Canada Workers Benefit

The Canada Workers Benefit (CWB) is a refundable tax credit that is intended to supplement the earnings of low and modest income workers and improve their work incentives. The credit grows with working income (including employment and self-employment income) over $3,000 and is phased out based on the adjusted family net income of the taxpayer or couple.

For 2021 and later tax years, the budget proposes to enhance the CWB. This enhancement will make the CWB available to taxpayers with a higher adjusted family net income.

The budget also proposes to introduce a “secondary earner exemption” to the CWB. This is a special rule for individuals with an eligible spouse where the spouse or common-law partner with the lower working income excludes up to $14,000 of their working income in the calculation of their adjusted net income, for the purpose of the CWB phase-out. 

Note 

Currently, Alberta, Quebec and Nunavut have agreements that reconfigure the CWB for their residents. For 2021 and later tax years, the basic CWB and CWB disability supplement may differ for residents of provinces or territories that sign reconfiguration agreements with the federal government to make specific changes to the design of the benefit.

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