Canadians Can Get Up To $5K From The Feds To Buy A More Environmentally Friendly Car

Canada is planning to ban the sale of all gas-powered cars.👇🚙

An electric car charging. Right: An electric car charger.
Senior Editor

An electric car charging. Right: An electric car charger.

If you've been thinking about buying a more environmentally friendly car, the Government of Canada's Incentives for Zero-Emission Vehicles (iZEV) program may be able to help pay for it.

The federal program offers Canadians up to $5,000 to buy or lease a Zero-Emission Vehicle (ZEV), in order to help make clean technology "more affordable."

What is the iZEV program?

Launched back in 2019, the iZEV was designed to encourage Canadians to purchase greener vehicles.

It offers a point-of-sale incentive of $5,000 (which can be used alongside similar provincial and territorial programs) to people who buy or lease a qualifying Zero-Emission Vehicle.

It's a program worth keeping in mind, as from 2035 all new cars and light-duty trucks sold in Canada will be zero-emission vehicles and it will no longer be possible to buy new cars that run only on gasoline.

Which cars qualify for it?

Per the government's own criteria, "ZEVs are vehicles that can be driven without producing polluting exhaust." This includes fully battery electric, plug-in hybrid electric and hydrogen fuel cell electric vehicles.

The program has two tiers. Battery electric, hydrogen fuel cell, and longer-range plug-in hybrid vehicles are eligible for an incentive of $5,000, while shorter-range plug-in hybrid electric vehicles are eligible for $2,500.

The retail price of the vehicle must be under $45,000 (although there are some exceptions based on a car's seat capacity and "higher priced" alternatives).

In order to be eligible, the car must also be brand new, as pre-owned vehicles do not qualify for the incentives.

The government-approved list of qualifying vehicles can be found here.

How do I get it?

The incentive is applied at the point-of-sale by the dealership. The discount will appear directly on the vehicle's bill of sale or the lease agreement.

"The dealer must apply taxes and fees to the purchase or lease before applying the incentive," the iZEV web page explains. It will be the dealership's responsibility to submit documentation to be reimbursed for the incentive provided to customers.

Is there anything else?

To maximize the price reduction, this federal incentive can be applied in addition to similar programs offered on a provincial or territorial level.

In some regions, like New Brunswick, drivers will be able to get as much as $10,000 off an eligible vehicle's price tag by combining both federal and provincial programs.

If you really want to get your green on, the feds are also offering $5,000, via the Canada Greener Homes Grant, for making energy-saving improvements to their properties, such as heater upgrades, solar panels, window and door replacements and more.

Helena Hanson
Senior Editor
Helena Hanson is a Senior Editor for Narcity Media, leading the Travel and Money teams. She previously lived in Ottawa, but is now based in the U.K.