$7,500 Home Renovation Tax Credit 2025: Claim Process, Eligibility, and Benefits

The Government of Canada has introduced various programs to help families adapt their homes to meet changing needs, particularly for seniors and people with disabilities. One of the most significant initiatives is the $7,500 Home Renovation Tax Credit 2025 (MHRTC). This refundable tax credit is aimed at families who wish to build or renovate secondary housing units to accommodate aging parents or disabled relatives, thereby encouraging multigenerational living and fostering independence.

Even if you do not owe any taxes, you may still be eligible to receive up to $7,500 as a refundable tax credit for qualifying renovations. This guide explains the eligibility, claim process, qualified expenses, and important details to help you take full advantage of this program.

What is the $7,500 Home Renovation Tax Credit 2025?

The MHRTC is part of Canada’s broader strategy to:

Also Read

CPP & OAS Changes in September 2025: New Rates, Eligibility, and Payment Updates

• Improve housing affordability.
• Strengthen family care networks.
• Provide financial support for elderly and disabled individuals.

By offsetting part of the renovation costs, the tax credit encourages families to create safe and accessible secondary suites for seniors or adults with disabilities.

For example, if you renovate your home to add a self-contained apartment for your elderly parent, you may be entitled to claim up to $7,500 back on your tax return.

Quick Summary: $7,500 Home Renovation Tax Credit 2025

Who is Eligible for the $7,500 Home Renovation Credit in 2025?

To qualify, you must meet three key criteria:

1. Qualifying Person

• Must be 65 years of age or older at the end of the tax year, or
• Must be eligible for the Disability Tax Credit (DTC).

2. Eligible Residence

• The property must be located in Canada.
• Must be owned by the applicant or a family member.
• The residence must be regularly occupied by the qualifying individual or expected to be occupied within one year of renovation.

3. Renovation Requirement

• Renovations must create a secondary, self-contained unit.
• The unit must include:
  • Separate bedroom,
  • Kitchen,
  • Bathroom, and
  • Private entryway.
• Must comply with all local building codes and regulations.

Step-by-Step Process to Claim the $7,500 Home Renovation Tax Credit

Step 1: Plan Your Renovation

• Ensure your design complies with local building codes.
• Hire licensed contractors for major works to avoid disqualification.

Step 2: Track Your Expenses

• Keep detailed invoices, receipts, and proof of payment.
• Maintain a renovation log for transparency.

Step 3: Complete Renovations

• Work must be completed within the tax year you intend to claim.
• Verify that the new suite meets the safety and eligibility requirements.

Step 4: Fill Out Schedule 12

• Use the CRA Schedule 12 form to calculate eligible expenses and the tax credit amount.

Step 5: Include on Your Tax Return

• Enter the calculated amount on line 45355 of your return.
• Attach receipts and documentation in case CRA requests verification.

Step 6: File Your Tax Return

• Submit your completed return along with Schedule 12 to CRA.

Step 7: Check Claim Status

• Log in to your CRA My Account to track processing.
• Respond promptly to any requests for additional information.

Eligible vs. Ineligible Expenses

Eligible Costs

• Building materials (wood, cement, electrical, plumbing).
• Professional services (contractors, architects, electricians).
• Equipment rentals needed for construction.
• Permits and inspection fees.

Ineligible Costs

• Routine maintenance and repairs.
• Furniture and home appliances.
• Landscaping and outdoor works unrelated to accessibility.

By focusing only on construction-related expenses, the MHRTC ensures funds are used for functional improvements that genuinely support independence and accessibility.

Fact Check – $7,500 Home Renovation Tax Credit 2025

• Claim: $7,500 Home Renovation Tax Credit available from September 2025.
• Verdict: TRUE (with conditions).
• Key Conditions:
  • Renovation must create a secondary suite.
  • Must benefit a senior (65+) or an adult eligible for the DTC.
  • Unit must include bedroom, kitchen, bathroom, and entry.
  • Residence must be located in Canada and owned by the applicant or family member.

FAQs About $7,500 Home Renovation Tax Credit 2025

Q1. What is the $7,500 Home Renovation Tax Credit?

It is a refundable tax credit for creating a self-contained secondary unit for seniors (65+) or adults eligible for the DTC.

Q2. Who can apply for the MHRTC 2025?

Any Canadian resident who renovates their home for a senior or disabled family member, provided they meet ownership and occupancy rules.

Also Read

$698 CRA GST/HST Credit September 2025 – Eligibility, Payment Dates, and Key Updates

Q3. What is the maximum claimable amount?

Up to $7,500 per renovation project per qualifying person.

Q4. Do I need to apply separately for this credit?

No, you claim it when filing your annual income tax return using Schedule 12.

Q5. Are furniture and appliances covered?

No, only construction-related expenses like materials, permits, and contractor fees are covered.

Also Read

How to Get CRA DTC & Canada Disability Benefit in 2025: Full Guide

For More Information Click HERE