Just got an OTB notice and need help figuring out what to do? 

Getting any sort of official notice from the CRA can be intimidating — but luckily, an OTB notice is nothing to worry about. Usually, it's just confirming your entitlement to the Ontario Trillium benefit.

Still trying to understand? Don't worry — in this full guide, we'll cover:

• What is the OTB?
• How are OTB payments delivered?
• Who can qualify for the OTB?
• What to do when you get an OTB notice
• Additional tax credits you should know about

Let's jump into it!

By the way —  if you want to get the best possible loan or line of credit to maximize your financial health, you'll want to get in touch with the home loan professionals here at Lotly. We work with over 30 different lenders in Canada to find the best loans for your situation. Are you a homeowner? Book a free consultation today!

What is the OTB (Ontario trillium benefit)?

The OTB (Ontario Trillium benefit) is a tax-free payment provided by the Government of Ontario to help individuals and families with low to moderate incomes cover their living expenses.

It combines three different benefits:

1. The Ontario Energy and Property Tax Credit.
2. The Northern Ontario Energy Credit.
3. The Ontario Sales Tax Credit.

How are OTB payments delivered?

OTB payments are delivered monthly, usually on the 10th. However, you can choose to receive them as a lump sum. If the total annual entitlement is under $360, they will be deposited as a lump-sum payment regardless.

You will need to update your information with the CRA (Canada Revenue Agency) if there are any changes to your personal details, such as your address or bank account information.

Who can qualify for the OTB?

To qualify for the OTB, you must be a resident of Ontario and meet specific income requirements. The amount you receive will depend on your family size, income level, and whether or not you own or rent your home.

Since the OTB is a combination of three credits, you'll need to meet the eligibility criteria for each:

Ontario property tax credit

To qualify for this credit, at least one of the following must be true. You

• Own or rent a home in Ontario in 2023.
• Have paid property tax or rent on a principal residence in Ontario in 2023.
• Have paid living costs in an Ontario public or non-profit long-term care home in 2023.
• Lived in a designated Ontario university, college, or private school residence in 2023.
• Have paid for home energy costs in Ontario for your principal residence in 2023.

Northern Ontario energy credit

To qualify for this credit, you must:

• Live in Northern Ontario (as defined by the CRA), i.e., rent or own a home here.
• Have paid living costs in a Northern Ontario public or non-profit long-term care home in 2023.
• Have paid for home energy costs in Northern Ontario for your principal residence in 2023.
• Have paid property tax or rent on a principal residence in Northern Ontario in 2023.

Ontario sales tax credit

This credit is for Ontario residents and is based on your family status. No application is needed, as the CRA will automatically calculate this credit based on your 2023 tax return.

What to do when you get an OTB notice

Don't panic! You only receive an OTB notice in two scenarios:

1. A simple confirmation that you're entitled to receive the OTB.
2. You elected to receive a lump sum payment, but the CRA has revoked this decision.

Scenario 1 is nothing to fear. Scenario 2 may seem problematic, but it's also manageable. The CRA will explain why your decision has been revoked and tell you how to proceed:

Lump sum payment is no longer an option

If the CRA revokes your lump sum payment decision, they'll notify you in writing via OTB notice. This can happen when:

• You move out of Ontario.
• You go into bankruptcy.
• Become incarcerated for 90+ days.
• In the event of your passing (your spouse or estate will receive the notice in this case).

Additional tax credits

In addition to the OTB, several other tax credits are available in Ontario to help lower your tax burden and increase your refund. These include:

• Senior homeowners' property tax grant
• First-time home buyers' tax credit

To qualify for these credits, you must meet particular eligibility requirements set by the CRA. It's essential to keep track of all potential credits and their respective deadlines to ensure you receive the maximum benefits available to you.

Tips for making the most of your OTB

Here are some tips to help you make the most of your OTB payments:

• Update your income information regularly: If your income changes, updating the CRA as soon as possible is vital. It will ensure you receive the appropriate amount of OTB based on your current income.
• Keep track of deadlines: The deadline for filing your tax return is April 30th each year. However, if you have a spouse or common-law partner, their return must also be filed by this date to receive any applicable OTB payments.
• File on time: Even if you don't owe any taxes, file your tax return on time so you can receive any applicable OTB payments. Late filing can result in a delay or loss of benefits.
• Keep records: It's crucial to keep all relevant documents and receipts relating to your income and expenses in case the CRA audits you. This will help support your claim for any tax credits, including the OTB.
• Seek professional advice: If you need clarification on your eligibility for the OTB or other tax credits, getting advice from a tax professional may be helpful. They can help you claim all available benefits and maximize your tax savings.

Make the most of your loans with the experts at Lotly

Let's recap everything we've learned so far:

• The Ontario Trillium Benefit (OTB) is a tax-free payment that assists low- to moderate-income individuals and families in Ontario with living expenses. It combines the Ontario Energy and Property Tax Credit, Northern Ontario Energy Credit, and Ontario Sales Tax Credit.
• OTB payments are delivered monthly, usually on the 10th, or as a lump sum if the total annual amount is under $360, with updates to personal details required through the CRA.
• An OTB notice confirms your entitlement to the benefit or indicates that a lump sum payment option has been revoked, explaining the reasons and, if applicable, the next steps.

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Frequently Asked Questions (FAQs)

Can I still apply for the OTB if my income changes throughout the year?

Yes, you can apply for the OTB if your income changes throughout the year. However, keep in mind that your eligibility and benefit amount may change depending on your updated income.

When will I receive my OTB payment?

OTB payments are issued on the 10th of each month. For 2024, the CRA will begin issuing payments on July 10, continuing on the 10th of each month thereafter.

Can I claim both the OTB and other tax credits?

Yes, you can claim both the OTB and other tax credits as long as you meet the eligibility requirements for each credit. Keep track of all potential credits and their respective deadlines to ensure you receive the maximum benefits available to you.

Do I need to report my OTB payments as income?

No, OTB payments are not considered taxable income and do not need to be reported on your tax return. However, it's always best to consult with a tax professional if you have any questions or concerns about reporting your income and benefits.

What should I do if I haven't received my OTB payment?

If you have not received your OTB payment by the 15th of the month, contact the CRA to inquire about its status. You may also need to update your personal information or adjust your benefit amount to receive future payments on time.

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