OCHU-CUPE: Understanding the New PSW Federal Tax Credit

The federal government just announced a new tax credit for eligible personal support workers (PSWs). PSWs are healthcare professionals who provide essential
care and support, assisting individuals with the activities of daily living. PSWs do critical work, and they deserve fair compensation for it. This tax credit is a
step in the right direction. It will provide eligible members with some relief, but it’s only temporary, and not a proper substitute for living wages.

CUPE will continue pushing to get real, permanent wage increases for PSWs – but in the meantime, here’s what we know about the new tax credit.

How does it work?
·       The credit is temporary, it will be available for 5 years, from 2025 to 2030.
·       Eligible workers can claim up to 5% of their eligible earnings, to a max of $1,100 per year.
·       It’s a refundable tax credit – so you can still get the money even if you don’t owe anything when you file your taxes.
·       Your employer(s) must confirm your eligibility and how much you can claim. They’ll do this by submitting a specific form to the Canada Revenue Agency (CRA)

Who is eligible?
·       Be a health care worker who “ordinarily provides one-on-one care and essential support to optimise and maintain another individual’s health, well-being, safety, autonomy, and comfort”.
·       Provide care as “as directed by a regulated health care professional or a provincial community health organization”.
·       Have main duties that include “helping patients with activities of daily living and mobilization”.
·       Work for a hospital, nursing or residential care facility, community care facility for the elderly, a home health care establishment, or “other similar regulated health care establishments”.
·       Have filed your taxes.

Does it count if I have the same/a similar job with a different title?
Yes, if you meet the other criteria above. As long as your job duties meet the definition provided, and your employer confirms your eligible earnings, you should be able to claim this credit.

What are “eligible earnings”?
·       Taxable employment income (wages, salaries, benefits, overtime pay, shift premiums, etc.) earned working at an eligible health care establishment, certified by your employer.
·       Also includes taxable benefits specifically related to your employment as a PSW, and any similar tax-exempt income you may have earned on a reserve.
·       You cannot count any income you made from:
o   non-PSW jobs
o   unregulated facilities
o   private, cash-based care without a “proper employment structure”
o   self-employment that’s not tied to regulated PSW duties
o   working as a PSW or related occupation in BC, Newfoundland and Labrador, or the Northwest Territories

Quick math: if you made $18,000 in eligible earnings, you could receive a $900 tax credit; if you made $22,000 or more, you could receive the maximum of $1,100.

*Info courtesy the OCHU-CUPE newsletter