A growing number of Canadians are finding themselves at (or near) the age where they may be eligible to retire. Over the past few years, however, Canadians across all age groups are feeling financially tight. Older adults who, ideally, should be in a better position to look forward to retirement are looking for assistance with their monthly expenses. The Canadian Revenue Agency (CRA) administers several programs to help seniors with their monthly bills. Let’s learn a little more about Ontario tax credits that will help seniors with the cost of owning their homes.
Canadians struggling with the cost of living
A recent study by the Healthcare of Ontario Pension Plan (HOOPP) finds that Canadians are struggling financially, following the current period of rising inflation and interest rate hikes. Cost of daily living remains the top concern for adults ages 55-64 (71%), and 64% are questioning their ability to retire. Moreover, 44% of those still hoping to retire have less than $5,000 in savings; 75% have $100,000 or less in savings.
Many pre-retirement Canadians who own their own home are also worrying about their ability to retire. The HOOPP study says 34% are relying on the sale of their home to help fund their retirement. Additionally, 52% worry about what interest rates will do to others’ ability to buy a home from them as they approach retirement. For those pre-retirement homeowners with a mortgage, 27% are worrying about their ability to pay off their mortgage so that they can retire.
Available tax credits and grants for seniors
The Ontario Senior Homeowners’ Property Tax Grant (OSHPTG)
The intention of the OSHPTG is to help offset property tax costs for seniors who own their own homes and who have low to moderate incomes. This program is funded entirely by the Province of Ontario and the CRA administers it. The OSHPTG is an annual payment that seniors must apply for each year when they file their income tax. It’s a refundable tax credit that gives tax relief for principal senior homeowners. Seniors, or someone on your behalf, need to have made payments towards the property tax on the principal residence. The grant is an annual payment that you, as a senior, must apply for each year when you file your income tax and benefit return.
As a senior homeowner, you can apply for the current-year OSHPTG when you file your prior-year income tax and benefit return. The OSHPTG payment will be issued approximately four to eight weeks after your notice of assessment or reassessment will take place. The maximum grant is $500 for 2010 and later years.
Eligibility
You will qualify for this grant if you or your spouse/common-law partner, as of December 31 of the previous year:
- If you’re at least 64 years old
- You’re a resident of Ontario
- Paid Ontario property tax for the year
- Meet either of the following income requirements:
- Single, divorced, or widowed and earned less than $50,000
- Married or living common-law and you/your spouse/common-law partner earned a combined income of less than $60,000
- Own and occupy your principal residence
- You or your spouse or common-law partner owned and occupied a principal residence on December 31, 2023
- Not confined to a prison or similar institution on December 31, 2023, and for the next 179 days
- Filed an income tax and benefit return in which you include an application for the OSHPTG
How much is the Property Tax Grant?
The grant that you receive will depend on:
- The property tax paid
- Your adjusted family net income
- Marital status
Single, separated, divorced, or widowed: Your 2024 grant will be the maximum payment reduced by 3.33% of your adjusted net income over $35,000. Should your adjusted net income total $50,000 or more, you are not entitled to this grant.
Married or living in a common-law relationship: The 2024 grant will be the maximum payment reduced by 3.33% of your adjusted family net income over $45,000. If your adjusted family net income total $60,000 or more, you are not entitled to this grant.
How to apply for the OSHPTG
To apply for the Property Tax Grant, you have to file a 2023 income tax and benefit return. Additionally, you must complete the Application for the OSHPTG area on Form ON-BEN, the Application for the 2023 Ontario Trillium Benefit, and the Ontario Senior Homeowners’ Property Tax Grant. The OSHPTG is a non-taxable payment.
FAQS about Ontario tax credits and grants
Do I have to calculate the grant?
No. After you have applied, the grant will be calculated for you and if you are entitled, a payment will be issued. If you apply and are not eligible, in most cases, you will receive a notice explaining why.
If I pay rent, am I eligible to apply for the OSHPTG?
Unfortunately, no. To qualify for the OSHPTG, Ontario property tax must be paid on a principal residence you own.
Do I have to be a Canadian citizen to be eligible for a grant?
No. The grant is available to you, regardless of citizenship, as long as you are a resident of Ontario and meet the other eligibility criteria.
Will I receive the OSHPTG if I have any outstanding debt to the CRA?
Your OSHPTG payment will first be used to pay off any debt you owe to the CRA or its external partners. This includes family support orders that are in arrears. If any amount remains, it will be issued to you.
Do I have to own my home for a minimum number of years to be eligible?
Nope. As long as property tax is paid in respect of your residence for the current year, the duration of ownership is not relevant.
Who should I contact if I have a question about the policy on the OSHPTG?
You can call the Province of Ontario at 1-866-ONT-TAXS (1-866-668-8297) and ask for information on Ontario tax credits.
Potential OSHPTG fraud scheme
The Canadian Revenue Agency (CRA) is warning Canadians about a scheme involving the OSHPTG. Schemers claim they can get a tax refund for taxpayers relating to the grant. It targets seniors living in a multi-generational family household owned by their children or grandchildren. A fraudster tells the senior that he or she can increase their tax refund. They suggest that the homeowner transfer an interest in the residence to the senior resident, sometimes without their family’s knowledge. However, fraudsters will then prepare the income tax and benefit returns for the entire household as one financial unit. They claim the grant on the senior’s return by misrepresenting the senior’s homeownership.
CRA says the grant is only for individuals who own their principal residence. Those who choose to participate in these schemes and those who promote them face serious consequences. These include penalties, court fines, and even jail time.
Other Ontario tax credits available for seniors
With the economy the way it is, all Canadians can benefit from some tax breaks. Seniors can benefit from tax grants being offered by the government. Here is a brief list of other available tax credits:
The Ontario Care At Home Tax Credit
This is a newer government program to promote home support for seniors. Available since 2022, this financial support takes the form of a refundable tax credit. This means that, even if you don’t have to pay any tax this year, you will still be able to receive the money you are eligible for.
Seniors’ Home Safety Tax Credit
The objective is to allow Ontario older adults to adapt their homes to accommodate new challenges that may arise over time.
Ontario Seniors’ Public Transit Tax Credit
This is for seniors choosing to continue living at home after retirement. Its purpose is to encourage Ontario seniors to use public transportation services (such as buses, subways, and trains), while maintaining maximum freedom in their daily lives.
Canada Caregiver Credit
Available both in Ontario and throughout the country, this credit is available to caregivers who aid with a close loved one daily. You may be able to apply for this federal financial support as a family caregiver if you devote a significant portion of your time to an elderly relative.
