Tax Credit for Public Transit Passes

Beginning on July 1, 2006, the Government of Canada is offering individuals a non-refundable tax credit to cover the cost of public transit passes. If you have a public transit pass, make sure to read the questions and answers below.

1. What is the tax credit for public transit passes?
2. How do I claim the tax credit for public transit passes?
3. What will I need to support my claim?
4. How much can I claim?
5. I use more than one method of public transit to commute. Can I claim more than one type of pass?
6. Can I claim the credit on behalf of my family?
7. In my area, passes for July are on sale starting mid-June. If I buy my July pass in June, does it mean that I cannot claim it?
8. How do I claim the tax credit for an annual pass for 2007 that I purchased in 2006?
9. How do I claim the tax credit for an annual pass for 2006 purchased in 2005?
10. How do I make a claim for an annual student pass purchased for the 2006-2007 school year?
11. How do I make a claim for an annual student pass purchased for the 2005-2006 school year?
12. Where can I get more information about this tax credit?

1. What is the tax credit for public transit passes?
The tax credit for public transit passes is a non-refundable tax credit for the cost of buying a monthly (or longer duration) pass for commuting on buses, streetcars, subways, commuter trains and local ferries.

2. How do I claim the tax credit for public transit passes?
You will be able to claim the tax credit for public transit passes on your 2006 income tax return for the amounts you have paid for travel that occurs after June 30, 2006.

Top of page

3. What will I need to support my claim?
At a minimum, you will need to keep your expired monthly transit passes for months after June 2006 to support your claim.

If your transit pass displays all of the following information, the pass itself will be sufficient to support a claim for the tax credit:

• an indication that it is a monthly (or longer duration) pass;
• the date or period for which the pass is valid;
• the name of the transit authority or organization issuing the pass;
• the amount paid for the pass; and,
• the identity of the rider.

If the pass does not have all of this information, you will also need to keep receipts, cancelled cheques or credit card statements, along with your pass(es), to support your claim.

You will not need to submit any documentation when you file your return, but you must keep it in case the Canada Revenue Agency (CRA) asks for it in verifying your claim.

4. How much can I claim?
You can claim the full amount paid for a public transit pass, or for the cost of passes for multiple transit systems (see question 5 below).

The tax credit is a non-refundable tax credit, which means that the amount you claim is multiplied by the lowest personal income tax rate for the year (15.25 per cent in 2006) and is then deducted from your tax otherwise payable.

5. I use more than one method of public transit to commute. Can I claim more than one type of pass?
Yes, you can claim the full amount of any combination of transit passes.

6. Can I claim the credit on behalf of my family?
Yes, you can claim the tax credit for public transit passes on behalf of your spouse, common law partner, and your children under the age of 19, to the extent that these amounts have not already been claimed.

Top of page

7. In my area, passes for July are on sale starting mid-June. If I buy my July pass in June, does it mean that I cannot claim it?
No, as long as you keep your receipt and your pass, you can claim amounts you have paid for travel that occurs after June 30, 2006, as would be the case of your July pass, no matter when you purchased it.

8. How do I claim the tax credit for an annual pass for 2007 that I purchased in 2006?
If you paid for your 2007 annual pass in 2006, you will only be able to claim the tax credit on your 2007 tax return, because no portion of the cost of the 2007 annual pass was used for travel in 2006.

9. How do I claim the tax credit for an annual pass for 2006 purchased in 2005?
You will be able to claim the amount paid for your 2006 annual pass purchased in 2005 for travel that occurs after June 30, 2006, on your 2006 tax return.

10. How do I make a claim for an annual student pass purchased for the 2006-2007 school year?
If you paid in 2006 for a student annual pass for months in 2006 and 2007, you can claim the amount paid for the portion of travel that occurs in each taxation year. For the portion used in 2006, you can claim the cost for travel that occurs after June 30, 2006 to December 31, 2006 on your 2006 tax return. You can claim the portion of the cost of travel that occurs in 2007 on your 2007 tax return.

11. How do I make a claim for an annual student pass purchased for the 2005-2006 school year?
If you paid in 2005 for a student annual pass for months in 2005 and 2006, you can claim the amount paid for the portion of travel that occurs after June 30, 2006, on your 2006 tax return.

12. Where can I get more information about this tax credit?
Additional information on how to claim the tax credit for public transit passes will be posted soon on the Canada Revenue Agency Web site at www.cra.gc.ca.