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On August 8, 2025, the Canadian Armed Forces (CAF) announced new pay and benefits to better support members. The changes will occur in phases, with the first phase announced in early October 2025. Phase three introduces new initiatives including Environmental Allowances, and the Domestic Operations and Arctic Allowances.

Environmental Allowances

Given the increased need to maintain a ready force for both domestic and international deployments, the CAF is modernizing several environmental allowances. These allowances support members working in conditions that are more physically demanding or hazardous than normal military duties. They are designed to compensate members only when they are exposed to these difficult environments.

The CAF will cease monthly environmental allowances on March 31, 2026. Starting April 1, 2026, these allowances will be paid as a daily flat rate of $100 for every full 24‑hour period a member spends at sea or in the field. Paratroop and Dive Allowances will also change so that members are paid per jump or per dive. As part of the update, the Submarine Allowance will merge with the Sea Duty Allowance, while the Aircrew Allowance will stay the same.

These changes ensure that allowances reflect the time a member spends in hazardous or demanding conditions, and that they are not paid when those conditions do not apply.

Domestic Operations and Arctic Allowances

The CAF is introducing new allowances to support members involved in domestic emergency response operations, as well as operations in Canada’s North. In addition to any environmental allowances members already qualify for, members deployed on a named domestic operation, such as wildfire response, flooding, a pandemic, or another emergency, will receive $45 per day. The Domestic Operations allowance applies when the duties take place in Canada, under the Chief of the Defence Staff, and when the member stays at the designated post for at least 24 continuous hours. Aircrew will qualify only if they remain at the post for the full period.

The Arctic Allowance provides extra compensation to members who are already receiving Land Duty Allowance (LDA) or Sea Duty Allowance (SDA) while performing duties involving exposure to austere Arctic conditions. When members are physically present in the Arctic for at least 24 continuous hours, they will receive an additional 50% of their LDA, or 25% of their SDA. Aircrew must meet the same requirements to qualify. Receiving Aircrew Allowance alone does not make a member eligible.