Government Extends CRB and Other Pandemic Benefits

Evelyn Jacks & Beth Graddon

The federal government has extended pandemic support benefits, in the midst of a reopening of the economy; many believe in advance of a federal election announcement expected soon.  However, the benefits have significant changes in them.  This report provides an overview of the CRB, the Canada Recovery Benefit changes.

The CRB originally provided $500 per week for up to 42 (originally 26) weeks, but under the new extension, this is now a maximum of 54 weeks:  from September 27, 2020 to October 23, 2021. This is a total maximum of 27 periods.

The benefits are paid every two weeks to eligible employees and those who are self-employed or are not eligible for EI and still require income support because their income has dropped, or they have not returned to work due to COVID-19. Recipients must be available and looking for work, however. 

In addition, to qualify, applicants must be:

• At least 15 years old and have a valid SIN
• Not eligible for regular EI benefits, Canada Recovery Sickness Benefit (CRSB), Canada Recovery Caregiving Benefit (CRCB), short-term disability benefits, Québec Parental Insurance Plan (QPIP) benefits
• Did not quit their job voluntarily
• Have stopped working or suffered a reduction in earnings due to COVID-19
• Earned at least $5,000 in employment or self-employment income in 2019 or 2020
• Average weekly employment or net self-employment income must be less than 50% of average weekly income in 2019, 2020 or the last 12 months.This is calculated as follows:
  • For claim periods in 2020 – use either 2019 or the previous 12 months
  • For claim periods in 2021 -use 2019, 2020 or the previous 12 months

Tax withholding, clawbacks and tax filing requirements.  Recipients will have 10% taxes withheld from benefits of either $1000 ($900 net of taxes) or $600 ($540 net of taxes). 

In addition, recipients who have a net income of $38,000 or more will be required to repay the lesser of 50% of their net income over $38,000 and the total of the benefits received when they file their tax returns. 

Note that tax filing for the 2019, 2020 tax years is required to receive these benefits, although there is an exception.  Filing these returns are not required if recipients applied for less than 21 period since September 27, 2020 and recipients applied for period 21 or prior periods.   CRB benefits are shown in Box 202 of the T4A slip and reported on line 13000. 

Attend the September 23 CE Summits, where we’ll be discussing recent government tax changes and audit requirements. If you register by August 17, you’ll receive lunch included complimentary you’re your enrolment fee.