Carbon Tax Rebate Increase 2024 Eligibility, Amount, and Payout

Carbon Tax Rebate Increase 2024

The Canadian government’s carbon pricing plan, known as the Climate Action Incentive (CAI), includes a rebate system to offset the increased costs associated with a carbon tax.

As of April 1, 2024, the federal carbon price has increased from $65 to $80 per ton, which could impact household budgets. The good news, however, is that the carbon tax credit has also seen a corresponding increase to help ease this burden.

Carbon Tax Rebate Eligibility 2024

Key eligibility criteria for receiving a Carbon tax Rebate:

• You must be a resident of Canada for tax purposes on the first day of the month the payment is issued.
• You must reside in a province that applies the federal fuel charge. This excludes provinces with their carbon pricing systems like Quebec and British Columbia.
• You must be at least 19 years old at the start of the payment month. Exceptions apply for individuals under 19 with a spouse/common-law partner or those who are/were parents living with a child.
• You must have filed your income tax return for the previous tax year.
• Eligible Child:
  • Your child must be under 19 years old.
  • Your child lives with you.
  • You are primarily responsible for their care and upbringing.
  • Your child is registered for the CCR (or already registered for the CCB or GST/HST credit).
• Income Thresholds: The rebate amount varies based on your province of residence and total income for the previous tax year. 
  • Individual: Eligible for a full rebate if your income falls below a certain threshold (around $49,143 for 2023). The rebate amount gradually decreases as your income increases.
  • Families: The income threshold for receiving the full rebate is higher for families, considering additional household members.

Carbon Rebate Schedule 2024

The Canada Carbon Rebate is distributed four times a year through direct deposit or cheque. Here’s the schedule for 2024:

• First Payment: April 15, 2024 
• Second Payment: July 15, 2024
• Third Payment: October 15, 2024
• Fourth Payment: January 15, 2025

• If the 15th falls on a weekend or statutory holiday, the payment will be issued on the last business day before that date.
• To ensure you receive the first payment on time (April 15, 2024), you have to file your income tax return electronically by March 15, 2024. 
• If you filed after this date, your first payment will be included in a subsequent payment after your return is processed.

Carbon Tax Rebate Amounts 

The Canada Carbon Tax Rebate amount includes;

• Individual Rebates:
  • A full rebate is available for individuals with income below a specific threshold (approximately $49,143 for 2023).
  • The rebate amount gradually decreases as your income increases beyond the threshold.
• Family Rebates:
  • The income threshold for receiving the full family rebate is higher than for individuals, reflecting additional household members.
  • Similar to individuals, the rebate amount for families reduces as income rises.
• Average Rebates (2024): The government provides average rebate figures to give a general idea. These figures are not guaranteed and can vary based on your specific situation. Here are some examples:
  • Average Individual Rebate: $1,056
  • Qualified Households: $1,779 (may include more than two adults)
  • Alberta Family of Four: $1,800 (distributed quarterly as $450 per payment)

Factors Affecting Canada Carbon Tax Rebate 2024

Here’s a breakdown of the key factors affecting the Canada Carbon Tax Rebate amount:

Province of Residence:

• The federal carbon tax rebate applies only in provinces that adhere to the federal fuel charge. 
• Provinces with their carbon pricing systems, like Quebec and British Columbia, have separate rebate structures.

Total Income:

• The Canada Carbon Rebate is designed to be more beneficial for low- and middle-income earners.
• Individuals with income below a specific threshold (around $49,143 for 2023) receive the full rebate amount.

Family Size:

• The rebate program acknowledges the additional expenses faced by families. 
• Therefore, families with more dependents generally qualify for higher rebate amounts compared to single individuals.

Rural vs. Urban Location:

• While not a major factor, there’s a rural supplement that provides a slight increase in the rebate for residents of small and rural communities. 
• Starting in April 2024, this rural supplement is expected to increase to 20% of the base rebate amount (pending Royal Assent).