Millions of Canadians are set to receive the first carbon rebates of the year from the federal government this week. Payments will be issued on Wednesday to residents in eight provinces: Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, and Saskatchewan.
The tax-free rebates are part of the federal government’s effort to return 90 percent of the revenue generated from the carbon pricing applied to households in these provinces. The Canada Revenue Agency (CRA) explains that the rebates are intended to help eligible individuals and families offset the costs of federal pollution pricing.
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It’s important to note that British Columbia, Quebec, and the Northwest Territories have their own carbon pricing systems, so residents in these areas do not receive the federal rebate. Yukon and Nunavut use the federal system but handle the distribution of proceeds themselves.
How Much Can Canadians Expect to Receive?
Carbon rebates are distributed in four installments annually. The amount received will vary based on the size of the household and the province of residence.
Residents in rural areas also receive an additional supplement, which increased from 10 percent to 20 percent of the basic rebate amount last year.
Provinces with a higher reliance on fossil fuels for electricity generation offer larger rebates, as their residents tend to pay more in carbon pricing.
Here’s a breakdown of the expected rebate amounts for January 2025:
- Alberta: Individuals can expect $225. Couples or common-law partners with one child (or as a single parent) will receive an additional $112.50, with each child under 19 years adding $56.25 to the rebate.
- Manitoba: The payment starts at $150 for individuals, with the amount rising to $225 for single parents or married/common-law couples. A family of four could receive $300.
- New Brunswick: Individuals will get $95, while couples can expect $142.50. Each child adds $23.74 to the rebate.
- Newfoundland and Labrador: Individuals will receive $149, with couples receiving $223.50. Payments increase by $37.25 for each child.
- Nova Scotia: The expected amount is $103 for individuals, increasing to $154.50 for married or common-law couples or single parents. Each child adds $25.75 to the rebate.
- Ontario: Single individuals will receive $140. Married couples or common-law partners will get $210, with an additional $35 per child under 19 years. A family of four could receive $280.
- Prince Edward Island: Individuals will receive $110, while couples or common-law partners will get $165. A family of four can expect $220, with all P.E.I. residents eligible for a 20 percent rural top-up.
- Saskatchewan: The expected rebate for individuals is $188, with $94 for the first child of a single parent or couple. An additional $47 will be added for each child under 19 years.
Eligibility Requirements for the Carbon Rebate
To be eligible for the carbon rebate this month, individuals must have been a resident of Canada in December and lived in one of the eight eligible provinces as of January 1, 2025. Applicants must also be at least 19 years old, or under 19 but have a spouse, common-law partner, or be a parent living with their child.
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Payments will be distributed via either mailed cheques or direct bank deposits.
The Bigger Picture: Do Canadians Benefit from the Carbon Rebate?
A report by the Parliamentary Budget Officer (PBO) in October 2024 revealed that most households receive more in carbon rebates than they pay in carbon pricing. However, these gains are often offset by other broader economic factors, leaving many Canadians with little net benefit after taking into account other financial pressures.
The next round of carbon rebate payments will be issued on April 15, 2025.
This initiative is part of Canada’s broader strategy to tackle climate change while providing financial relief to households impacted by the cost of pollution pricing.
