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Working Income Tax Benefit

In February 2007, the Government of Canada introduced the Working Income Tax Benefit (WITB) as a refundable tax credit to provide tax relief for eligible working low-income individuals and families who are already in the workforce and to encourage other Canadians to enter the workforce. The WITB includes an additional disability supplement for eligible recipients.

Who can receive the WITB?

You can receive the WITB if you are:

• 19 years of age or older on December 31, 2007;
• a resident of Canada throughout the year; and
• a single individual without dependants who earns $3,000 to $12,833 per year, or a family (including couples with or without children, and single parents) that earns $3,000 to $21,167 per year.

If you are a resident of British Columbia, Nunavut, or Quebec, the earned income amounts may vary.

How do I apply for the WITB?

Eligible individuals and families can apply for the WITB on their Income Tax and Benefit Return, or by applying for the WITB advance payment using Form RC201.

How do we calculate the amount of your benefit?

The WITB is based on the amount of income earned in a year from employment and business, without considering any losses claimed in that year. The WITB provides a refundable tax credit equal to 20% of earned income-up to $500 for individuals and $1,000 for families. To target assistance to those with lower incomes, the credit is reduced by 15% of net income for individuals earning more than $9,500 and families earning more than $14,500. If you are a resident of British Columbia, Nunavut, or Quebec, these amounts may vary.

After applying for the WITB, you will receive a notice that explains your benefit amount.

Is an advance payment available?

To maximize the effectiveness of the WITB, an advance payment option is available starting in 2008. Individuals and families who are eligible for the WITB (based on anticipated yearly earned income) may choose to apply for an advance payment of one-half of their estimated WITB. Advance payments will be issued quarterly in April, July, October, and January.

Am I eligible for the disability supplement?

The WITB includes an additional disability supplement for each individual, other than a dependant, who:

• is eligible for the disability tax credit;
• has at least $1,750 in individual earned income; and
• meets the other eligibility requirements for the WITB.

Each dollar of the individual's earned income in excess of $1,750 will be supplemented at a rate of 20%, up to a maximum credit of $250. The disability supplement will be reduced by 15% of net family income in excess of $12,833 for single individuals and $21,167 for families. If you are a resident of British Columbia, Nunavut, or Quebec, these amounts may vary.

What happens if my situation changes?

You must advise the Canada Revenue Agency of any changes your situation that could affect anticipated yearly WITB entitlements, such as if:

• you move;
• your marital status changes;
• you gain a dependant;
• your dependant is no longer in your care;
• you or your spouse or common-law partner is no longer resident in Canada;
• your income or your spouse's or common-law partner's income changes significantly; or
• you become eligible for the disability tax credit.

More information

For more information about the WITB, visit www.cra.gc.ca/witb or call 1-800-959-8281. To order a copy of Form RC201, Working Income Tax Benefit Advance Payment Application for 2008, visit www.cra.gc.ca/forms or call 1-800-959-2221.

Related documents:

• Tax tip: Working Income Tax Benefit

This document is also available for download in PDF format.

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Date modified:

2014-12-03