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Multigenerational Home Renovation Tax Credit Guide: Eligibility, Expenses and How to Claim

ByNorthbly Editorial Team

The Multigenerational Home Renovation Tax Credit (MHRTC) is a refundable tax credit designed to help Canadian families create secondary dwelling units for seniors or adults eligible for the Disability Tax Credit.

As housing costs continue to rise, many families are choosing multigenerational living arrangements. This credit helps offset the cost of qualifying renovations and supports independent living.

This guide explains who qualifies for the Multigenerational Home Renovation Tax Credit, eligible renovation expenses and how to claim the credit on your tax return.

Multigenerational Home Renovation Tax Credit: Quick Summary

  • The MHRTC is a refundable tax credit.
  • It supports the construction of secondary dwelling units.
  • Eligible individuals include seniors and adults with disabilities.
  • The credit can help offset renovation expenses.
  • Only one qualifying renovation may be claimed per eligible individual.
  • Supporting documentation is required.
  • The credit is claimed on your annual tax return.
  • The CRA administers the program.

What Is the Multigenerational Home Renovation Tax Credit?

The MHRTC was introduced to encourage families to create self-contained living spaces for eligible relatives.

These spaces must generally include a private entrance, kitchen, bathroom and sleeping area that allows independent living.

Who Is Eligible?

A qualifying individual is generally:

  • A senior aged 65 or older.
  • An adult eligible for the Disability Tax Credit.

The renovation must be completed for the benefit of an eligible family member.

What Is a Secondary Dwelling Unit?

A secondary dwelling unit is a self-contained residence located on the same property as the primary home.

Required Feature Typically Required?
Private Entrance Yes
Kitchen Yes
Bathroom Yes
Sleeping Area Yes
Shared Utility Access Permitted

How Much Can You Claim?

Eligible families can claim a percentage of qualifying renovation expenses up to the annual limit established by the CRA.

Because the MHRTC is refundable, eligible taxpayers may receive a payment even if they do not owe income tax.

What Expenses Qualify?

Common qualifying expenses may include:

  • Construction materials.
  • Contractor fees.
  • Electrical work.
  • Plumbing installations.
  • Building permits.

Routine maintenance and household appliances generally do not qualify.

How to Claim the MHRTC

Claiming the credit requires maintaining records of all eligible expenses.

  1. Confirm that the individual qualifies.
  2. Collect invoices and receipts.
  3. Review CRA guidance.
  4. Complete your tax return.
  5. Retain all supporting documentation.

Can Multiple Family Members Share the Credit?

Yes. In certain situations, multiple eligible individuals may share the available claim amount, subject to the annual maximum.

Examples of Eligible Renovations

Examples may include:

  • Converting a basement into an apartment.
  • Adding an in-law suite.
  • Building a garden suite.
  • Creating a separate entrance and living space.

Multigenerational Home Renovation Tax Credit Frequently Asked Questions

Is the MHRTC refundable?

Yes. The credit is refundable.

Can I build an in-law suite?

Yes. In-law suites are among the most common qualifying renovations.

Do appliances qualify?

Generally, no. Household appliances are not usually eligible expenses.

Can I claim the credit for my parents?

Yes. Seniors aged 65 and older may qualify.

Can multiple people claim the same renovation?

Yes, provided the combined claim does not exceed the CRA’s annual limit.

Related Northbly Guides

Official MHRTC Information

Visit the Canada Revenue Agency website to review qualifying renovation requirements, annual limits and eligibility rules for the Multigenerational Home Renovation Tax Credit.

Visit the Official MHRTC Website

Related Government Benefits