The Canada Child Benefit (CCB) helps families with children afford essential care and support for their upbringing. The Canada Revenue Agency (CRA) reviews and adjusts the CCB amount annually based on inflation. For 2025, the benefit has increased by 2.7%, providing additional financial relief to families.
Starting in July 2025, the updated CCB payments will be calculated based on 2024 tax returns. This increase will be particularly beneficial for parents facing rising expenses. The benefit applies to families with children under six years old and those aged 6 to 17. Additionally, the phase-out thresholds for both the Child Disability Benefit (CDB) and the CCB have been adjusted, allowing more families to qualify for maximum benefits. Let’s explore how these changes will impact the CCB in 2025.
Why Was the CCB Increased?
Each year, the CRA adjusts the CCB based on the inflation rate, which is determined by the Consumer Price Index (CPI). The 2.7% increase for 2025 ensures that the benefit keeps up with the cost of living.
The updated amounts will take effect in July 2025 and will be based on 2024 tax returns. This increase will help Canadian families manage rising costs associated with raising children.
New CCB Amounts for 2025
The CCB is determined by factors such as the number of children, their ages, and a family’s Adjusted Family Net Income (AFNI). The maximum annual benefit for 2025 is:
- Children under 6 years old:
- New maximum: $7,997 (previously $7,787 in 2024)
- Increase: $210
- Children aged 6 to 17 years:
- New maximum: $6,748 (previously $6,570 in 2024)
- Increase: $178
These payments are tax-free, and families are not required to repay them. The benefit is paid monthly, helping parents cover childcare and other related expenses.
Changes to the Phase-Out Threshold
The phase-out threshold determines the income level at which benefits start decreasing. For 2025, this threshold has increased from $36,502 to $37,487.
This means that more families may qualify for higher benefits, as the reduction in payments now starts at a higher income level. For instance, a family earning $37,000 in 2025 would receive more CCB than in 2024 due to the increased threshold.
How is the CCB Calculated?
The CRA calculates CCB payments based on a family’s adjusted net income and other key factors:
- Family income: Lower-income families receive higher benefits. As income increases, the benefit amount gradually decreases.
- Number of children: Families with more children receive greater benefits.
- Children’s age: Higher payments are provided for children under six compared to those aged 6 to 17.
CCB payments are made monthly, and any changes in family income can impact the benefit amount.
Child Disability Benefit (CDB) – Additional Support
Families with children who qualify for the Disability Tax Credit (DTC) receive the Child Disability Benefit (CDB) in addition to the CCB.
For 2025, the CDB has also increased by 2.7%:
- New maximum CDB amount: $3,411 per year (previously $3,319 in 2024)
- Phase-out threshold: $81,222
This adjustment ensures that families caring for children with disabilities receive additional financial assistance to help cover extra costs associated with their child’s needs.
When Will the Changes Take Effect?
The new CCB rates will come into effect in July 2025. These updated payments will be calculated based on 2024 tax returns, so it is essential for families to file their taxes on time to receive the correct benefit amount.
CCB Updates Summary for 2025
- The CCB has increased by 2.7% to align with inflation.
- The maximum benefit is now $7,997 for children under six and $6,748 for children aged 6 to 17.
- The phase-out threshold has increased to $37,487, allowing more families to receive higher benefits.
- The Child Disability Benefit (CDB) has also increased to $3,411 per year.
- The new amounts take effect in July 2025, based on 2024 tax returns.
Conclusion
The CCB increase for 2025 provides essential financial support to Canadian families, ensuring they can better manage the rising costs of raising children. The adjustments to the CDB and phase-out thresholds also mean that more families can benefit from these payments.
To maximize your CCB entitlement, ensure you file your taxes on time and stay informed about these updates.
Frequently Asked Questions (FAQs)
Q: What is the Canada Child Benefit (CCB)?
A: The CCB is a tax-free monthly payment that helps eligible families cover the costs of raising children under 18 years old.
Q: Who qualifies for the CCB in 2025?
A: Eligibility requires residing in Canada for tax purposes, living with a child under 18, being the primary caregiver, and filing an annual tax return.
Q: How can I apply for the CCB?
A: You can apply online through the CRA’s My Account portal or by submitting Form RC66, Canada Child Benefits Application.
