Creating a safer, more comfortable space for your aging parents or a disabled family member? The $7,500 Home Renovation Tax Credit for 2025 could help you cover the cost of building a self-contained secondary unit.
This Canadian government initiative supports families by easing the financial burden of renovations, especially when they’re intended to improve accessibility and independent living.
The best part? It’s a refundable tax credit. So, even if you don’t owe taxes, you can still receive a payment of up to $7,500. But to claim it, you’ll need to meet specific eligibility requirements and provide detailed proof of your expenses. Let’s break it all down.
Table of Contents
Purpose
This tax credit, officially known as the Multigenerational Home Renovation Tax Credit (MHRTC), is part of Canada’s bigger plan to make housing more accessible and affordable. It promotes multigenerational living by helping families create additional living spaces for seniors and adults with disabilities.
Not only does this help families stay close and reduce care costs, but it also strengthens emotional and financial support systems within the household. Think of it as a practical way to bring generations together under one roof while still giving everyone their own space.
Amount
So how much can you actually get? The MHRTC allows you to claim 15% of your eligible renovation expenses, up to a maximum of $50,000. That means the highest possible credit is $7,500.
This is a refundable credit—meaning, even if you owe nothing in taxes, the CRA will still pay you the amount you’re entitled to. That’s money back in your pocket for making your home more livable and accessible for someone you care about.
Eligibility
To qualify for the $7,500 Home Renovation Tax Credit in 2025, you need to check a few boxes. Here’s what matters:
Who qualifies?
- A senior aged 65 or older by the end of the tax year.
- An adult eligible for the Disability Tax Credit (DTC).
Who can claim?
- Either the qualifying individual or a related family member who owns the home can claim the credit.
Property requirements:
- The home must be in Canada.
- It must be owned by the applicant or the eligible person.
- It should be, or is expected to be, lived in by the eligible person within 12 months of renovation.
Renovation requirements:
- You must build a self-contained secondary unit.
- It should include a private entrance, bedroom, kitchen, and bathroom.
- Must comply with local zoning and building regulations.
Process
Ready to claim the credit? Here’s a step-by-step guide:
- Plan the renovation
Make sure your plans comply with local building codes. Hiring licensed contractors can help prevent costly mistakes. - Track your expenses
Keep a digital log of all expenses—receipts, contractor invoices, and equipment rental payments. This documentation is essential. - Complete your renovation
Only renovations completed in the 2025 tax year are eligible. The unit should be fully built and meet safety standards. - Fill out Schedule 12
Use this CRA form to calculate your eligible expenses. Be accurate with your numbers—it affects the amount you can claim. - Report on your tax return
Enter the amount from Schedule 12 on line 45355 of your return. - Submit your documents
Include Schedule 12 with your return. Keep all receipts and proof of payment in case the CRA asks. - Check your status
Log into your CRA account after filing to track your claim. If CRA needs more information, respond quickly.
Coverage
What exactly can you claim under this tax credit? Here’s a breakdown of eligible and non-eligible expenses:
| Eligible Expenses | Not Eligible |
|---|---|
| Construction materials | Regular repairs/maintenance |
| Contractor or architect fees | Home appliances (e.g., fridges) |
| Equipment/tool rentals | Furniture or decor |
Only costs directly related to making the secondary suite functional and accessible count. Things like a separate entry, bathroom, and kitchen are must-haves to qualify.
Facts
You may have seen online chatter about this credit—is it legit? Yes, it’s real. But there are strings attached.
- It only applies to renovations that create a separate unit for a qualifying senior or adult with a disability.
- The home must be owned by the applicant or qualifying person.
- The new unit must have its own sleeping, cooking, and bathroom facilities.
Timing
Although the government hasn’t locked down the exact claiming window, the 2025 tax year typically ends with the April 2026 tax deadline. Make sure all your renos are completed before December 31, 2025, to qualify. Watch the CRA website for updates.
With proper planning, you can use this tax credit to offset renovation costs significantly. If you’re already considering upgrading your home to accommodate a loved one, this incentive makes the idea even more appealing. Just stay organized, keep all your receipts, and follow the rules to the letter.
FAQs
Who qualifies for the tax credit?
Seniors 65+ or adults eligible for the Disability Tax Credit.
How much can I claim in 2025?
You can claim up to $7,500 through the MHRTC.
Is this credit refundable?
Yes, it’s refundable—even if you owe no taxes.
What renovations qualify?
Only self-contained secondary units for eligible relatives.
Where do I claim the credit?
Enter it on line 45355 of your 2025 tax return.
