The Climate Action Incentive Payment (CAIP) is a tax-free payment to residents of Alberta, Saskatchewan, Manitoba, and Ontario to offset the cost of federal carbon pollution pricing system. You must be at least 19 years of age, a parent or have/had a spouse to receive this payment.
Since July 2022, the previous refundable tax credit will be retired and will be replaced by tax-free quarterly payments which will entitle those eligible to automatically receive the CAIP on the 15 of April, July, October, and January. Starting July 1, 2023, the benefit will be expanded to Newfoundland and Labrador, Nova Scotia, and Prince Edward Island. Residents of these provinces will receive three quarterly payments (July 2023, October 2023, and January 2024) in the first year and four payments in the year(s) after that.
Eligibility will be determined by the CRA when they review your income tax and benefit return. Payments will automatically be transferred to eligible residents - no application necessary. The CAIP can only be claimed by one person in a family. The amount received will vary for each family situation and province. The CAIP includes a supplement for residents of small and rural communities. To claim this supplement, you must complete Schedule 14 and attach it to your income tax and benefit return. As these are tax-free payments, there will be no impact on your taxable income or tax liability. Any overpayments or underpayments will not be subject to interest by the CRA.
- Zijie, Young Tax Professional