Overview

The Ontario Tax Reduction lowers or eliminates the income tax you may pay in Ontario.

The amount of your reduction depends on:

  • where you lived at the beginning and end of the tax year
  • how many dependants you have
  • your marital status
  • your payable income tax

Eligibility

Where you live

You must be a Canadian resident on January 1 and an Ontario resident on December 31 of that same tax year to qualify.

For example, if you lived in Ontario on December 31 of a taxation year, but you lived outside Canada on January 1 of that same year, you cannot claim the Ontario Tax Reduction.

Your dependants

You can claim a reduction for:

  • each dependant child age 18 years or under
  • each dependant of any age with a mental or physical impairment

If an eligible child turns 18 during the year (or dies during the year), you can still claim the reduction for that child.

Only one person can claim the reduction for a dependant child born in 1998 or later, or for a dependant with a mental or physical impairment.

You cannot claim a reduction for children who became eligible dependants of another individual by December 31 of the year.

Your marital status

If you had a spouse or common-law partner on December 31, only the person with the higher net income can claim the Ontario Tax Reduction.

If you get separated or divorced during the year, the parent receiving the Canada Child Benefit claims the Ontario Tax Reduction.

If both parents receive the Canada Child Benefit, the parent receiving the higher amount claims the Ontario Tax Reduction. If both parents receive equal Canada Child Benefit amounts, the parent with the lower net income claims the reduction for the children.

Your income tax

You cannot claim the Ontario Tax Reduction if you have to pay Ontario additional tax for minimum tax purposes.

How to get the Ontario Tax Reduction

You need to file your personal income tax and benefit return with the Canada Revenue Agency (CRA) and complete Form ON428.

Objections

Contact the Canada Revenue Agency if:

  • you did not receive Ontario tax credits or an Ontario tax reduction to which you believe you are entitled
  • you received less than expected
  • you have been asked to repay a credit under an assessment or reassessment made by the federal government

You can make a formal objection to the CRA by following the process set out in its Notice of Assessment or Reassessment.

Other tax credits and benefits

You and your family could receive other Ontario tax credits. Use the tax credit calculator to learn more.

You can also visit the Canada Revenue Agency site for more information on credits and benefits or call 1-877-627-6645.

Updated: August 25, 2021
Published: April 06, 2018