9.3.6 Non-refundable and refundable tax credits 

Non-refundable tax credits

All taxpayers can claim a basic non-refundable tax credit for their income tax, known as the personal amount. It is adjusted annually to allow for inflation and other factors. In 2023, the personal amount for federal taxes was $15,000 and the personal amount for Quebec taxes was $17,183.

The amounts allowed, for example the basic personal amount, transform into tax credits at the rate of 15% for the federal authorities and 14 % for Quebec. These tax credits help reduce the taxes payable.

Example: Martin had a taxable income of $39,000 in 2023. The Quebec income tax he would pay on that income is $5,460. The Quebec personal amount is $17,183, that becomes a tax credit of 14 percent, or $2,405.62. This tax credit reduces his Quebec income tax to $3,054.38.

Similar calculations are used to calculate Martin's other non-refundable tax credits. Because these credits are non-refundable, he won't receive a tax refund if they total an amount larger than the taxes he owes.

In addition, people in certain categories are entitled to additional personal exemptions. For example, on your 2023 income tax returns:

• If you are over the age of 65, you can claim up to $8,396 on the T1 return and up to $3,614 on the Quebec TP-1.D-V return.
• If you have children, you can claim $2,499 for each child under the age of 18 on the T1 return.
• If you receive a pension, you can claim up to $2,000 on the T1 return and up to $3,211 on the TP-1.D-V return.
• If you have a disability, you can claim up to $9,428 on the T1 return and up to $3,815 on the TP-1.D-V return.
• If you earned income from a job, you can claim up to $1,368 on the federal T1. (A similar amount could be deducted from income on the TP-1.D-V return.)
• If you paid union or professional dues, you can claim them on the TP-1.D-V return. (They are treated as a deduction from income on the T1 return.)
• If you care for a dependent who is infirm, you can claim up to $7,999 on the T1 return. There is no similar credit on the TP-1.D-V return.

Some of these exemptions can be transferred to another taxpayer. For example, a dependent student can transfer the education amount to a parent, who can use it to reduce his or her own income.

Step 5 - Part B of the T1 tax return lists the non-refundable federal income tax credits (see illustration). Review the non-refundable tax credits listed in the illustration and make note of any that you think apply to you.

Page 3 of the Quebec TP-1.D-V return and Schedules A to V list the non-refundable Quebec income tax credits (see illustration). Review the non-refundable tax credits listed in the illustration and make note of any that you think apply to you.

Non-refundable tax credits are available only when you meet specific conditions, so check the tax guide to be sure that they apply.

• For more information, go to Canada Revenue Agency's General income tax and benefit package or get a copy of the guide at your local post office.
• For more information, go to Revenu Québec's Completing Your Income Tax Return or get a copy of the Quebec guide at your office of Revenu Québec or at most Desjardins caisses.

Refundable tax credits

Refundable tax credits are credits that will be paid to you if you are eligible. Often the federal or provincial government pays them to you in a series of payments through the year to assist with living expenses.

Federal refundable tax credits include:

• the goods and services tax/harmonized sales tax (GST/HST) credit
• the Working Income Tax Credit.

Quebec refundable tax credits include:

• the Solidarity Tax Credit (combining tax credits for the Quebec sales tax, the property tax refund and the credit for individuals living in northern villages)
• the Work Premium, Supplement to the Work Premium and Adapted Work Premium
• tax credits for adoption, caregiver and childcare expenses for children under 16 years of age
• a tax credit for home support of seniors aged 70 or over
• a tax credit for certain medical expenses.