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What to Do with Your Tax Refund: 5 Smart Moves for Canadians

  Tax Season · Personal Finance By MoneySavings.ca Editorial Team • May 7, 2026 • 7 min read Tax season is wrapping up across Canada, and for millions of Canadians, that means a refund cheque — or a direct deposit — is on its way. The average Canadian tax refund hovers around $1,800. That's real money. The question is: what's the smartest thing you can do with it? It's tempting to treat a tax refund like "found money" and splurge. But here's the truth — that refund was your money all along. The government was just holding it for you, interest-free. So before it quietly disappears into day-to-day spending, let's look at five moves that will make it work harder for you. $1,800 The average Canadian tax refund — enough to make a meaningful dent in debt, pad an emergency fund, or kick-start your TFSA for the year. 1 Pay Down High-Interest Debt First If you're carrying a balance on a credit card, this should be your very first call. Most Canadian credit car...
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Canada Groceries & Essentials Benefit Is Getting a 25% Boost

 

If you've been feeling the pinch every time you push a cart down a grocery store aisle, you're far from alone. Beef prices climbed 17% in 2025, lettuce jumped 15%, and coffee surged 30%. Now, the federal government is stepping in with one of the biggest benefit boosts in years — and the money starts flowing on June 5, 2026.

The Canada Groceries and Essentials Benefit (CGEB) replaces the GST/HST credit starting July 2026, with quarterly payments increased by 25% for five years — plus a one-time top-up equal to 50% of last year's credit landing on June 5, 2026.

What exactly is the Canada Groceries & Essentials Benefit?

The CGEB is the federal government's rebranded and supercharged version of the GST/HST credit you may already be receiving. Announced by Prime Minister Carney and passed into law via Bill C-19 on February 12, 2026, it keeps all the same eligibility rules and income testing — the only thing that changes is the amount you receive, which is going up significantly.

25%Quarterly boost for 5 years
$1,890Max for a family of four in 2026
$950Max for a single person in 2026
12M+Canadians receiving the benefit

The two-part payment plan

There are two distinct payments to keep track of:

1. One-time top-up (June 5, 2026) — This is a lump-sum payment equal to 50% of your 2025–26 GST/HST credit. It arrives in one shot and is based on your eligibility as of January 2026. A single person earning $25,000 net income will receive $267; a couple with two kids earning $40,000 gets $533.

2. Ongoing 25% quarterly increase (starting July 3, 2026) — Every quarterly payment going forward will be 25% higher than the old GST/HST credit for five years, running through to 2031. The first enhanced payment arrives July 3, 2026, based on your 2025 tax return.

Combined, a single senior with $25,000 net income receives an extra $402 in total for the 2026–27 benefit year. A couple with two children and $40,000 net income gets an extra $805 this year alone.

Who qualifies?

Eligibility mirrors the old GST/HST credit — meaning if you were already getting that credit, you're automatically in. The CGEB is income-tested and targets low- to modest-income Canadians. Over 12 million Canadians currently qualify, and the 25% increase is expected to bring in an additional 500,000 individuals and families who previously didn't qualify due to income thresholds.

Do you need to apply?

In almost every case, no. The CRA will calculate your entitlement and send payments automatically. The only exception is new residents of Canada, who may need to submit Form RC151. The most important thing you can do right now is file your 2025 tax return — your July 2026 payments will be based on it.

You should also make sure your direct deposit information is up to date in your CRA My Account so the June 5 top-up lands directly in your bank account rather than arriving as a slower paper cheque.

How much will you actually get?

Your exact amount depends on your adjusted family net income, your marital status, and the number of children under 19 in your household. The CRA calculates it all automatically from your tax return. For a rough idea, here's what representative households can expect for the full 2026–27 benefit year (including the June 5 top-up):

$950Single person, $25K income
$1,890Couple + 2 kids, $40K income
$8.6BAdditional support over 5 years
$11.7BTotal program value over 6 years

What's the bigger picture?

The CGEB is part of a broader government affordability push. Alongside the benefit increases, Ottawa has also made the National School Food Program permanent (saving families with two school-age kids an estimated $800 per year in groceries), set aside $500 million to help businesses absorb supply chain disruption costs, and committed $20 million to food banks through the Local Food Infrastructure Fund.

The government has also introduced immediate expensing for greenhouse buildings to lower domestic food production costs — a longer-term play to ease grocery prices at the source, not just at the checkout.

Quick action checklist

Here's exactly what to do before the money arrives:

  • File your 2025 tax return — this determines your July 2026 and ongoing payment amounts.
  • Set up or confirm direct deposit in your CRA My Account for faster delivery.
  • Update your address and family status in CRA My Account if anything has changed.
  • Check your CRA My Account after June 5 to confirm the top-up was received.
  • New to Canada? Submit Form RC151 to apply for CGEB eligibility.

Questions about your payment amount or CRA My Account? Visit the official CRA page for full details and your personal benefit estimate.

canada.ca — Canada Groceries and Essentials Benefit ↗
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