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Multigenerational Home Renovation Tax Credit (MHRTC) Canada - Complete 2025 Guide
A practical, homeowner-first explainer on how to unlock up to $7,500 from the federal MHRTC when you build a self-contained secondary unit for a senior family member or an adult eligible for the Disability Tax Credit.
What Exactly Is the Multigenerational Home Renovation Tax Credit?
The MHRTC is a refundable federal credit introduced in the 2022 Fall Economic Statement and available for the 2023, 2024, and 2025 tax years. Claim 15% of up to $50,000 in eligible renovation expenses (maximum $7,500) when you create a self-contained secondary dwelling unit for a qualifying family member.
"Refundable" matters: even if your tax bill is zero, the CRA will still send you the refund once the claim is approved.
Quick math
Spend
$50,000
Credit $7,500
Spend
$30,000
Credit $4,500
Spend
$60,000
Credit still $7,500
Who Qualifies?
Qualifying individual (lives in the new suite)
- Senior aged 65+ by December 31 of the tax year, or
- Adult 18+ eligible for the Disability Tax Credit (DTC)
Eligible individual (claims the credit)
- The qualifying individual, their spouse/partner, or
- A qualifying relation: parent, grandparent, child, grandchild, sibling, aunt, uncle, niece, or nephew
Ownership + residency
- Home must be in Canada and owned by the qualifying or eligible individual (or their spouse/partner).
- The new unit must be within or attached to the existing home (not a detached garden suite or laneway house).
Fast checklist
- Qualifying individual is 65+ or DTC-eligible
- You own the property in Canada
- Suite is self-contained (kitchen, bath, sleeping area)
- Attached or inside the main dwelling
- Itemized contractor invoices and permits in hand
- One claimant per qualifying individual
What Renovation Expenses Are Eligible?
The CRA allows a broad list of hard costs directly tied to building the secondary unit. Keep receipts, permits, and contracts organized - appliances and routine repairs do not qualify.
Eligible expenses
- Building materials, labour, permits, and equipment rentals
- Plumbing, electrical, HVAC for the new unit
- Kitchen and bathroom installation
- Architectural or engineering fees tied to the project
- Windows and doors specific to the secondary unit
Not eligible
- Furniture and appliances
- Routine maintenance unrelated to the suite
- Detached garden suites or laneway houses
- Tools you purchased (rentals are fine)
- Costs already reimbursed by grants or insurance
How to Claim the MHRTC
- Finish the renovation and ensure the suite has a private entrance, kitchen, bathroom, and sleeping area.
- Organize receipts, invoices, contracts, and permits by date and category.
- Report the credit on Line 45355 of your T1 return for the year the renovation is completed.
- Only one person can claim per qualifying individual - decide within the family before filing.
- Keep records for at least six years; the CRA can request support anytime.
Real-world snapshot
The Chowdhury family in Brampton converts an unfinished basement into a suite for a 72-year-old parent - permits, framing, electrical, plumbing, kitchen, bath, HVAC, finishes, and a separate entrance total $50,000. Their refundable MHRTC refund: $7,500.
Pro tip
In higher-cost cities (Toronto, Vancouver), expenses may exceed $50,000. You still claim the max $7,500, so budget accordingly.
Can You Combine the MHRTC With Other Credits?
Yes - carefully. The MHRTC can pair with accessibility or energy programs when expenses are clearly separated.
- Home Accessibility Tax Credit (HATC): Up to $20,000 in eligible expenses for accessibility upgrades. Do not double-claim the same cost under both credits.
- Provincial programs: BC Home Renovation Tax Credit for Seniors, Quebec's LogiRenov/RenoVert (availability varies). Rules differ by province.
- Greener Homes grants/loans: Use for energy upgrades (insulation, windows, heat pumps) done alongside the suite build.
Common mistakes to avoid
- Missing or disorganized receipts and permits.
- Including appliances, furniture, or unrelated renovations.
- Building a detached suite (laneway/garden) instead of an attached unit.
- Failing local zoning or building code requirements.
- Assuming multiple family members can all claim for the same individual.
FAQ highlights
Detached laneway house?
Not eligible - the suite must be part of or attached to the main dwelling.
DIY labour?
You can claim materials you purchase; you cannot claim your own labour value.
Timing for seniors turning 65?
They must be 65+ by December 31 of the year the renovation period ends.
Multiple contributors?
Only one claim per qualifying individual; decide who files before submitting.
Checklist Before You Start Your MHRTC Renovation
- Confirm the qualifying individual meets the age (65+) or DTC requirement.
- Verify the family relationship qualifies under CRA rules.
- Ensure you or the qualifying individual owns the property in Canada.
- Check zoning bylaws and secure building permits before work starts.
- Design a self-contained unit (entrance, kitchen, bathroom, sleeping area).
- Keep quotes and invoices itemized for suite-specific costs.
- Decide which family member will claim the credit.
- Separate non-eligible items (appliances, landscaping, detached work).
- Plan for the $50,000 lifetime cap per qualifying individual.
- Coordinate with HATC/provincial programs without double-claiming.
- Prepare to file on Line 45355 in the year the renovation is completed.
- Store all documentation for at least six years.
Is the MHRTC worth it?
For most families planning a secondary suite, the renovation is happening regardless - the refundable $7,500 simply reduces the out-of-pocket cost. The key is structuring the project properly, keeping documentation clean, and ensuring the unit is attached to the home. If you finished a qualifying build in 2023 or 2024 and missed the credit, file an adjustment and claim it retroactively.