With prices surging on everything from gas to groceries, many Canadian households feel financially squeezed. But some residents are getting a bit of relief through quarterly Canada Carbon Rebate payments.
Introduced in 2019, the Canada Carbon Rebate is a government benefit program which provides tax-free payments to eligible provinces to help offset the cost of the federal carbon tax, putting that money directly back into Canadians’ pockets.
As costs rise across the board, this new rebate is welcomed aid for strained budgets. But how does the program work and who qualifies for the payments? Let’s find out below.
What is the Canada Carbon Rebate?
The Canada Carbon Rebate (CCR) is a quarterly payment made by the Canadian government to residents of provinces that have adopted the federal carbon pricing system. Previously known as the Climate Action Incentive payment, the CCR was introduced in 2019 to help offset the cost of the federal carbon tax for individuals and families.
The CCR is a key component of Canada’s approach to pricing carbon pollution. In 2019, the federal government implemented a minimum national carbon tax, starting at $20 per tonne and increasing annually. This carbon tax is applied through fuel charges and output-based pricing systems. The revenue generated then goes back to the provinces and residents through initiatives like the CCR.
How the CCR Works
The federal fuel charge means drivers and households pay more for gasoline, natural gas, propane, and other fuels. The government then returns the majority of this revenue to taxpayers via the quarterly CCR payments.
The purpose of the CCR is to help minimize the financial impact of the fuel charge on individuals and families. The payments also incentivize people to use less carbon-intensive fuels and make eco-friendly choices.
Provinces Receiving the CCR
As of 2025, the CCR is distributed to residents of the following provinces that use the federal carbon pricing system:
- Alberta
- Saskatchewan
- Manitoba
- Ontario
- New Brunswick
- Nova Scotia
- Prince Edward Island
- Newfoundland and Labrador
These provinces use the federal carbon pollution pricing system. Other provinces may have their own provincial carbon tax models and rebate systems in place.
Who is Eligible for the Canada Carbon Rebate?
There are a few key requirements to receive the quarterly CCR payments:
Residency: You must be a resident of Canada for income tax purposes and live in one of the provinces where the federal fuel charge applies.
Age: To qualify, you must be 19 years or older. If under 19, you need to have (or previously had) a spouse or common-law partner or be a parent who lives with their child.
Tax filing: You have to file a tax return every year, even if you have no income to report. The CCR payments are based on the previous year’s tax return.
CRA account: You need to register an account with the Canada Revenue Agency (CRA). Newcomers to Canada must apply specifically for the CCR.
Payment method: The CRA determines your payment method (direct deposit or cheque) based on how you receive your tax refunds.
So, in summary, the basic requirements are:
- Live in an eligible province
- Be 19 or meet exceptions
- File taxes annually
- Have a CRA account
- Use direct deposit or cheque
How Much is the Canada Carbon Rebate?
The amount of the CCR varies depending on which province you live in, your family size, and whether you qualify for the rural supplement.
CCR Payment Amounts by Province
Below are the quarterly base amounts by province for 2025, as published by the Department of Finance Canada:
| Province | 1st Adult | 2nd Adult | Per Child <19 | Family of 4 |
| Alberta | $225 | $112.50 | $56.25 | $450 |
| Saskatchewan | $188 | $94 | $47 | $376 |
| Manitoba | $150 | $75 | $37.50 | $300 |
| Ontario | $140 | $70 | $35 | $280 |
| New Brunswick | $95 | $47.50 | $23.75 | $190 |
| Nova Scotia | $103 | $51.50 | $25.75 | $206 |
| PEI | $110 | $55 | $27.50 | $220 |
| Newfoundland | $149 | $74.50 | $37.25 | $298 |
As shown in the table, amounts vary significantly by province. This is because provinces with higher carbon pricing costs per household (such as Alberta and Saskatchewan) receive larger rebates.
The CCR amounts are calculated based on the expected proceeds from the federal fuel charge in each participating province.
Rural Supplement
Residents of rural regions receive an extra supplement equal to 20% of the base amount. For example, a rural resident in Ontario would get an extra $28 per quarter on top of the $140 base amount.
Eligibility for the rural supplement depends on where you lived on the first day of the month prior to the payment month.
Examples of CCR Amounts
Here are some examples of total CCR amounts paid quarterly to different household types and compositions:
- Single adult in Alberta = $225
- Single parent in Saskatchewan with 2 children = $282 ($188 base + 2 x $47 children’s amounts)
- Rural couple in Manitoba = $270 ($180 base + $90 rural supplement)
- Family of 4 (2 adults, 2 kids) in New Brunswick = $190 ($95 + $47.50 + 2 x $23.75 children’s amounts)
The CCR amounts are tax-free and also increase with inflation each year.
When Are CCR Payments Made?
The Canada Carbon Rebate is paid out quarterly through direct deposit or cheque on the following dates:
- January 15
- April 15
- July 15
- October 15
If the payment date falls on a weekend or public holiday, it will be issued on the next business day.
This CCR payment schedule aligns with the CRA’s issuance of the GST/HST credit. Most recipients who already receive tax refunds and benefits via direct deposit will receive their CCR on the same quarterly schedule.
Read more: Statutory Holidays in Canada
How Do You Get the Canada Carbon Rebate?
For most Canadians, receiving the CCR happens automatically based on filing an income tax return.
- Existing CRA account: If you have an account with the CRA and file taxes every year, you will get the CCR payment without any additional application.
- New CRA account: People new to Canada who create a CRA account and file taxes will need to submit an additional CCR application form.
- Payment method: If you receive tax refunds by direct deposit, the CCR will be deposited directly into the same account. If you get refunds by cheque, the CCR will also be mailed to you.
