Heads up, parents! The Canada Revenue Agency (CRA) is making changes to some benefit payments for 2025, and it’s good news for families feeling the pinch of the rising cost of living.
Each year, the CRA adjusts the federal income tax brackets and certain benefit amounts to match inflation in Canada based on changes in the Consumer Price Index. One benefit getting a boost next year is the Canada Child Benefit (CCB), a key government payment designed to ease the cost of living for parents across Canada.
For 2025, the CRA has announced that the inflation-indexed bump is 2.7%.
That means starting next July, the maximum annual CCB amount is going up to $7,997 for kids under six and $6,748 for children aged 6 to 17. That’s a jump of $210 and $178 respectively compared to 2024, which saw larger increases due to higher inflation.
Payments will begin to reflect these new amounts as early as the July 2025 installment, coinciding with the start of the benefit year, and they’ll be based on your 2024 tax return.
Along with the higher benefit amounts, the adjusted family net income (AFNI) threshold where the CCB starts to phase out is also going up, from $36,502 in 2024 to $37,487 in 2025. This change means more families could qualify for the maximum benefit or see less of a reduction if their income stays the same.
If you’re not familiar with the CCB, here’s a quick rundown: This tax-free child benefit payment supports parents or guardians raising kids under 18. The CRA calculates how much you’ll get based on your AFNI from the previous tax year, the number of children you have and their ages.
If your AFNI is under the threshold, you get the maximum amount. For families earning above the threshold, the payments taper off based on income.
If you have a child who qualifies for the Disability Tax Credit, there’s even more support. The Child Disability Benefit, which is paid out along with the CCB payment, is also increasing in 2025, offering up to $3,411 annually for eligible children, with the income phase-out threshold rising to $81,222.
Keep an eye on your bank account starting July 2025 to see the new amounts roll in!
Source: MTL Blog
