The Ontario Trillium Benefit (OTB) is a monthly benefit payment issued to eligible lower-income families and taxpayers living in Ontario. If you’ve recently applied for OTB or have been receiving regular OTB payments, then you may receive an OTB notice.
An OTB notice is just a notification from the CRA regarding your benefits. The notice may inform you that you’ve been approved for benefits, need to pay back a certain amount, or explain an increase or decrease to your benefit payments.
Below, I’ll outline some of the main reasons why you may receive an OTB notice and answer some other commonly asked questions regarding OTB eligibility, application, and benefit payments.
If you’ve recently applied for the Ontario Trillium Benefit, then you may receive an OTB notice in the mail regarding your application status and explaining whether you’ve been approved or denied for benefits.
On the other hand, if you’re already receiving OTB payments, then the OTB notice was likely sent out to inform you of changes to your account or the OTB program as a whole.
In some cases, a mailed OTB notice may not include many details. Instead, the notice may require you to log into your CRA MyAccount to view more information. This ensures that your information remains private. However, these notices can be a bit nerve-racking, especially if you don’t know what to expect.
Some of the main reasons why Ontario taxpayers may receive an OTB notice include:
- Notice that your OTB application is being processed
- Notice that your OTB application has been accepted or denied
- Notice that you owe money back to the CRA (OTB clawback)
- Notice of changes to OTB benefit payments
- Notice of increased or decreased OTB payments based on your status
If you receive an OTB notice, you should open the letter immediately to figure out what it is. Trust me when I say that this isn’t something you want to procrastinate on. The notice may ask you to call in and speak with an agent or may ask you to log into your CRA MyAccount for more details.
The best-case scenario is that it’s just a routine notice. However, if you owe money back, it’s important to resolve the issue as quickly as possible to avoid penalties from the CRA.
OTB payments are only issued to eligible Ontario residents. Eligibility for OTB benefits depends heavily on your income, along with other factors, such as:
- The part of the province you live in
- Any children or dependents living with you
When any of these factors change, your OTB payments could be affected. For instance, the Northern Ontario Energy Credit is only available to Canadians living in the northernmost region of Ontario. If you move south, then your benefit will be adjusted to account for this.
Often, there is a delay between changes to your living situation and your benefit payments. This, in turn, could result in you receiving an OTB notice claiming that you owe money back to the CRA.
If you’re required to pay back OTB payments to the CRA, you’ll generally have three different options to do so:
- Pay online with your CRA MyAccount
- Pay the CRA through your bank’s online banking system
- Mail a cheque or money order to the CRA
If for any reason, you’re unable to pay the CRA, then the amount that you owe will be automatically deducted from your tax refund payment.
If your refund amount isn’t enough to cover the full amount that you owe, then your refund will be applied to the debt, and you’ll be sent another OTB notice outlining your updated balance.
The Ontario Trillium Benefit is not an automatic payment like other tax rebates. Instead, you must apply directly for it (see instructions below). Because of this, many Ontario residents are unaware that they’re eligible for benefits and simply neglect to apply.
Thankfully, eligible OTB recipients can receive back pay from the CRA.
If you believe that you were eligible to receive OTB payments for previous years, then you can apply for a reassessment using the CRA form T1-ADJ, which is used to make adjustments to your OTB benefit return.
The CRA will review your request and use your previous years’ tax returns to determine the amount that you’re eligible to receive. If your request is approved, then the amount should be issued as a single lump sum payment.
Throughout the province’s history, Ontario has offered various benefits, tax credits, and social welfare assistance to eligible residents. In 2012, though, the CRA made the move to simplify things by combining three of Ontario’s top benefits into a single monthly payment amount:
- Ontario Energy & Property Tax Credit
- Ontario Sales Tax Credit
- Northern Ontario Energy Credit
These three benefits were combined into what is now called the Ontario Trillium Benefit. OTB payments are reserved for lower-income taxpayers and families and are designed to provide financial assistance in the form of a monthly payment that’s issued on the 10th of each month.
Here’s a quick breakdown of each benefit, so you can better understand any OTB notice you may receive.
The Ontario Energy and Property Tax Credit (OEPTC) is a benefit that reimburses eligible OTB recipients for money that they’ve paid toward property taxes, energy sales taxes, and other living expenses.
The maximum OEPTC credit is $1,095 for Ontario residents between 18 and 64. Those who are 65 or older may receive up to $1,247.
The actual amount you’ll receive depends on eligibility factors and also accounts for the amount of property and energy taxes that you paid during the previous tax year.
Ontario’s Harmonized Sales Tax (HST) combines both the provincial 8% sales tax with the federal government’s 5% sales tax for a total HST of 13%. Eligible Ontario residents can get relief on the provincial portion of the sales tax in the form of the Ontario Sales Tax Credit (OSTC).
OTB recipients may receive up to $316 for themselves, as well as an additional $316 for their spouse and each dependent child under 19 years old who’s still living in the home.
Northern Ontario is cold, to say the least. Of course, the harsh winters come with increased energy costs.
The Northern Ontario Energy Credit is an additional OTB benefit that’s issued to eligible recipients living in the northern region of Ontario, and is designed to help offset the additional energy costs. It’s paid alongside the OEPTC that I mentioned above.
To receive the NOEC, you must live in one of the following regions of Northern Ontario:
- Parry Sound
- Rainy River
- Thunder Bay
If you’re an OTB recipient living in one of these regions, then you can expect to receive both the NOEC and OEPTC. If you’re an OTB recipient living outside of these regions, then you’ll only be eligible to receive the OEPTC.
Wondering how to apply for your OTB benefits? Here’s a quick step-by-step guide. The application process is relatively simple and straightforward, so there’s no excuse why you shouldn’t try, as long as you meet the eligibility requirements.
Your OTB payment is calculated based on the information that you provided in your previous year’s tax return. If you want to receive OTB benefits, you’ll need to file your tax return. If you’re applying for back payments for previous years, then you’ll need to complete the CRA form T1-ADJ and submit it to the CRA.
Before you submit your tax returns, you’ll need to complete the ON-BEN form, which serves as the application for OTB payments. You’ll submit the completed ON-BEN form with your tax returns.
Within a few weeks of filing your tax returns and applying for OTB, you should receive an OTB notice from the CRA explaining whether or not your application has been approved, denied, or if more information is needed to finalize your application.
To wrap up, let’s go over a few quick FAQs related to OTB notices.
Your total OTB benefit is added together and divided into twelve monthly payments. OTB benefits are typically issued on the 10th of each month, which makes it easier to plan into your budget.
If you owe taxes to the CRA, then the amount will be deducted from your OTB benefit payment until you have paid your debt to the CRA in full. Once your debt is paid, you’ll begin receiving regular payments on the 10th of the month, as usual.
OTB benefits are typically paid via direct deposit, which you can register for using your CRA MyAccount.
Ontario taxpayers may receive an OTB notice for a number of different reasons. If you’ve recently received a notice, then I recommend being proactive and taking care of it as soon as possible.
If the OTB notice is just informing you of a routine update, though, then there’s nothing to worry about.
Want to learn more about OTB benefits, eligibility, and how to apply for them? Keep on reading to see my ultimate guide to the Ontario Trillium Benefit!