease the transition and provide valuable financial support during settlement.