Multigenerational Home Renovation Tax Credit — Get Up to $7,500 for a Secondary Unit
What Is It?
The Multigenerational Home Renovation Tax Credit (MHRTC) is a refundable federal tax credit for renovations that create a self-contained secondary unit so a senior or an adult eligible for the disability tax credit can live with a qualifying relative.
The credit equals 15% of up to $50,000 of qualifying expenditures, for a maximum benefit of $7,500 per qualifying renovation.
What Makes It Powerful
Because it is refundable, the MHRTC is more valuable than a typical non-refundable credit. The project does not need to generate enough tax payable to absorb the benefit. If the renovation qualifies, the credit can produce a direct refund effect.
Do I Qualify?
- The renovation will create a self-contained secondary unit
- The unit will have a private entrance, kitchen, bathroom, and sleeping area
- The unit is for a senior age 65 or older at the end of the year, or for an adult eligible for the disability tax credit
- The renovation will allow that person to live with a qualifying relative
Who Benefits Most?
Families planning to bring an aging parent home, create a suite for a disabled adult child or relative, or redesign a property for long-term multigenerational living.
What Most People Don’t Know
- This is not just for basement suites. Additions, converted garages, and other structural solutions can qualify if they create a genuine self-contained unit.
- The claim is tied to the completed renovation. Timing matters because the credit is claimed in the tax year the renovation period ends.
- Not all costs count. The expense must be reasonable and directly attributable to the qualifying renovation.
- It can stack with the family’s broader planning goals. Families often pair this with aging-in-place decisions or disability-access renovations.
Frequently Asked Questions
Is the credit refundable or just a tax reduction?
A: It is refundable, which makes it much more valuable to households with limited tax payable.
Does a simple accessibility renovation qualify?
A: Not by itself. The project must create a self-contained secondary unit, not just improve access in the existing home.
Can multiple family members split the claim?
A: CRA allows the credit to be split among eligible individuals, but the total claim for the qualifying renovation cannot exceed the permitted limit.