immigration News Immigration Updates Team January 26, 2026

Federal government announces new grocery and essentials benefit

The Government of Canada has unveiled a new refundable tax credit that will provide additional financial support to eligible residents, including many newcomers. The measure, called the Canada Groceries and Essentials Benefit, replaces the existing Goods and Services Tax (GST) credit.

Announced on January 26, 2026, the initiative introduces both a temporary and a long-term increase to the federal benefit, aiming to assist lower- and modest-income households with everyday living costs.

One-time 50% boost to the existing credit for 2026
25% permanent increase starting July 2026 for five years
Single individuals can receive up to $950 in 2026
Families of four may receive up to $1,890 this year
Eligibility based on income thresholds and tax residency
Applies to residents aged 19 and over, including newcomers

Overview of the new benefit

The Canada Groceries and Essentials Benefit is designed to offset the impact of sales taxes on essential goods. It continues the purpose of the former GST credit but with expanded payment amounts. The program introduces a one-time 50% top-up for 2026, followed by a 25% increase to the annual benefit until 2031.

According to government figures, an eligible single individual will see their maximum annual benefit rise to $950 in 2026, compared to $533 previously. For a family of four, the maximum total payment will reach $1,890 this year and $1,400 per year for the following five years.

Eligibility and payment structure

The benefit will be available to Canadian residents aged 19 or older who meet income requirements. Eligibility is determined using net income levels, which vary by family size and marital status. For the 2024 tax year, the threshold for a single person without children is $56,181.

To qualify for payments beginning in July 2026, individuals must have filed a 2025 tax return. The Canada Revenue Agency is expected to issue payments quarterly starting that month. Newcomers who become tax residents after the last filing season can apply by submitting Form RC151 for the year they became residents.

Impact on newcomers and temporary residents

The government anticipates that a significant portion of beneficiaries will be newcomers, as many fall within the lower income brackets used to calculate eligibility. This group includes international students, temporary foreign workers, and newly landed permanent residents.

Newcomers in provinces such as Manitoba—where immigration pathways like the Manitoba Provincial Nominee Program (MPNP) attract large numbers of new residents—are expected to be among those who qualify for the expanded credit.

Background and policy context

The measure revamps the long-standing GST credit, a program that has historically provided quarterly payments to help lower-income taxpayers offset sales taxes on goods and services. The rebranding to the Canada Groceries and Essentials Benefit reflects an effort to align federal support with current cost-of-living challenges faced across Canada.

Federal data indicate that individuals with lower incomes spend a greater proportion of earnings on necessities such as food and household goods. The enhanced benefit seeks to maintain purchasing power amid continued inflationary pressure on essential items.

Implementation timeline

The one-time increase will apply in 2026, with the ongoing 25% enhancement taking effect in July of the same year. Payments will continue quarterly for five years, through mid-2031. The government has not announced further changes beyond that period.

Public relevance

The updated credit is expected to reach millions of residents across Canada, providing extra financial relief to households that qualify. The inclusion of newcomers underlines the government’s recognition of their economic vulnerability during initial settlement years.

As with the previous GST credit, the new benefit will be automatically calculated based on income tax returns, ensuring that eligible taxpayers receive payments without a separate application process.

Further announcements are anticipated as the program’s administrative details are finalized ahead of the July 2026 rollout. Updated information will be provided by federal authorities as implementation nears.

For continued updates on federal and provincial immigration measures, including settlement supports and tax policy changes, explore related coverage on Canadian immigration programs and benefits.