Canada $7,500 MHRTC Credit 2025: Who Qualifies, What Counts, and How to Claim It Right

As Canadian families increasingly embrace multigenerational living to ease housing pressures and support aging loved ones or adults with disabilities, the federal government is stepping in to help. The Multigenerational Home Renovation Tax Credit (MHRTC) is a new refundable tax credit that can save homeowners up to $7,500 on eligible renovations completed in 2025.

What is the MHRTC?

The Multigenerational Home Renovation Tax Credit (MHRTC) is a one-time, refundable federal tax credit offered by the Canada Revenue Agency (CRA). It helps offset renovation expenses when creating a self-contained secondary unit within an existing home for:

• A senior aged 65 or older, or
• An adult (18–64) who qualifies for the Disability Tax Credit (DTC).

Key Details of the MHRTC 2025

Who Can Claim the MHRTC?

To qualify for the MHRTC in 2025, you must meet all three of the following conditions:

1. Qualifying Individual

Someone who will live in the secondary unit and is:

• 65 years or older, or
• 18 to 64 years old and eligible for the Disability Tax Credit (DTC).

2. Eligible Individual (the claimant)

The person claiming the credit must:

• Be a Canadian resident all year (Jan 1 – Dec 31, 2025),
• Own the home being renovated,
• Personally pay the renovation expenses.

3. Eligible Renovation

The renovation must:

• Be to an existing dwelling in Canada,
• Create or modify a self-contained secondary unit, including:
  • A private entrance,
  • A kitchen or kitchenette,
  • A bathroom,
  • A sleeping area,
• Be fully completed in 2025.

What Expenses Qualify for the $7,500 Tax Credit?

You can claim up to $50,000 in qualifying renovation costs, with 15% refunded (maximum $7,500). Eligible expenses include:

• Construction materials (drywall, flooring, insulation, etc.)
• Design plans, permits, and inspections
• Trades and professional services (plumbing, electrical, carpentry)
• Rental tools or equipment used in the project
• Labour and contractor costs
• Fixtures and built-in appliances essential to secondary living

Note: You must retain detailed receipts and invoices for all eligible expenses.

How to Claim the MHRTC on Your 2025 Tax Return

Follow these steps to receive the refund in 2026:

1. Finish the Renovation: Ensure it’s 100% complete in the 2025 calendar year.
2. Keep Records: Collect and save receipts, contracts, permits, and photos of completed work.
3. File Your Taxes in 2026:
   • Complete Schedule 12 for MHRTC.
   • Enter the claim on Line 45355 of your 2025 T1 tax return.
   • Submit all required supporting documents if requested by the CRA.

Frequently Asked Questions (FAQs)

When will I receive the MHRTC amount?

It is a refundable tax credit, meaning you’ll receive the refund after filing your 2025 tax return in 2026—not a direct payment during the renovation.

Can I claim MHRTC more than once?

No. The credit is one-time per qualifying individual. You cannot reapply for the same person.

What if the renovation isn’t done by December 31, 2025?

You will not be eligible for the MHRTC if the renovation is incomplete, even if costs are incurred.

Why the MHRTC Matters

With the rising cost of housing and limited long-term care options, many Canadians are creating multigenerational households. The MHRTC:

• Reduces renovation costs,
• Encourages independent living for seniors and adults with disabilities,
• Supports families caring for loved ones under one roof.

Final Thoughts

The $7,500 Multigenerational Home Renovation Tax Credit in 2025 is a valuable opportunity for homeowners investing in family-focused living. By planning early, tracking expenses, and following CRA guidelines, you can maximize your refund and build a more inclusive home environment.

For full details and eligibility checks, visit the official CRA MHRTC page or speak with a licensed tax professional.