Multigenerational Home Renovation Tax Credit: adding a unit for a parent or family member

Building a suite for an aging parent is one of the fastest-growing renovation projects. The federal Multigenerational Home Renovation Tax Credit is refundable, but its conditions are specific, and a design that misses one of them can lose the credit.

Who it is for

The renovation must benefit a qualifying individual: someone 65 or older at the end of the tax year of the renovation period, or an adult aged 18 to 64 who is eligible for the disability tax credit. The claimant either lives in the unit or is a qualifying relation who owns the home.

What the unit needs

The renovation must create a secondary unit with its own private entrance, bedroom, bathroom and kitchen. The home must be in Canada, and the qualifying individual and a qualifying relation must ordinarily live there within 12 months after the renovation period ends.

How much

Eligible expenses are capped at $50,000 per renovation. When costs are shared, more than one eligible person can claim for the same renovation, up to a combined $50,000. The credit is refundable, so it can produce a refund even if you owe no tax. CRA's current guidance should be checked for the rate in your tax year.

One claim per lifetime

Only one renovation can be claimed for a given qualifying individual during their lifetime. Expenses already claimed as medical expenses or under the Home Accessibility Tax Credit do not count, and costs paid to non-arm's-length persons generally do not qualify unless they are registered for GST/HST.

Design and permits come first

The tax credit does not replace building permits and code requirements for a secondary unit. Plan the separate entrance, kitchen and bathroom with your designer, and keep itemized invoices for the claim on line 45355 with Schedule 12.

Prevention Checklist

• Confirm the qualifying individual's age or disability tax credit eligibility.
• Design the unit with its own entrance, bedroom, bathroom and kitchen.
• Get the building permit for the secondary unit.
• Keep itemized invoices and proof of payment; cap eligible costs at $50,000.
• Make sure everyone moves in within 12 months after the renovation period.

References

1. Canada Revenue Agency. Multigenerational home renovation tax credit (MHRTC): who can claim, Web page, Eligibility. Accessed 2026-11-01.
2. Canada Revenue Agency. Expenses you can claim - MHRTC, Web page, Eligible expenses, $50,000, exclusions. Accessed 2026-11-01.

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