As of May 2025, Canadian families are receiving updated Climate Action Incentive payments (CAIP), commonly referred to as carbon rebates. These payments are designed to offset the cost of federal carbon pricing on fuel, ensuring families—especially those with lower or middle incomes—are not financially burdened by climate policies. The rebate amounts vary by province, family size, and eligibility criteria. Here’s a breakdown of how much you can expect in 2025 and what factors impact your rebate.
What Are Carbon Rebates and Who Qualifies?
The carbon rebate is part of Canada’s federal effort to return proceeds from carbon pricing directly to households. It’s available to residents in provinces where the federal carbon pricing system applies, including Alberta, Saskatchewan, Manitoba, Ontario, and more recently, Newfoundland and Labrador, Nova Scotia, and Prince Edward Island.
Eligibility requires:
- Being a resident of an applicable province.
- Filing an annual income tax return.
- Having a valid Social Insurance Number.
The rebate is issued quarterly and is non-taxable. It’s paid out automatically through direct deposit or mailed cheque, usually alongside GST/HST credit payments.
Carbon Rebate Amounts by Province in 2025
As of the May 2025 update, the federal government has adjusted the CAIP rates to reflect inflation and carbon pricing changes. Below is a table showing estimated annual rebate amounts for an average family of four:
| Province | First Adult | Second Adult | Each Child | Total (Family of 4) |
|---|---|---|---|---|
| Alberta | $772 | $386 | $193 | $1,544 |
| Saskatchewan | $680 | $340 | $170 | $1,360 |
| Manitoba | $640 | $320 | $160 | $1,280 |
| Ontario | $560 | $280 | $140 | $1,120 |
| Newfoundland & Labrador | $328 | $164 | $82 | $656 |
| Nova Scotia | $368 | $184 | $92 | $736 |
| Prince Edward Island | $240 | $120 | $60 | $480 |
These payments are disbursed quarterly—in April, July, October, and January. For May 2025, the first quarter amount would have already been received, and the second installment is due in July.
Additional Rural Supplement
If you live in a rural or small community, you may qualify for a 20% rural supplement on top of the standard rebate. This is designed to account for fewer transportation alternatives and increased energy needs in rural areas. Eligibility is typically based on your postal code as determined by the CRA.
For example, a rural family in Alberta could receive an additional $308 annually, bringing their total to $1,852. This supplement is also issued quarterly and included in your regular payment if you qualify.
How to Check Your Carbon Rebate Status
Canadians can confirm their eligibility, update banking information, or review their payment history through the CRA’s My Account portal. It’s essential to file your 2024 tax return on time to ensure your 2025 payments are processed without delay.
If you haven’t received your payment, the CRA suggests waiting 10 business days after the expected date before contacting them. Payment dates may vary slightly depending on your financial institution.
The Bigger Picture: Carbon Rebates and Policy Goals
The federal carbon pricing system aims to reduce greenhouse gas emissions by making fossil fuel consumption more expensive while rebating most of the collected revenue back to households. According to Environment and Climate Change Canada, most families receive more in rebates than they pay in carbon pricing costs.
This approach incentivizes environmentally conscious behavior without imposing financial hardship on families. It’s part of Canada’s broader climate plan to meet net-zero targets by 2050.
FAQ
What is the Climate Action Incentive Payment (CAIP)?
The CAIP is a quarterly, tax-free payment given to eligible Canadians in certain provinces to offset the cost of federal carbon pricing.
When are the carbon rebate payments made?
Payments are made in April, July, October, and January. The next payment after May 2025 is scheduled for July.
Do I need to apply for the carbon rebate?
No separate application is needed. You must file your tax return to be automatically considered for the CAIP.
What if I move to another province?
Rebate amounts are based on your province of residence on the first day of the payment month. Inform the CRA of your change of address promptly.
Is the carbon rebate considered taxable income?
No, the carbon rebate is non-taxable and does not affect other benefits or income calculations.
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