This tax credit started with the 2019 tax year, and is claimed on the tax return. The tax credit is based on family income and eligible child care expenses. Lower income families would get a higher percentage tax credit.
The CARE credit is based on family "adjusted" income, eligible child care expenses, and the net income of the child being claimed. The net income must be less than the maximum federal basic personal amount for the year, which is shown in the federal tax rate tables.
The CARE credit is included in the Detailed Canadian Tax and RRSP Savings Calculator automatically based on the fact that there are eligible child care expenses entered. The calculator automatically uses family net income for the calculation.
To calculate adjusted income, the following are added back to line 23600 net income from the tax return:
The tax credit rate is dependent on the adjusted family income, as follows:
| Adjusted family income |
Tax Credit |
Reduced by |
| $20,000 or less | 75% | n/a |
| over $20,000 up to $40,000 | 75% | 2% for each $2,500 or portion above $20,000 |
| over $40,000 up to $60,000 | 59% | 2% for each $5,000 or portion above $40,000 |
| over $60,000 up to $150,000 | 51% | 2% for each $3,600 or portion above $60,000 |
| over $150,000 | 0% |
Example:
Adjusted family income of $51,000: The tax credit rate is 59% - 2% x ($51,000 - $40,000) / $5,000.
Since ($51,000 - $40,000) / $5,000 = 2.2, this is rounded up to 3. This makes the equation:
59% - 2% x 3 = 59% - 6% = 53% tax credit rate.
The tax credit rate is multiplied by the allowable child care expense deduction. If actual expenses incurred totalled $9,600 but the maximum allowable deduction is $8,000, the refundable tax credit would be 53% x $8,000 = $4,240.
If the adjusted family income was $50,000, the tax credit rate would be 55%, with a tax credit of $4,400.
Too complicated? To make things easier, we've created a table showing all levels of the tax credit rate.
| Adjusted Family Income | CARE Tax Credit Rate |
|
| Greater than | and up to | |
| $0 | $20,000 | 75% |
| 20,000 | 22,500 | 73% |
| 22,500 | 25,000 | 71% |
| 25,000 | 27,500 | 69% |
| 27,500 | 30,000 | 67% |
| 30,000 | 32,500 | 65% |
| 32,500 | 35,000 | 63% |
| 35,000 | 37,500 | 61% |
| 37,500 | 40,000 | 59% |
| 40,000 | 45,000 | 57% |
| 45,000 | 50,000 | 55% |
| 50,000 | 55,000 | 53% |
| 55,000 | 60,000 | 51% |
| 60,000 | 63,600 | 49% |
| 63,600 | 67,200 | 47% |
| 67,200 | 70,800 | 45% |
| 70,800 | 74,400 | 43% |
| 74,400 | 78,000 | 41% |
| 78,000 | 81,600 | 39% |
| 81,600 | 85,200 | 37% |
| 85,200 | 88,800 | 35% |
| 88,800 | 92,400 | 33% |
| 92,400 | 96,000 | 31% |
| 96,000 | 99,600 | 29% |
| 99,600 | 103,200 | 27% |
| 103,200 | 106,800 | 25% |
| 106,800 | 110,400 | 23% |
| 110,400 | 114,000 | 21% |
| 114,000 | 117,600 | 19% |
| 117,600 | 121,200 | 17% |
| 121,200 | 124,800 | 15% |
| 124,800 | 128,400 | 13% |
| 128,400 | 132,000 | 11% |
| 132,000 | 135,600 | 9% |
| 135,600 | 139,200 | 7% |
| 139,200 | 142,800 | 5% |
| 142,800 | 146,400 | 3% |
| 146,400 | 150,000 | 1% |
| 150,000 | 0% | |
Ontario Child Care Tax Credit (Childcare Access and Relief from Expenses (CARE) Tax Credit)
Revised: November 25, 2025