The landscape of personal and business finances in Ontario can often feel intricate, with various regulations and opportunities that are not always immediately apparent. While many individuals and businesses diligently prepare their tax returns, a significant number may be overlooking valuable Ontario tax credits in 2025 that could lead to substantial savings. You may claim these provisions if you meet the eligibility criteria. They apply to Ontario residents and are administered provincially or federally.
This guide aims to demystify some of these lesser-known opportunities within the Ontario tax credits 2025 framework, providing a clear overview for both individuals and businesses. By understanding what’s available and how to claim it, you can ensure you are not leaving money on the table.
Understanding Ontario Tax Credits in 2025
Ontario tax credits reduce the amount of tax you owe. Refundable credits give you a refund even if you owe no tax. Non-refundable credits lower your tax to zero but do not provide a refund.
In 2025, new credits and enhancements will support specific groups. These include families undergoing fertility treatments, seniors, and businesses investing in apprenticeships or infrastructure.
Source: 2025 Ontario Budget – Chapter 1B: Delivering Better Services
Personal Ontario Tax Credits 2025
Ontario Fertility Treatment Tax Credit
A new refundable credit for 2025 provides coverage of 25% on eligible fertility and surrogacy expenses, capped at $20,000 per year. This credit reimburses costs such as IVF procedures, fertility medications, diagnostic tests, travel related to treatment, and storage fees for eggs or embryos.
Source: CARE Fertility
Climate Action Incentive Payment (CAIP)
Ontario residents qualify for the Canada Carbon Rebate (CCR), formerly called the Climate Action Incentive Payment (CAIP). This tax-free, refundable payment arrives quarterly to help offset costs from federal carbon pricing on gasoline, heating, and other fuels.
The CRA issues payments automatically once you file your annual income tax return. No separate application is required.
Source: Canada Revenue Agency – Canada Carbon Rebate (formerly CAIP)
Senior Homeowners’ Property Tax Grant
Low- and moderate-income seniors in Ontario may qualify for the Ontario Senior Homeowners’ Property Tax Grant. This non-refundable credit helps offset residential property tax costs. Eligible applicants must be 64 years of age or older, reside in Ontario, and have paid property tax on their primary residence. The grant can be claimed when filing your tax return using the ON-BEN form.
Source: Canada Revenue Agency – Ontario Senior Homeowners’ Property Tax Grant (OSHPTG)
Expanded Medical Expense and Disability Tax Credits
Ontario has broadened eligible medical expenses to include home modifications, medical travel, and assistive devices. The Disability Tax Credit now permits claims up to 10 years retroactively, allowing eligible individuals to recover past credits.
Source: CRA – Medical and Disability Expenses
Business and Employer Tax Credits in Ontario 2025
Ontario Apprenticeship and Federal Apprenticeship Job Creation Tax Credits
Employers who hire apprentices in Ontario can access two significant incentives:
- Ontario Apprenticeship Training Tax Credit (OATTC):
A refundable credit of up to $5,000 per apprentice per year, helping to offset the costs associated with apprenticeship programs provided by the province.
Source: Canadian Apprenticeship Forum - Federal Apprenticeship Job Creation Tax Credit (AJCTC):
A non‑refundable credit equal to 10% of eligible apprenticeship wages, up to $2,000 per apprentice per year, claimable during the first two years of their training. unused credits can be carried back three years or forward twenty years.
Source: Canada Revenue Agency – Apprenticeship Job Creation Tax Credit
Ontario Manufacturing Investment Tax Credit (OMMITC)
Between May 15, 2025, and January 1, 2030, Ontario offers a refundable tax credit of 15% (up from 10%) on qualifying investments in manufacturing machinery, processing equipment, and certain building costs. The annual claim cap is $3 million per taxpayer.
Importantly, non-CCPC (non‑Canadian-controlled private corporation) entities are now eligible for a 15% non-refundable credit, with the option to carry unused credits forward for up to 10 years. A repayment provision also applies: if the eligible property is sold, repurposed, or removed from use within five years of acquisition, part or all of the credit must be returned.
Source: KPMG Canada – Highlights of the 2025 Ontario Budget
Source: Doane Grant Thornton LLP – Ontario Made Manufacturing Investment Tax Credit Summary
Ontario Shortline Railway Investment Tax Credit
A new refundable corporate tax credit offers 50% reimbursement on eligible shortline railway maintenance expenditures, capped at $8,500 per track mile per year. This credit applies to both capital and direct labor costs tied to track, bridge, tunnel, or trestle maintenance. It is available for qualifying shortline operators from May 15, 2025, through December 31, 2029, and aims to support regional rail infrastructure and supply chain resilience.
Source: Ontario Budget – Shortline Railway Tax Credit (Annex)
Source: Progressive Railroading – Short-Line Credit Announcement
Additional Employer Payroll Tax Relief
The Employer Health Tax (EHT) exemption threshold now reduces payroll tax for small businesses. In addition, WSIB rate cuts and rebates should save employers about $150 million each year, lowering operational costs.
Source: 2025 Ontario Budget Highlights
Key Updates in Ontario Tax Credits 2025
- Fertility Treatment Tax Credit: Introduces a 25% refundable credit, up to $5,000 per year on eligible fertility and surrogacy expenses of up to $20,000.
- Manufacturing Investment Tax Credit (OMMITC): Increased to a 15% refundable credit for CCPCs and 15% non-refundable for non-CCPCs, with expanded eligibility.
- Shortline Railway Tax Credit: A 50% refundable credit to support maintenance of regional rail infrastructure, capped at $8,500 per track mile.
- Permanent Fuel Tax Reduction: Gasoline and diesel taxes permanently lowered by 9¢ per litre to ease energy costs.
Source: Crowe LLP – Top Four Takeaways from the 2025 Ontario Budget
Maximizing Your Ontario Tax Credits in 2025
To fully benefit from Ontario tax credits 2025:
- Keep detailed records of expenses eligible for personal credits, including medical, fertility, travel, and disability-related costs.
- Document all business investments related to apprentices, manufacturing equipment, and railway infrastructure.
- Utilize official CRA and Ontario forms, such as ON428, to claim provincial credits accurately.
- Submit your tax return early to expedite refundable credit processing.
- Consult with a tax professional to navigate complex rules, carry-forwards, and recapture provisions.
Conclusion
The Ontario tax credits 2025 landscape offers important opportunities for tax savings and refundable benefits for individuals and businesses. Staying informed about new credits is critical for effective tax planning.
At AccTax, we help individuals and business owners make the most of Ontario’s available tax credits. Whether you’re planning to claim fertility-related expenses, support apprenticeships, or invest in equipment, we offer clear, practical guidance every step of the way. Schedule a consultation and see how we can help you claim what you’re entitled to with confidence.
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