July 1 of each year marks the beginning of a new provincial tax credit benefit year in Ontario. To be eligible to receive these benefits, it is important that you have filed your previous year’s tax return. This is because benefits are based, in part, on your previous years income.
Most of these benefits are filed on a monthly basis. If you have failed to file your tax return, you will not receive the monthly instalments of any benefits you are otherwise eligible for, however, they will be reinstated once you file your return and it has been assessed.
One of the most common tax credit benefits is the Ontario Trillium Benefit.
The Ontario Trillium Benefit (OTB) is a tax-free benefit paid to low or moderate income families and individuals in Ontario to help pay for energy costs, sales tax and property tax. The OTB is made up of three credits - the Northern Ontario Energy Credit, the Ontario Property Tax and Energy Credit and the GST/HST Sales Tax Credit.
You are not required to be eligible for all three to receive the benefit.
1. Northern Ontario Energy Credit
The Northern Ontario Energy Credit is a tax-free benefit paid to Northern Ontario residence to help offset the higher energy costs.
Eligibility Requirements:
To receive this portion of the OTB, you must:
- Have a main residence in Algoma, Cochrane, Kenora, Manitoulin, Nipissing, Parry Sound, Rainy River, Sudbury, Thunder Bay, or Timiskaming.
- Be 18 years or older, have had a spouse or common-law partner, or be a parent who lives with or previously lived with your child.
- Paid property tax for your main residence, rented, lived on a residence and paid for home energy costs, or lived in and paid for a portion of public long-term care home accommodations in the previous year.
Your eligibility may change from month to month depending on where you live in the current year on the first of the month. For example, if you moved from Algoma to Barrie on November 1 - you will no longer receive your monthly payment for this portion of the OTB, going forward.
2. Ontario Energy and Property Tax Credit
Unlike the Northern Ontario Energy Credit, the Ontario Energy Credit is available to anybody who lives in Ontario, including those who are already eligible for and receive the Northern Ontario Energy Credit, and provides relief to taxpayers for property taxes and the sales taxes paid on energy.
Eligibility Requirements:
To receive this portion of the OTB, you must:
- Be 18 years or older, have had a spouse or common-law partner, or be a parent who lives with or previously lived with your child.
- Paid property tax for your main residence, rented, lived on a residence and paid for home energy costs, or lived in and paid for a portion of public long-term care home accommodations in the previous year.
Similar to the Northern Energy Credit, eligibility is based on where you live on the first of each month. If you move out of province you will no longer receive your monthly payment.
3. Ontario Sales Tax Credit
The third and final portion of the OTB was implemented to help offset the costs of sales tax paid.
Eligibility Requirements:
To receive this portion of the OTB, you must be 19 years or older, have had a spouse or common-law partner, or be a parent who lives with or previously lived with your child.
For help determining whether you are eligible for the Ontario Trillium Benefit or if you need help filing your taxes so that you can receive your payments, contact us today.
