FEATURE Ottawa’s proposed caregiver tax credit would reach some people who owe no federal income tax. For families giving up paid hours to provide care, the amount and timing of that help matter. Pamela was 49 and five years from retirement eligibility when she left work to care for her father. Her mother and husband later needed care, too. The Nova Scotia woman spent more than a decade out of the workforce, according to her account in a 2026 report by the Canadian Centre for Caregiving Excellence. Leaving work cost her a paycheque right away. The effect on her retirement income took longer to see. “It’s a big surprise when they go to draw CPP—as it was for me,” she told the centre, describing the years she missed contributing to the Canada Pension Plan. Service Canada bases the pension in part on a person’s earnings and contributions over their working life, with provisions that can exclude some low-earning years. The federal budget tabled Nov. 5 proposes making the Canada Caregiver Credit refundable starting with the 2027 tax year. Today, the credit can reduce a federal income tax bill to zero. That can make it worth less to someone whose earnings drop when they take time away from work to provide care. Under the proposal, an eligible caregiver could receive the portion of the credit left over after their tax bill reaches zero. Finance Canada estimates that 585,000 caregivers would benefit, including about 180,000 who get no relief from the existing credit. The department projects $845 million in additional support over four fiscal years starting in 2027–28. What a year can cost Seven per cent of unpaid caregivers for children or adults said they had to reduce their usual weekly work hours in Statistics Canada’s 2022 survey. The survey covered people aged 15 and older living off reserve in the provinces. When care lasts a year, a few missed hours every week can change what a family can afford. Take a hypothetical worker who earns $25 an hour and gives up four paid hours a week to care for a parent. Over 52 weeks, that comes to $5,200 in wages before tax. If the worker qualifies for the proposed maximum of $1,260, the credit would be worth just under a quarter of those gross wages. Their loss in take-home pay would depend on taxes and payroll deductions. In that example, if the worker owed $300 in federal income tax before the caregiver credit, the current design would save them $300. Under the proposal, the other $960 would be paid to the worker. That is the amount of new relief for this household. Paying someone to help with care can add to the strain. In a weighted online survey that Leger conducted for the centre in 2025, about one in five unpaid caregivers surveyed reported spending at least $1,000 a month out of pocket on care. For someone spending $1,000 a month and receiving the full credit, the annual payment would cover a little more than one month of those expenses. Whose care qualifies The Canada Revenue Agency’s guide covers spouses, common-law partners and specified relatives who need support because of a physical or mental impairment. For a dependant, the agency looks for regular help with necessities such as food, shelter or clothing. In Statistics Canada’s survey, 15 per cent of unpaid caregivers for adults with long-term conditions or disabilities reported caring for a friend, colleague or neighbour. Those relationships on their own fall outside the credit’s eligibility rules. The amounts also vary by relationship. For a qualifying adult dependant such as a parent, the 2027 maximum would be $1,260. The amount starts to fall once that parent’s net income exceeds $21,136. The caregiver amount for a qualifying child under 18 at year-end would be capped at $394. Parents can check the agency’s guide for the requirements around a child’s need for substantially more personal care than other children the same age. The agency may ask for a signed statement from a medical practitioner about when the impairment began and how long it is expected to last. The agency can use an approved Disability Tax Credit Certificate already on file for that period. For a household estimating what it might receive, the guide is a place to check which claim applies and which records to keep. The credit is claimed on an income tax return. People with modest incomes and straightforward tax situations can check the agency’s free tax clinic directory for help preparing a return. Help before tax time If Parliament enacts the change as proposed, the first claims would be for 2027, generally filed in 2028. Someone who gives up a shift in January would absorb the lost wages on their next paycheque. Employment Insurance can provide up to 15 weeks of benefits to eligible workers who take time away from work to care for a critically ill or injured adult. Service Canada also accepts claims from people considered like family. For a person with a chronic condition, the critical illness rules require a significant change in their health due to a new, acute life-threatening event. A caregiver supporting someone through a gradual decline can face years of decisions about which shifts they can work. Pamela told the centre that Nova Scotia Health Continuing Care helped pay for part-time care that allowed her family to stay at home. A home support visit that covers the time a caregiver needs to be away can help them keep a shift. Families looking for that kind of help can ask their provincial or territorial home care office when visits could start and how often they could expect them. The same federal budget proposes extending funding agreements with provinces and territories for home and community care, mental health and addictions services through March 2028. Provinces and territories could show families what that support delivers by reporting the time between assessment and a first visit, and how many hours of home support people receive compared with the hours their assessments identify. After the first year of claims, Ottawa can report how many more caregivers receive the credit and how much they receive. That would give families a way to judge whether the new credit reaches the people it was designed for. For someone weighing the choice Pamela faced, the ability to keep a shift also matters beyond the next paycheque. It can help them keep contributing to a pension they will depend on years later. SDG context The United Nations’ gender equality goal calls for recognizing unpaid care through measures including public services and social protection. Among people providing unpaid care to adults in Statistics Canada’s 2022 survey, women reported a median of 10 hours a week and men six. Tracking unpaid care hours and changes in paid work over time would show whether that burden is becoming more evenly shared. Sources referenced Canadian Centre for Caregiving Excellence. Caring in Canada 2026, including Pamela’s account and the 2025 National Caregiving Survey. Finance Canada, Nov. 5, 2026. Budget 2026 affordability chapter and tax measures. Canada Revenue Agency. Canada caregiver credit eligibility and documentation and free tax clinics. Statistics Canada. 2022 Canadian Social Survey results on caregiving and study of unpaid care for children and adults. Service Canada. Canada Pension Plan retirement pension calculation and Employment Insurance caregiving benefits. United Nations. Sustainable Development Goal 5 and target 5.4 on unpaid care.
