Posted by With rising housing costs across Canada, many families are turning to multigenerational living solutions—bringing seniors, adults, and children under one roof. To support this, the Canada Revenue Agency (CRA) is offering the $7,500 Multigenerational Home Renovation Tax Credit (MHRTC) in 2025.
This one-time tax benefit helps families who renovate or create a secondary unit within their home for a qualifying individual.
This article explains who qualifies, how to claim the credit, what expenses are eligible, and when Canadians can expect to receive the benefit.
MHRTC $7,500 Tax Credit in Canada
| Program Name | Multigenerational Home Renovation Tax Credit (MHRTC) |
|---|---|
| Year | 2025 |
| Credit Amount | Up to $7,500 (15% of $50,000 in qualifying expenses) |
| Purpose | Encourage secondary dwelling creation for multigenerational living |
| Issuing Agency | Canada Revenue Agency (CRA) |
| Payment Type | One-time refundable tax credit |
| How to Claim | File tax return, use Schedule 12, claim on Line 45355 |
| Official Website | www.canada.ca |
Eligibility Criteria for the $7,500 MHRTC in 2025
To be eligible for the MHRTC benefit, the renovation or construction must meet several qualifying criteria:
- Qualifying Individual: Must be either:
- A senior aged 65 years or older, or
- An adult aged 18 to 64 who qualifies for the Disability Tax Credit (DTC).
- Eligible Individual: The person claiming the tax credit must:
- Be a Canadian resident for the full year (January 1 – December 31, 2025).
- Own the home where the renovation is taking place.
- Incur the renovation expenses personally.
- Renovation Requirements:
- A secondary unit must be built or modified within an existing dwelling.
- Must include a private entrance, bathroom, kitchen or kitchenette, and sleeping area.
- Must be completed in the tax year for which the claim is made.
How to Claim the MHRTC on Your 2025 Tax Return
To receive the $7,500 MHRTC, eligible Canadians must:
- Complete the Renovation: Ensure the renovation is fully done in 2025.
- Track All Expenses: Keep invoices, receipts, and documentation for materials and services.
- Fill Out Schedule 12: Use CRA’s Schedule 12 to report qualifying expenses.
- Claim on Line 45355 of your T1 tax return.
What Are MHRTC Qualifying Expenses?
Expenses must be directly linked to creating or modifying a secondary dwelling unit. The following count as qualifying expenditures:
- Materials and fixtures (flooring, insulation, lighting, etc.)
- Building plans and permits
- Professional services (electricians, plumbers, architects, carpenters)
- Rental equipment used in renovation
- Labour and construction costs
- Appliances and built-in features required for secondary living.
The $7,500 Multigenerational Home Renovation Tax Credit 2025 is a valuable opportunity for Canadians creating secondary dwellings to support seniors or persons with disabilities.
By reducing renovation costs through a refundable tax credit, this initiative helps families live together while easing pressure on the national housing market.
Make sure you track all expenses, file using the correct forms, and consult CRA guidelines to ensure your claim is accurate and timely. With proper planning, this credit could offer significant savings for your family’s multigenerational future.
FAQs
When will the $7,500 MHRTC payment be received?
The MHRTC is a tax credit, not a direct cash payment. It will be applied to your 2025 tax return, filed in early 2026. If eligible, you may receive the amount as a refund.
Can I claim the MHRTC if the secondary unit is not fully complete?
No. The renovation must be fully completed in the same tax year you claim the credit.
What if I already claimed MHRTC once before?
The credit is limited to one lifetime claim per qualifying individual. You cannot claim it again for the same person.