The BC Climate Action Tax Credit: Everything You Need to Know

Mark Virgil Lofranco • 5 October 2024

Understanding the BC Climate Action Tax Credit: Eligibility, Payments, and Updates


British Columbia was a trailblazer in North America, introducing the first broad-based carbon tax back in 2008. This tax applies to greenhouse gas emissions from burning fuels like gasoline, diesel, and coal. The goal is to encourage citizens to lower their environmental impact.


To help offset the cost of this tax, the BC government offers the BC Climate Action Tax Credit (BCCATC) to low- and middle-income individuals and families. The good news is that as the carbon tax increases, so does the credit, allowing more residents to benefit from the rebate.


Here’s a detailed look at the BC Climate Action Tax Credit, who qualifies, and how to apply.


What is the BC Climate Action Tax Credit (BCCATC)?


The BC Climate Action Tax Credit is a tax-free payment designed to offset the costs of the provincial carbon tax for low- to middle-income individuals and families. This payment is issued quarterly, alongside the GST/HST credit. It is aimed at alleviating the financial burden of rising carbon taxes for BC residents.


Unlike other provinces that receive a federal carbon rebate, BC administers its own carbon tax and rebate program. If you live in BC, you won’t be eligible for the federal rebate, but you will receive the BC Climate Action Tax Credit if you qualify.


What’s New for 2024?


Starting July 1, 2024, BC increased the income thresholds and the amounts eligible for the rebate to help even more people cope with the rising carbon tax.


  • Individual threshold: $41,071 (up from $39,115)
  • Family threshold: $57,288 (up from $50,170)


This means that if your adjusted family net income (AFNI) is below these thresholds, you’ll be eligible for the full rebate. For those with income above these limits, the rebate is gradually reduced by 2% of the amount above the threshold.


How Much is the BC Climate Action Tax Credit?


For the 2024–2025 payment period, the maximum annual amounts have increased:


  • $504 for individuals (up from $447)
  • $252 for your spouse or common-law partner (or the first child in a single-parent family)
  • $126 for each additional child


For example, a family of four can now receive up to $1,008 annually through the tax credit.


Payments are distributed quarterly in July, October, January, and April.


Who is Eligible for the BC Climate Action Tax Credit?


To be eligible for the BC Climate Action Tax Credit, you must:


  • Be a BC resident
  • Be 19 years or older, have a spouse or common-law partner, or be a parent living with your child
  • File a tax return every year


The credit is calculated based on your adjusted family net income (AFNI). If your AFNI exceeds the income threshold, your credit will be reduced by 2% of the excess income. Once your income reaches a certain level, the credit is eliminated.


When are the BC Climate Action Tax Credit Payment Dates?


Payments are made quarterly, typically on the 5th of July, October, January, and April. The payments are issued alongside the GST/HST credit.


Here are the upcoming payment dates:


  • July 5, 2024
  • October 4, 2024
  • January 5, 2025
  • April 5, 2025


How Can I Apply for the BC Climate Action Tax Credit?


Good news—you don’t need to apply separately! When you file your T1 Income Tax and Benefit Return, the CRA automatically assesses your eligibility for the BC Climate Action Tax Credit, along with your GST/HST credit.


To continue receiving the credit, ensure that you file your tax return every year, even if you didn’t earn any income. The credit does not renew automatically if you skip filing.


Make sure your direct deposit information or mailing address is up to date with the CRA to receive your payments promptly.


Do All BC Residents Qualify for the Rebate?


No, not all BC residents qualify for the BC Climate Action Tax Credit. It primarily targets low- to middle-income earners. If your adjusted family net income exceeds the threshold, your credit will be reduced, and those with higher incomes may not receive any rebate at all.

However, the BC government aims to make the credit more widely available, with a goal of covering 80% of BC residents by 2030.


Conclusion


The BC Climate Action Tax Credit is a valuable tool for helping British Columbians cope with the rising costs of the carbon tax. With recent increases in income thresholds and rebate amounts, more families are now eligible to receive this tax-free benefit.


Remember to file your tax return every year to ensure you receive your payment and continue to benefit from this climate action initiative.


Key Takeaways



  • Recent changes have increased the income thresholds for the BC Climate Action Tax Credit, allowing more British Columbians to qualify.
  • Payments are issued quarterly, alongside the GST/HST credit, in July, October, January, and April.
  • To receive the tax credit, you must file a tax return every year—even if you don’t earn any income.

