For many families in Scarborough, Markham, Pickering, Ajax, Whitby, Oshawa and across the Greater Toronto Area, the conversation around aging at home often starts with stairs. Stairlifts and porch lifts are excellent solutions when loved ones want to remain in their existing bedrooms or continue using multiple levels of the home. In some cases, however, secondary suites may make more sense.
If an aging parent or an adult family member with a disability needs more privacy, easier access and daily support close by, the Multigenerational Home Renovation Tax Credit (MHRTC) may help reduce the cost of creating a safer living arrangement.
What is the MHRTC?
The Multigenerational Home Renovation Tax Credit is a federal refundable tax credit introduced for 2023 and later tax years. According to the Canada Revenue Agency, the MHRTC can be claimed for eligible renovation expenses used to create a self-contained secondary unit. It allows a senior or an adult eligible for the Disability Tax Credit to live with a qualifying relative.
The CRA’s 2023 tax tip described the credit as helping families offset the cost of “constructing a secondary suite” for a senior or family member with a disability. At that time, the credit was calculated as 15% of up to $50,000 in eligible expenses, for a maximum refundable credit of $7,500.
For current tax years, families should confirm the applicable rate on the CRA website before filing. The CRA’s current MHRTC page states that eligible individuals may claim up to $50,000 in qualifying expenditures, with the credit calculated at 14.5%, to a maximum of $7,250.
When would a secondary suite be better than a stair solution?
Stairlifts and porch lifts are often practical accessibility upgrades. They can help people continue using their existing homes safely without major layout changes. A secondary suite may be the better option when the family’s needs go beyond moving between floors.
For example, an aging parent may need a private living space with a bedroom, bathroom, kitchenette and easy entrance, while still being close enough for family support. An adult child with a disability may benefit from greater independence while remaining connected to caregivers. In these cases, building or converting space into a secondary unit may offer a long-term solution that supports both privacy and safety.
As Woodsmith Construction Inc. notes, “families in Toronto are increasingly looking for ways to live together comfortably across generations.” Rising housing costs, aging parents and accessibility needs have made multigenerational living more attractive for many households.
Who qualifies under CRA guidelines?
The CRA requires that the renovation create a secondary unit for a qualifying individual. A qualifying individual is either a senior who is 65 or older at the end of the renovation period tax year, or an adult who is 18 or older and eligible for the Disability Tax Credit. The unit must allow that person to live with a qualifying relation.
A qualifying relation may include close family members such as a parent, grandparent, child, grandchild, sibling, aunt, uncle, niece or nephew. The person claiming the credit must also meet CRA rules for eligible individuals. They may include the qualifying individual, his/her spouse or common-law partner, or a qualifying relation who owns or ordinarily lives in the dwelling.
What counts as a secondary unit?
The CRA defines a secondary unit as a self-contained housing unit with a private entrance, kitchen, bathroom and sleeping area. It must be newly constructed or created from an existing living space that did not already meet local requirements as a secondary dwelling unit. It must also comply with applicable permits, codes and bylaws.
This is important because cosmetic renovations usually will not qualify. Replacing floors, painting walls or updating a bathroom alone is not enough. The project must create or adapt a full secondary living space. Examples may include a basement apartment, laneway suite, garden suite, garage conversion or addition that creates a separate apartment, provided it meets CRA and local requirements.
What expenses can be claimed?
Eligible expenses generally include renovation costs directly related to creating the qualifying secondary unit. This may include construction labour, building materials, permits, design work, electrical, plumbing and other necessary work tied to the creation of the unit. The CRA states that the MHRTC is refundable. This means the credit may still generate a refund if it is more than the taxes owed.
Families should keep careful records. The CRA advises that eligible expenses must be supported by agreements, invoices and receipts. These documents should show that the amounts were paid in full or be supported by proof of payment, such as a credit card slip or cancelled cheque.
How can you claim the MHRTC?
The MHRTC is claimed on line 45355 of your T1 income tax and benefit return. The CRA instructs taxpayers to use Schedule 12, Multigenerational Home Renovation Tax Credit, to report eligible expenses and calculate the credit. The renovation must be completed in the tax year for which the claim is made, even if the project began earlier.
The CRA also notes that one qualifying renovation can generally be claimed during the lifetime of a qualifying individual, although separate qualifying renovations may be possible for separate qualifying individuals. Because tax rules can change, it is wise to speak with a tax professional before filing, especially if multiple family members paid for the renovation or ownership of the property is shared.
Frequently Asked Questions (FAQs).
What is the Multigenerational Home Renovation Tax Credit (MHRTC)?
The MHRTC is a federal refundable tax credit for eligible renovations that create a self-contained secondary unit for a senior or an adult eligible for the Disability Tax Credit to live with a qualifying relative.
How much can I claim?
The CRA allows eligible individuals to claim up to $50,000 in qualifying renovation expenses. The maximum credit depends on the tax year, so confirm the current rate before filing.
Does a basement renovation automatically qualify?
No. The renovation must create a self-contained secondary unit with its own entrance, kitchen, bathroom and sleeping area. It must also meet applicable local rules.
Can I claim the MHRTC for a stairlift?
No. The MHRTC is for creating a qualifying secondary unit. A stairlift may qualify under other programs or credits, depending on the situation.
Do I need receipts?
Yes. Keep agreements, invoices, receipts and proof of payment. The CRA may ask for documentation to support your claim.
Should I choose a secondary suite or mobility equipment?
It depends on your family’s needs. A secondary suite may suit long-term multigenerational living, while stairlifts and porch lifts can be faster, less disruptive solutions for improving access within an existing home.
How can LifeCare Mobility Solutions help?
A secondary suite can be a wonderful solution, but it is not always the only one. Some families may get the accessibility they need with a stairlift, porch lift, home hospital bed, mobility scooter, walker, rollator or wheelchair. Others may benefit from combining home renovations with mobility equipment to create a safer daily routine.
To learn more about our high-quality mobility solutions, please don’t hesitate to call us at 416-267-9800 or email us at info@lifecaremobility.ca. You may also contact us by filling out the form on our Contact page!
