What is a climate action incentive payment?

A climate action incentive payment is a tax-free government payment meant to help offset the cost of federal pollution pricing for eligible people and families in Canada. It was originally called the Climate Action Incentive Payment, and the program is now known as the Canada Carbon Rebate.

Quick scoop

• It is paid to eligible households, usually through the tax system.

• Its purpose is to return money to Canadians to help balance the cost of carbon pricing.

• The payment is not something you apply for separately in most cases; eligibility is generally based on your tax return.

Why it exists

The idea is simple: when the federal government charges for carbon pollution, it also sends rebate money back to households in affected provinces and territories. In plain language, it is a “pay in, get some back” system tied to climate policy.

What changed

The old name, Climate Action Incentive Payment, is now commonly referred to as the Canada Carbon Rebate. Some recent sources note that quarterly payments ended in 2025, with later filings still able to claim missed amounts for earlier years.

Who gets it

Eligibility depends on where you live and whether you filed your income tax return. The payment has been available in provinces using the federal carbon pricing system, and some household types may receive higher amounts than others.

Bottom line

If you saw “climate action incentive payment” on your bank statement or in tax-related info, it usually refers to a tax-free federal rebate connected to carbon pricing in Canada.

TL;DR: It’s a Canadian tax-free rebate tied to federal carbon pricing, now generally called the Canada Carbon Rebate.