Understanding the USA/Canada Tax Treaty

by Mark Virgil Lofranco • 9 December 2024
Are you a U.S. citizen living and working in Canada? Maybe you're a dual resident unsure of which tax rules to follow, or perhaps you cross the border daily to work for a Canadian company. Understanding the U.S./Canada Tax Treaty is essential for anyone earning cross-border income.  Filing taxes in just one country can be complex, and the U.S. tax system is one of the most complicated in the world. Figuring out taxes for both Canada and the U.S. can be challenging, but don’t worry, we’ve got answers. Here’s how your taxes work under the U.S./Canada tax agreement if you’re living or working in Canada and earning income.

9 Commonly Overlooked Tax Deductions for Startup Owners

by Mark Virgil Lofranco • 9 December 2024
Starting your own business is an exciting and rewarding journey, but with all the enthusiasm, some important financial details—like tax deductions—can be overlooked. As a new business owner, reducing your tax burden is crucial to maximizing profits, yet many Canadian small-business owners miss out on valuable tax deductions, paying up to 42% in taxes.  While you're likely familiar with common deductions like office supplies, meals, and wages, there are many lesser-known tax breaks that could save you money. Let’s dive into nine commonly missed tax deductions that could benefit your startup.

Methods to withdraw RESP

by Mark Virgil Lofranco • 9 December 2024
Navigating the financial landscape of your child’s education expenses, especially with rising inflation, can be challenging. Whether you're already contributing to a Registered Education Savings Plan (RESP) or considering opening one to fund your child’s post-secondary education, it’s essential to understand the rules and benefits associated with RESP withdrawals.  Here’s a comprehensive guide to help you make the most of your RESP in Canada.

Essential Tax Credits and Grants Every Small-Business Owner Should Be Aware Of

by Mark Virgil Lofranco • 9 December 2024
Did you know that public funding could help kickstart your business? While many entrepreneurs are familiar with startup loans, fewer know about the wealth of public funding options available—specifically, tax credits and grants. These financial resources can be game changers for launching and growing your business.  This article will guide you through various tax credits, grants, and other public funding options that can support your small business.

How to Handle Toronto's Inherent Property Tax Increase: Tax Advice for First-Time Buyers

by Mark Virgil Lofranco • 9 December 2024
Buying your first home in Canada is an exciting milestone. However, potential and current homeowners in Toronto should be aware of a major change on the horizon: a proposed 10.5% increase in residential property taxes, the largest since 1998. This hike, driven by a nearly $1.8B budget shortfall, includes a 1.5% increase dedicated to city-building projects, such as transit and housing. Homeowners could face an extra $26.75 per month, or $321 annually, in property taxes. City officials have also warned that without federal funding, property taxes could rise even further, up to 16.5%.

A CRA Business Number (BN): What Is It and Who Needs One?

by Mark Virgil Lofranco • 9 December 2024
Congratulations! Whether you’ve just become self-employed or started a side gig to earn extra income, you're on an exciting journey. Amid all the hustle, you might have come across something called a Business Number (BN). But what exactly is it, and do you need one? Let’s dive in and explore everything you need to know about registering for a BN as a self-employed person or small business owner.

2023 Canada Tax Checklist: Essential Documents You Need to File Your Taxes

by Mark Virgil Lofranco • 9 December 2024
Picture this: tax season is approaching, and you’re frantically trying to gather the documents you need, worried you might miss something important. Sound familiar? That’s why having a tax checklist is essential. It helps you stay organized and ensures you have everything you need to file smoothly.  In this article, we’ll cover all the documents you need to have handy when filing your taxes!

2024 Tax Deadline: When Is the Last Day to File Your Taxes?

by Mark Virgil Lofranco • 9 December 2024
As a taxpayer, one of the most critical aspects to stay on top of is the deadline for filing your taxes. The Canada Revenue Agency (CRA) enforces strict due dates for both returns and payments. Filing on time not only helps you avoid interest and penalties but also ensures you get your refund faster. We’ve compiled all the key tax dates you need to know for a stress-free tax season.

NETFILE Opening in Canada: When You Can Start Filing Your Taxes

by Mark Virgil Lofranco • 9 December 2024
The way we file taxes has evolved dramatically over the past two decades, making it faster and more efficient to submit your returns. With tools like NETFILE, the Canada Revenue Agency (CRA) offers taxpayers a quick and secure method to file returns online. This article explains when to file your taxes, key deadlines, how NETFILE works, and why it’s a great option for fast-tracking your tax return.

Missed the Tax Deadline? Here’s Why It’s Not Too Late to File

by Mark Virgil Lofranco • 9 December 2024
If you missed the tax filing deadline and are feeling anxious, take a deep breath—it’s more common than you think, and it’s not too late to take action!  You can still file your tax return even after the deadline, and this article will walk you through the process to help you file confidently and minimize any potential penalties.
More posts