The Canadian government has announced two major initiatives to provide financial relief to citizens, including international students and permanent residents. One of these initiatives is the new $250 Working Canadians Rebate, expected to benefit 18.7 million Canadians in early spring 2025. The other involves a temporary GST/HST-free shopping period, set to support individuals during the holiday season.
Purpose of the $250 Working Canadians Rebate
The Working Canadians Rebate is part of Canada’s ongoing effort to assist workers in navigating the challenges posed by inflation and the rising cost of living. The government aims to provide one-time, tax-exempt payments to workers who contributed to the labor force in 2023. The $250 rebate will be automatically distributed to eligible Canadians in early spring 2025 by the Canada Revenue Agency (CRA).
The rebate is available to individuals who earned a net income of up to $150,000 in 2023. The initiative is designed to offer direct financial assistance to working Canadians, helping to ease financial pressures as the economy continues to recover.
GST-Free Shopping for Holiday Essentials
As part of the government’s broader relief efforts, a two-month GST/HST exemption will apply to select holiday items, including groceries, children’s clothing, meals, and gifts. This exemption will be in place from December 14, 2024, to February 15, 2025. During this period, Canadian families can save on essential purchases. For example, a family spending $2,000 on eligible items can save $100 in GST. The expected federal tax relief for this measure is estimated at $1.6 billion.
Eligibility for the $250 Rebate
To qualify for the $250 Working Canadians Rebate, individuals must meet certain criteria:
- Income: Must have earned a net income of $150,000 or less in 2023.
- Tax Filing: Must have filed a 2023 tax return by December 31, 2024, and claimed contributions to the Canada Pension Plan (CPP) or Quebec Pension Plan (QPP), and premiums for Employment Insurance (EI) or Quebec Parental Insurance Plan (QPIP).
- Residency: Must be a Canadian resident as of March 31, 2025.
- Other: Individuals in prison for the 90 days leading up to April 1, 2025, will not qualify.
The rebate is aimed at supporting full-time, part-time, self-employed, and unemployed individuals who meet these requirements. The Canada Revenue Agency (CRA) will handle the disbursement, ensuring that eligible recipients automatically receive the rebate either by direct deposit or cheque.
Distribution of the $250 Rebate
Eligible Canadians do not need to apply for the $250 rebate. The CRA will automatically distribute the funds through direct deposit (for those who have provided banking details) or by cheque. It is important to ensure that your banking information and mailing address are up to date to avoid any delays in receiving the payment. The expected distribution period for the rebate is early spring 2025.
Preparing for the Rebate
To ensure timely receipt of the $250 Working Canadians Rebate, follow these preparatory steps:
- File your 2023 tax return by December 31, 2024.
- Review your tax credits for CPP, QPP, EI, and QPIP to ensure they are accurately reflected.
- Update your banking information with the CRA to ensure direct deposit payments.
- Verify your mailing address with the CRA if expecting a cheque.
