Ottawa announces automated tax filing system aimed at helping low-income Canadians get benefits they're entitled to

Ahead of releasing the promised 2025 federal budget, the prime minister announced the launch of an automated tax filing system that will trigger access to federal benefits for low-income Canadians.

The Canada Revenue Agency (CRA) aims to automatically file taxes for these folks to ensure they receive government benefits that they qualify for, according to a statement from the prime minister’s office . That includes benefits such as the GST/HST credit, the Canada Child Benefit, the Canada Disability Benefit, “ and more – including  benefits that these Canadians may not be aware they are entitled to.”

A release from the Department of Finance states that the CRA will be utilizing the automated and free process through the CRA’s “My Account” online filing system. The agency will start with about one million individuals with simple tax filings starting in 2027, scaling up to 2.5 million individuals in 2028 and approximately 5.5 million by 2029.

People who are eligible for automatic tax filing will need to provide a few details and confirm their information in a pre-filled tax form from the CRA.

Meanwhile the CRA will continue to add new information to its Auto-fill my return digital service that helps individuals using commercially sold tax software to file their tax returns.

Prime Minister Mark Carney announced the measures at a news conference Friday while in his home riding of Nepean, Ont.

The previous Liberal government was first to unveil a proposed automatic tax filing system during the 2020 throne speech. It committed to implementing the program in the 2023 budget.

Canadians who owe taxes are required to file a return each year, but many low-income Canadians often don’t because expect they don’t owe anything. However, failing to file a return means they don’t receive the benefits they need, Carney said.

For example, he noted, a single parent with two young children, earning $15,000 from a part-time job could be eligible for up to $25,000 in federal and provincial benefits.

This initiative builds on economic measures “already taken” by Ottawa, including putting an end to the consumer carbon tax, cutting taxes for 22 million middle-class Canadians, and eliminating GST for first-time homebuyers, says the PMO.

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