$7,500 CRA Home Renovation Bonus Drops in April: If you’re planning a home renovation to support a family member, the $7,500 CRA Home Renovation Bonus could be the financial boost you need. Officially known as the Multigenerational Home Renovation Tax Credit (MHRTC), this new initiative from the Canada Revenue Agency (CRA) offers eligible Canadians a refundable tax credit of up to $7,500 starting in April 2024.
This article provides a comprehensive guide to the MHRTC, who can claim it, how to qualify, and how to apply. Whether you’re a homeowner caring for a senior parent or a professional helping clients understand their tax benefits, this is your go-to resource. It’s written in a way that’s simple enough for anyone to follow, yet detailed and accurate enough for tax professionals and advisors to rely on.
$7,500 CRA Home Renovation Bonus Drops in April
| Feature | Details |
|---|---|
| Program Name | Multigenerational Home Renovation Tax Credit (MHRTC) |
| Launch Date | April 2024 |
| Maximum Credit | $7,500 (15% of eligible expenses up to $50,000) |
| Eligible Expenses | Renovation costs to build a self-contained secondary unit |
| Who Qualifies | Seniors (65+) or adults eligible for the Disability Tax Credit and their families |
| How to Claim | File with Schedule 12 and Line 45355 on your tax return |
| Official Source | Government of Canada – CRA |
The $7,500 CRA Home Renovation Bonus is more than just a tax perk—it’s a valuable financial and emotional support system for families choosing to live together. It helps ensure our seniors and loved ones with disabilities can enjoy a safe, accessible living space while staying close to the people who care about them most.
What Is the CRA $7,500 Home Renovation Bonus?
The MHRTC is a refundable tax credit, meaning that you can get money back even if you owe no taxes. It was introduced by the Canadian government to support multigenerational living, specifically encouraging families to renovate their homes to accommodate senior citizens or those eligible for the Disability Tax Credit (DTC). The goal is to help families care for their loved ones at home, rather than relying on expensive long-term care facilities.
Why This Matters
With the rising cost of eldercare, shortages in senior housing, and increasing demand for accessible home features, the MHRTC fills a vital need. According to Statistics Canada, the number of seniors in Canada is projected to reach 9.5 million by 2030. At the same time, more than 22% of Canadians live in multigenerational households. This tax credit acknowledges a growing social and economic trend—keeping family close, under one roof.
Who Is Eligible for the MHRTC?
To qualify for the MHRTC, both the individual benefitting from the renovation and the claimant must meet specific conditions.
Qualifying Individual
The person who will live in the renovated unit must be:
- 65 years or older by the end of the renovation year; or
- 18 years or older and eligible for the Disability Tax Credit at any point during the tax year.
Eligible Claimant
The person claiming the tax credit must:
- Be a Canadian resident throughout the tax year.
- Be a qualifying relation to the individual (examples include a parent, child, sibling, grandparent, aunt, uncle, niece, or nephew).
- Own or co-own the home or be a beneficiary of a trust that owns the home.
- Intend to reside in the dwelling with the qualifying individual within 12 months of completing the renovation.
These criteria ensure the benefit goes to genuine multigenerational households and not to commercial investors or landlords.
What Renovations Qualify?
The renovations must result in the construction of a self-contained secondary unit within an existing residential property. This secondary unit must include:
- A separate entrance
- A bedroom or sleeping area
- A kitchen or kitchenette
- A full bathroom with toilet, sink, and bath or shower
Common Renovation Examples
- Turning a basement into an in-law suite for a senior parent
- Converting a detached garage into a studio apartment for a disabled sibling
- Modifying a main-floor room with a full ensuite and kitchenette for easier mobility
These renovations must comply with all municipal zoning regulations, building codes, and permitting requirements. Keep in mind that unpermitted or substandard renovations will not be eligible.
How Much Can You Claim From CRA Home Renovation Bonus?
The MHRTC allows you to claim 15% of qualifying renovation expenses, up to a maximum of $50,000. This equals a potential refund of up to $7,500.
Example: If your renovation costs $30,000, your tax credit will be $4,500. If you reach the $50,000 cap, you can claim the full $7,500.
You can also split the credit between multiple family members who contribute financially to the project. For instance, two siblings sharing costs for their parent’s suite can each claim part of the total, as long as the combined claim doesn’t exceed the maximum.
How to Claiming the MHRTC
Step 1: Plan and Budget
Before starting, assess your home layout and determine how a secondary suite can be created. Hire a licensed contractor to draw up plans and confirm compliance with local laws.
Step 2: Collect Documentation
Save every invoice, quote, permit, and contract related to the renovation. This includes:
- Contractor invoices
- Building permits
- Materials receipts
- Inspection approvals
Step 3: Complete the Renovation in the Same Tax Year
Ensure all work is completed within the same calendar year you intend to claim the credit. Delays may disqualify your claim.
Step 4: File Your Taxes
When tax season arrives:
- Fill out Schedule 12 (MHRTC)
- Enter the total claim amount on Line 45355 of your federal return
- Be ready to provide documents if CRA requests them during a review
Professional Tips and Expert Advice
- Work with a certified contractor who has experience building secondary suites. They’ll be familiar with local requirements and can help avoid costly mistakes.
- Use a tax professional if you have a complex family or financial situation.
- Combine the MHRTC with other benefits like:
- The Home Accessibility Tax Credit (HATC)
- Provincial programs like Ontario’s Healthy Homes Renovation Tax Credit (if available)
By stacking credits legally, you could save thousands more.
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FAQs About $7,500 CRA Home Renovation Bonus Drops in April
Can I claim the MHRTC and the HATC for the same project?
Yes, if the expenses meet the criteria for both. You must keep clear records and avoid double-counting the same costs.
Can the renovated suite be used as a rental?
No. The unit must be intended for personal use by the qualifying individual and their family.
Can I still qualify if I do the renovations myself?
Possibly. Materials are eligible, but labor must be from arms-length contractors. Your own time or labor isn’t eligible.
How do I prove someone qualifies for the Disability Tax Credit?
You need a valid T2201 Disability Tax Credit Certificate, approved by the CRA.
What happens if I sell the home after claiming the credit?
There’s no clawback, but if the renovation was never used by the qualifying individual, CRA may audit your claim.
Is this credit permanent?
As of now, the MHRTC is expected to be a permanent fixture in the Canadian tax system, but it’s best to apply while it’s active.
