The Canada Caregiver Credit could become fully refundable under a Budget 2026 proposal designed to help eligible caregivers who have little or no federal tax payable.
The proposed change would apply to the 2027 and subsequent taxation years, allowing qualifying caregivers to receive the full value of the credit even when they cannot use a non-refundable credit to reduce their tax bill.
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What Budget 2026 proposes for the Canada Caregiver Credit
The federal government currently describes the Canada Caregiver Credit as a non-refundable tax credit for people who support a spouse, common-law partner or dependant with a mental or physical infirmity.
Budget 2026 proposes changing the credit so that eligible caregivers can receive its full value regardless of whether they owe enough federal income tax to use the existing non-refundable version.
The proposal would preserve the current design of the credit, including its maximum amounts, the income threshold at which the credit begins to be reduced and the existing phase-out approach.
The measure is a proposal from Budget 2026 and is not the same as a tax rule already in force.
How much caregivers could receive
For the 2027 taxation year, the government says eligible caregivers could receive up to $1,260 annually through the credit, with the maximum amounts indexed in later years.
The $1,260 figure applies to the highest 2027 Canada Caregiver Credit amount, which is listed at $9,001 before the lowest federal tax rate is applied.
Lower maximum amounts apply in other circumstances, including when the caregiver is claiming support for an infirm spouse or common-law partner, an eligible dependant or an infirm child under 18.
| 2027 credit situation | Maximum credit amount | Maximum tax relief listed by the government |
|---|---|---|
| Eligible infirm dependant in specified family relationships | $9,001 | Up to $1,260 |
| Infirm spouse, common-law partner or eligible dependant in specified circumstances | $2,812 | Up to $394 |
| Infirm child under 18 | $2,812 | Up to $394 |
The amount available can depend on the relationship between the caregiver and the person being supported, the dependant’s net income and whether another tax credit is claimed for that person.
Who could benefit from the refundable change
The government estimates that 585,000 caregivers would receive support under the proposed change.
That total includes about 180,000 caregivers who currently receive no benefit from the Canada Caregiver Credit because their federal tax payable is too low to use the non-refundable credit.
The federal government also estimates that making the credit refundable could lift an additional 15,000 people out of poverty.
Budget documents indicate that lower-income families would receive most of the additional support, with about 80 per cent expected to go to families with net income below $60,000 in 2027.
Caregivers aged 60 and older are expected to receive about 60 per cent of the additional support, while couples are expected to receive about 70 per cent.
When the proposed tax change would begin
The refundable version would apply to the 2027 and subsequent taxation years.
That means the change would generally be relevant when eligible caregivers file their 2027 income tax returns, rather than for the 2026 tax year.
The proposal is expected to provide $845 million in additional support over four years starting in 2027-28, followed by an ongoing annual cost of $245 million.
The maximum credit amounts and the income threshold would continue to be indexed after 2027 under the proposed design.
What caregivers should know now
Caregivers should not assume that the Budget 2026 proposal is already available as a refundable payment.
Until the measure is enacted and the Canada Revenue Agency publishes updated filing guidance, the existing rules for the non-refundable Canada Caregiver Credit continue to apply.
Under current CRA guidance, the credit may be available to people supporting an infirm spouse or common-law partner, child, grandchild, parent, grandparent, sibling, aunt, uncle, niece or nephew who meets the relevant conditions.
A dependant generally must rely on the caregiver for basic necessities such as food, shelter and clothing because of a mental or physical infirmity.
Eligibility and the amount available can change depending on the dependant’s income and the interaction with other credits, so taxpayers should keep supporting records and review the final CRA instructions once the legislation is passed.
The proposed change would give caregivers with low or no tax payable access to value that they may currently be unable to use, but it would not remove the existing eligibility requirements.
Frequently Asked Questions
What is changing with the Canada Caregiver Credit?
Budget 2026 proposes making the Canada Caregiver Credit fully refundable so eligible caregivers could receive its value even if they have little or no federal tax payable.
When would the refundable Canada Caregiver Credit start?
The proposal would apply to the 2027 and subsequent taxation years, subject to passage and implementation of the required legislation.
How much could an eligible caregiver receive?
For 2027, the government says the highest credit amount could provide up to $1,260 in annual tax relief. Lower maximum amounts apply in other caregiving situations.
Who could qualify for the Canada Caregiver Credit?
The credit may apply to people supporting an infirm spouse, common-law partner or qualifying dependant, including certain children, parents, grandparents, siblings, aunts, uncles, nieces and nephews.
Is the refundable caregiver credit already available?
No. Budget 2026 presents a proposal. Until it is enacted, the existing non-refundable Canada Caregiver Credit rules continue to apply.
Fact-Checked: Key amounts, eligibility details, estimated recipients, timing and funding figures were checked against Budget 2026, its tax-measures supplement and Canada Revenue Agency guidance.
Disclaimer: This article describes a proposed tax measure and is not personal tax advice; eligibility should be confirmed against final legislation and CRA instructions.