Multigenerational Home Renovation Tax Credit (MHRTC) 2026

MHRTC — Multigenerational Home Renovation Tax Credit: Full Guide

The Multigenerational Home Renovation Tax Credit (MHRTC) was introduced in Canada's 2023 federal budget and applies to renovation expenses incurred after January 1, 2023. It provides a non-refundable 15% federal tax credit on up to $50,000 of eligible renovation expenses specifically for creating a secondary suite to house a qualifying family member. The maximum credit is $7,500.

MHRTC Eligibility Requirements

To claim the MHRTC, all of the following must be true:

• You own the qualifying home (or the qualifying individual does, or both)
• The qualifying individual is a senior aged 65+ or an adult eligible for the Disability Tax Credit
• The qualifying individual is a family member (parent, grandparent, child, sibling, aunt/uncle, niece/nephew, or their spouse)
• The renovation creates a self-contained secondary unit with its own kitchen, bathroom, and separate living space
• The qualifying individual ordinarily lives (or will live) in the secondary unit
• Each claimant can only make one MHRTC claim in their lifetime per eligible renovation

What Expenses Are Eligible?

Eligible expenses include: labour and professional services for construction or renovation, materials (lumber, drywall, flooring, plumbing fixtures, electrical components), permits and inspections, and equipment rentals directly related to the renovation. Expenses must be supported by receipts from GST/HST-registered contractors.

Not eligible: Financing costs, furniture and appliances (these aren't structural), maintenance items, or expenses paid to family members not registered in the business.

Claiming the MHRTC on Your Tax Return

The MHRTC is claimed on Schedule 12 of your T1 income tax return. Because it's non-refundable, it reduces your federal tax owing to a minimum of zero — if your credit exceeds your tax owing, you won't receive the excess as a refund. This distinguishes it from Ontario's refundable Seniors' Home Safety Tax Credit, which pays out even if you owe no tax.

Combining MHRTC with HATC and Other Credits

The MHRTC can generally be claimed alongside the federal Home Accessibility Tax Credit (HATC) for expenses that qualify under both programs. For a renovation creating an accessible suite for a DTC-eligible family member, you might claim MHRTC (15% on up to $50,000) and HATC (15% on up to $20,000) on overlapping or separate expenses — potentially combining for $10,500 in credits on a $70,000 renovation.