- Shared custody: In cases of shared custody, the parent who claims the child first for the Canada Child Benefit will receive the CCR for that child.
- Changing accounts: Inform the CRA immediately if your banking information or address changes so payments go to the right account on time.
What If You Don’t Get the Canada Carbon Rebate?
If you believe you qualify for the CCR but have not received it, here are some things to double-check with the CRA:
- Verify your tax return for the previous year has been filed and assessed. The CCR eligibility is based on your prior year’s return.
- Confirm the CRA has your current banking details and residential address, especially if you recently moved.
- Check if you have outstanding government debts that the CCR may have been applied to first before being issued to you.
- Ensure you meet the residency and age requirements for the period of the missing payment.
- Contact CRA to confirm your payment was issued – cheques can sometimes get lost in the mail.
If the issue persists after you contact the CRA, you may need to make an adjustment on your next tax return to claim and receive the missing payment amounts.
Is the Canada Carbon Rebate Taxable?
No, the CCR payments received by individuals and families are completely tax-free. The funds do not need to be reported as income on your tax return. This differs from some other federal benefit programs that are considered taxable income.
The CCR’s tax-free status benefits recipients. The full amount of the payment goes directly to them rather than being reduced through taxation.
Canada Carbon Rebate for Small Businesses
The Canadian government has introduced a carbon rebate program specifically targeted at small and medium-sized businesses to provide financial relief from carbon pricing policies.
This rebate aims to return a portion of the carbon tax revenues collected from small businesses back to them.
Which Businesses Are Eligible?
To qualify for the small business carbon rebate, companies must meet the following criteria, according to the government’s guidelines:
- Business structure: Must be a Canadian-controlled private corporation (CCPC). Other structures like sole proprietorships, partnerships, and non-profits do not qualify.
- Business size: Must have fewer than 500 full-time employees, based on T4 slips issued over the preceding 5 years.
- Location: Must operate and employ people in a province under the federal backstop carbon pricing system. This includes Alberta, Saskatchewan, Manitoba, Ontario and four Atlantic provinces (NS/NB/PE/NL).
- Tax filing deadline: The prior year’s corporate tax return must be filed by the due date, typically July 15.
How Is the Rebate Amount Calculated?
The rebate amount provided to each eligible small business is calculated based on two factors:
- Number of employees
- Province of operation
Businesses receive a pre-set rebate amount per employee depending on which province they are located in, as carbon tax rates vary by province.
The table below outlines the rebate amounts per employee for each eligible province and year based on provincial carbon tax levels:
| Province | 2019 Rate | 2020 Rate | 2021 Rate | 2022 Rate | 2023 Rate |
| Alberta | Not Applicable | $147 | $123 | $140 | $181 |
| Saskatchewan | $110 | $271 | $244 | $298 | $233 |
| Manitoba | $48 | $99 | $77 | $89 | $168 |
| Ontario | $26 | $68 | $75 | $86 | $146 |
| New Brunswick | Not Applicable | Not Applicable | Not Applicable | Not Applicable | $87 |
| Nova Scotia | Not Applicable | Not Applicable | Not Applicable | Not Applicable | $119 |
| Prince Edward Island | Not Applicable | Not Applicable | Not Applicable | Not Applicable | $82 |
| Newfoundland and Labrador | Not Applicable | Not Applicable | Not Applicable | Not Applicable | $179 |
As shown, rates vary across provinces and years, ranging from $26 to $298 per employee. The rebate is retroactive, covering carbon taxes paid from 2019 to 2022.
When Will Businesses Receive the Rebate?
The carbon tax rebate for small businesses is typically issued via direct deposit each fall after the tax year has ended. The rebate payments cover the carbon taxes paid by businesses for the previous calendar year.
For example, the rebate deposited in Fall 2022 will be for carbon taxes paid in 2021. Any businesses that miss the tax filing deadline, usually June 30, will receive their rebate deposits later in the winter rather than the fall.
The rebate direct deposits are labelled “Climate Action Incentive” for identification purposes.
The bottom line
Canada’s carbon rebates are meant to take some of the sting out of carbon pricing for you and small businesses. As a household, you get rebates to cover those rising energy costs hitting your budget. Small businesses also receive rebates to offset the carbon taxes they pay.
Looking ahead, the rebates showcase the tricky balancing act of carbon pricing—cutting carbon without cutting too deeply into your wallet.
FAQs related to the Canada Carbon Rebate
How do I apply for the Canada Carbon Rebate?
Most eligible individuals do not need to apply for the Canada Carbon Rebate. Payments are issued automatically to residents in participating provinces based on their annual tax returns. If you have not filed taxes, you may need to complete an application to receive the rebate.
Why was the Canada Carbon Rebate introduced?
The rebate was introduced to offset the increased costs of the federal carbon tax on households. It puts carbon tax money back into people's pockets to help manage rising expenses.
When are the Canada Carbon Rebate payments issued?
Rebates are paid quarterly, usually in January, April, July and October. Payments follow annual tax assessments so may be delayed if you file taxes late.
Do I need to re-apply for each Canada Carbon Rebate payment?
No, you do not need to reapply once eligible. Payments are automatically issued to those who qualify based on their latest tax filing. Notify the CRA if your circumstances or residence change.
How much will I receive from the Canada Carbon Rebate program?
Rebate amounts vary by province, household size and residency status. For example, the average Ontario household received $300 in 2022. Visit your provincial website for precise amounts.
Is the Canada Carbon Rebate payment considered taxable income?
No, the Canada Carbon Rebate is not considered taxable income so you do not pay any tax on the amount received.