FEATURE Ottawa’s proposed caregiver tax credit would reach some people who owe no federal income tax. For families giving up paid hours to provide care, the amount and timing of that help matter. Pamela was 49 and five years from retirement eligibility when she left work to care for her father. Her mother and husband later needed care, too. The Nova Scotia woman spent more than a decade out of the workforce, according to her account in a 2026 report by the Canadian Centre for Caregiving Excellence. Leaving work cost her a paycheque right away. The effect on her retirement income took longer to see. “It’s a big surprise when they go to draw CPP—as it was for me,” she told the centre, describing the years she missed contributing to the Canada Pension Plan. Service Canada bases the pension in part on a person’s earnings and contributions over their working life, with provisions that can exclude some low-earning years. The federal budget tabled Nov. 5 proposes making the Canada Caregiver Credit refundable starting with the 2027 tax year. Today, the credit can reduce a federal income tax bill to zero. That can make it worth less to someone whose earnings drop when they take time away from work to provide care. Under the proposal, an eligible caregiver could receive the portion of the credit left over after their tax bill reaches zero. Finance Canada estimates that 585,000 caregivers would benefit, including about 180,000 who get no relief from the existing credit. The department projects $845 million in additional support over four fiscal years starting in 2027–28. What a year can cost Seven per cent of unpaid caregivers for children or adults said they had to reduce their usual weekly work hours in Statistics Canada’s 2022 survey. The survey covered people aged 15 and older living off reserve in the provinces. When care lasts a year, a few missed hours every week can change what a family can afford. Take a hypothetical worker who earns $25 an hour and gives up four paid hours a week to care for a parent. Over 52 weeks, that comes to $5,200 in wages before tax. If the worker qualifies for the proposed maximum of $1,260, the credit would be worth just under a quarter of those gross wages. Their loss in take-home pay would depend on taxes and payroll deductions. In that example, if the worker owed $300 in federal income tax before the caregiver credit, the current design would save them $300. Under the proposal, the other $960 would be paid to the worker. That is the amount of new relief for this household. Paying someone to help with care can add to the strain. In a weighted online survey that Leger conducted for the centre in 2025, about one in five unpaid caregivers surveyed reported spending at least $1,000 a month out of pocket on care. For someone spending $1,000 a month and receiving the full credit, the annual payment would cover a little more than one month of those expenses. Whose care qualifies The Canada Revenue Agency’s guide covers spouses, common-law partners and specified relatives who need support because of a physical or mental impairment. For a dependant, the agency looks for regular help with necessities such as food, shelter or clothing. In Statistics Canada’s survey, 15 per cent of unpaid caregivers for adults with long-term conditions or disabilities reported caring for a friend, colleague or neighbour. Those relationships on their own fall outside the credit’s eligibility rules. The amounts also vary by relationship. For a qualifying adult dependant such as a parent, the 2027 maximum would be $1,260. The amount starts to fall once that parent’s net income exceeds $21,136. The caregiver amount for a qualifying child under 18 at year-end would be capped at $394. Parents can check the agency’s guide for the requirements around a child’s need for substantially more personal care than other children the same age. The agency may ask for a signed statement from a medical practitioner about when the impairment began and how long it is expected to last. The agency can use an approved Disability Tax Credit Certificate already on file for that period. For a household estimating what it might receive, the guide is a place to check which claim applies and which records to keep. The credit is claimed on an income tax return. People with modest incomes and straightforward tax situations can check the agency’s free tax clinic directory for help preparing a return. Help before tax time If Parliament enacts the change as proposed, the first claims would be for 2027, generally filed in 2028. Someone who gives up a shift in January would absorb the lost wages on their next paycheque. Employment Insurance can provide up to 15 weeks of benefits to eligible workers who take time away from work to care for a critically ill or injured adult. Service Canada also accepts claims from people considered like family. For a person with a chronic condition, the critical illness rules require a significant change in their health due to a new, acute life-threatening event. A caregiver supporting someone through a gradual decline can face years of decisions about which shifts they can work. Pamela told the centre that Nova Scotia Health Continuing Care helped pay for part-time care that allowed her family to stay at home. A home support visit that covers the time a caregiver needs to be away can help them keep a shift. Families looking for that kind of help can ask their provincial or territorial home care office when visits could start and how often they could expect them. The same federal budget proposes extending funding agreements with provinces and territories for home and community care, mental health and addictions services through March 2028. Provinces and territories could show families what that support delivers by reporting the time between assessment and a first visit, and how many hours of home support people receive compared with the hours their assessments identify. After the first year of claims, Ottawa can report how many more caregivers receive the credit and how much they receive. That would give families a way to judge whether the new credit reaches the people it was designed for. For someone weighing the choice Pamela faced, the ability to keep a shift also matters beyond the next paycheque. It can help them keep contributing to a pension they will depend on years later. SDG context The United Nations’ gender equality goal calls for recognizing unpaid care through measures including public services and social protection. Among people providing unpaid care to adults in Statistics Canada’s 2022 survey, women reported a median of 10 hours a week and men six. Tracking unpaid care hours and changes in paid work over time would show whether that burden is becoming more evenly shared. Sources referenced Canadian Centre for Caregiving Excellence. Caring in Canada 2026, including Pamela’s account and the 2025 National Caregiving Survey. Finance Canada, Nov. 5, 2026. Budget 2026 affordability chapter and tax measures. Canada Revenue Agency. Canada caregiver credit eligibility and documentation and free tax clinics. Statistics Canada. 2022 Canadian Social Survey results on caregiving and study of unpaid care for children and adults. Service Canada. Canada Pension Plan retirement pension calculation and Employment Insurance caregiving benefits. United Nations. Sustainable Development Goal 5 and target 5.4 on unpaid care.