I Need To Pay Back My Benefits!?!?!

This year has changed the way a lot of companies and businesses have run. 8.9 million out of the 38 million Canadian residents have recieved one of the many unique Canada Recovery Benefits. Unfortunately, a lot of Canadians may not know they need to pay back their benefits. Try to remember if you received the Canada Emergency Recovery Benefit (CERB), Canada Emergency Student Benefit (CESB), Canada Recovery Benefit (CRB), Canada Recovery Sickness Benefit (CRSB), or Canada Recovery Caregiver Credit (CRCB) payments. Those who have received one of these benefits will receive a T4A and/or a T4E slip in the mail.

Pay Back My Benefits

A T4A will be provided to persons who received benefits from the Canada Revenue Agency (CRA). A T4E will be provided to persons who received benefits from Service Canada. If you do not receive a T4A/T4E slip and you know you received a benefit, you can view these slips online through your MyCRA account.

Confused or unsure on whether or not you need to repay your benefits?

The CRB, CRSB, and CRCB were all subject to 10% tax withholding at the source. As a result, any taxes that must be repaid on the benefit have already been deducted before it reaches your account. There was no tax withholding on the CERB or CESB benefits. This will result in a higher tax bill at the end of tax season. This means that recipients of the CERB and CESB benefits will need to pay back the taxes of their benefit at the end of the tax year.

In any case where CERB repayment is necessary, the Canadian Government has announced they will not enforce fines or interest. The Canada Revenue Agency will give Canadians more time and flexibility to repay based on their net income. Self-employed individuals who were approved for the CERB will not be compelled to pay back the benefits. This is only provided that the self employed individual met the other eligibility requirements. Some qualifying self employed individuals whose net self employement income was less than $5,000.00 may have already voluntarily repaid the CERB. The CRA and Service Canada will return any repaid amounts to impacted individuals.

The CRA has made note that if you repay the Covid-19 Emergency Benefits before 2023, you can now choose to deduct the amount on your return the year you repaid it or the year you originally received the benefits. This means you have more options to lower the taxes you owe depending on your income for the year.

So, Still Not Sure?

If you are no longer eligible under the CRA’s 4-week eligibility period, CERB repayment is necessary. A similar requirement will apply to those who received EI alongside any Canada Recovery Benefits.

Still aren’t sure if you met the income requirements? Are you are concerned you may need to repay any of the other benefits received? Contact the CRA at 1-800-959-8281. If your CERB payment came from EI/Service Canada, please contact Service Canada at 1-800-622-6232.