Refundable vs Non-Refundable Tax Credits
Which Canadian tax credits are refundable, which are not, and why it matters.
The short version
- Non-refundable credits reduce your tax, but only down to zero. Unused amounts are lost, except a few that carry forward or transfer.
- Refundable credits are paid to you even if you owe no tax at all.
- Most credits are non-refundable: the basic personal amount, age, disability, tuition, medical expenses, donations, CPP and EI.
- Refundable ones include the Canada Workers Benefit, the refundable medical expense supplement, the Canada training credit, the multigenerational home renovation credit and the eligible educator school supply credit.
- Low income? The refundable ones are where the money is. You only get them by filing.
Refundable vs. Non-Refundable Tax Credits
A non-refundable credit is a coupon you can only use if you're buying something: it takes money off your tax bill, and if there's no bill, the coupon does nothing. A refundable credit is a gift card: you get the value whether you buy anything or not. That one difference decides who benefits from which credits.
Non-Refundable Credits
These reduce federal tax by the credit amount times the lowest rate, 14% for 2026 (donations over $200 get a higher rate). They can bring your tax to zero, but not below.
| Credit | Notes |
|---|---|
| Basic personal amount | $16,452 for 2026 (less at high incomes) |
| Age amount | Up to $9,208, reduced above $46,432 of net income |
| Spouse or eligible dependant amounts | For supporting a lower-income spouse or dependant |
| Canada caregiver amount | For a dependant with an impairment |
| Disability amount | $10,341; can transfer to a supporting family member |
| CPP and EI contributions | From your T4 |
| Canada employment amount | $1,501 for employees |
| Pension income amount | On up to $2,000 of eligible pension income |
| Tuition | Unused amounts carry forward indefinitely, or transfer (up to $5,000) to a parent, grandparent or spouse |
| Medical expenses | Above the lesser of $2,890 or 3% of net income |
| Donations | Can be carried forward up to 5 years |
| Home buyers' amount, adoption, student loan interest | Specific conditions apply |
Run your own numbers in the income tax calculator to see how much tax there is for these credits to reduce; the rates behind it are on Canadian income tax brackets.
The catch for low-income earners: if the basic personal amount already wipes out your tax, the rest of these credits do nothing this year. That's why it pays to transfer them (tuition, disability) or carry them forward (tuition, donations, student loan interest) instead of letting them go to waste.
Refundable Credits
These are paid out in full, whether or not you owe tax:
| Credit | Line | What it is |
|---|---|---|
| Canada Workers Benefit | 45300 | For low-income workers; up to $1,665 single or $2,869 for families for 2026, plus a disability supplement |
| Refundable medical expense supplement | 45200 | Extra help for working people with high medical expenses |
| Canada training credit | 45350 | Builds up $250 a year (ages 26 to 65, with earnings) toward training fees |
| Multigenerational home renovation tax credit | 45355 | 14% (2026) of up to $50,000 to build a secondary suite for a senior or adult with a disability |
| Eligible educator school supply credit | 46900 | For teachers and early childhood educators buying supplies |
| CPP and EI overpayments | 44800, 45000 | Refunds of over-deducted contributions, common with two jobs |
| Provincial refundable credits | 47900 | Refundable credits from your provincial or territorial form; they vary by province |
The Canada Child Benefit and the Canada Groceries and Essentials Benefit (formerly the GST/HST credit) work like refundable credits but are paid separately as benefits, based on your return. More on all of them in Canadian tax credits.
Which refundable credits can you get?
Tell the assistant your income, family situation and province. It lists the refundable credits and benefits you likely qualify for, with rough amounts.
Why the Difference Matters
- Low income: non-refundable credits may be worth nothing this year. Refundable credits and benefits are worth full value, but only if you file. See do I have to file taxes in Canada.
- Couples: some non-refundable credits (donations, medical expenses) are better claimed by one spouse than the other. Medical expenses usually go on the lower-income spouse's return; donations are often pooled on one return to get past the $200 tier.
- Students: tuition that can't be used now carries forward or transfers. Never throw it away. Keep the T2202 and other proof; see what receipts to keep.
A refund isn't the same thing as a refundable credit, either; that confusion is sorted out on tax refund vs tax credit.
Missed One in a Past Year?
Credits from the last ten years can usually still be claimed by changing the return; see CRA Change my return. And before you file this year, Return Check flags credits that look missing from your return, including the transfers people forget.
Refundable Credit Questions
What is the difference between refundable and non-refundable tax credits?
Non-refundable credits reduce the tax you owe but cannot reduce it below zero. Refundable credits are paid to you even if you owe no tax.
Is the basic personal amount refundable?
No. The basic personal amount is a non-refundable credit. It reduces your tax to zero at most.
What refundable tax credits are there in Canada?
Federal examples include the Canada Workers Benefit, the refundable medical expense supplement, the Canada training credit, the multigenerational home renovation tax credit, the eligible educator school supply credit, and CPP or EI overpayments. Provinces add their own.
What happens to non-refundable credits I cannot use?
Most are lost, but tuition can be carried forward or transferred, donations and student loan interest can be carried forward, and some credits such as the disability amount can be transferred to a supporting family member.
Sources: CRA, Federal income tax and benefit information (refundable credits, lines 44000 to 47900); Canada Workers Benefit; Multigenerational home renovation tax credit; 2026 indexation table. Checked October 2026. Canada training credit and educator credit details are summarized; conditions apply.
Last reviewed October 5, 2026 against CRA and Government of Canada sources. How we check our facts.