What makes a credit refundable
The difference is what happens when the credit is larger than your tax. A non-refundable credit stops at zero tax. A refundable credit is applied in the final refund or balance owing part of the return, so it can still be paid to you. The CRA lists several, including line 45200, line 45300 and line 45350, in that section.
Refundable credits usually depend on your income, your family situation or what you spent, and many are reduced as income rises. Eligibility is therefore tested by the CRA using the figures on your return.
Two examples with 2026 figures
The Canada workers benefit is described by the CRA as a refundable tax credit for people who work on a low income. For 2026 the federal maximum basic amount is $1,665 for a single individual with no children and $2,869 for a family. The amount is reduced as adjusted net income rises, and amounts differ for residents of some provinces and territories.
The refundable medical expense supplement is aimed at working people who also claim medical expenses. For 2026 the maximum is $1,534. You generally need earnings above a minimum threshold, and the supplement is reduced at higher family income, so a claim is not automatic.
An illustrative example
Suppose a single person earns a modest income, has no federal tax left after non-refundable credits and has tax withheld at source of $300. If a refundable credit of $500 applies, it is added to the $300, which would produce a refund of $800. A non-refundable credit of the same size would add nothing once the tax was already zero. The amounts are illustrative only.
Refundable credits do not change how non-refundable ones work. They are separate lines, calculated on separate rules, and a person can be eligible for one and not the other.
What to discuss with your accountant
The CRA says you still file a return to receive benefits and credits, even with no income. If you have been skipping returns because you owe nothing, ask what you may have missed and how far back the CRA allows an adjustment.
Bring your employment slips, self-employment records and any medical receipts. Ask which refundable credits are likely to apply, how income changes would affect them and whether your household’s claims should be coordinated.
Sources & editorial notes
Sources checked October 24, 2026. The examples are illustrative and provide general information. Discuss how the guidance applies to your circumstances with your accountant.
- Federal Income Tax and Benefit Information (5000-G)Canada Revenue Agency
- Canada workers benefit: How much you can getCanada Revenue Agency
- Line 45200 – Refundable medical expense supplementCanada Revenue Agency
- CRA: Indexation adjustment for personal income tax and benefit amountsCanada Revenue Agency
Rules and guidance can change. Use the current official source and confirm the treatment for your facts. To flag an error, contact Sora.