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In the Know…A Blog

CRB & 3 New Benefits are Introduced

Oct 6, 2020 | CRA News, Payroll & benefits

Bill C-4 passed in the House of Commons Wednesday, September 30th with unanimous approval.

The Canadian Emergency Response Benefit (CERB) is no longer available as of September 26th is now replaced by the Canada Response Benefit (CRB). The CRB will support Canadians who do not qualify for EI benefits and/or are self-employed. Accompanying the CRB are 2 other benefits, the Canada Recovery Caregiving Benefit (CRCB), and the Canada Recovery Sickness Benefit (CRSB).

The Canadian Response Benefit (CRB) will provide up to $1000 every 2 weeks, not including taxes being withheld which is $100. Similar to Employment Insurance (EI), Canadians will have to apply every 2 weeks if their situation or lack of work continues. The benefit can be applied for up to a total of 13 eligibility periods (26 weeks) from September 27, 2020, to September 25, 2021.

To be eligible for the CRB, you must have not worked in the period you are applying for. Or you had a 50% reduction in your average weekly income compared to 2019. Both situations need to be due to Covid-19. Applicants must not have voluntarily quit their jobs or reduced their hours.

Canadians can work while receiving the CRB but be aware that the income threshold for the CRB is $38,000. If in 2020 your net income (not including the CRB) is over $38,000 you will be required to pay back $0.50 of every dollar you are over the threshold to the maximum amount of the benefit you have received.

What is the Canada Recovery Caregiving benefit (CRCB)?

The CRSB is available for Canadians who are employed or self-employed but cannot work because they are caring for a child under 12 or a family member who needs supervised care. And/or if the child or family member is sick, self-isolating, or at risk of serious health complications due to Covid-19.

The benefit is applied for on the CRA website through My Account on a weekly basis for a total of 26 weeks between September 27, 2020, to September 25, 2021. The weekly benefit is up to $500 per week minus $50 tax ($450).

If you are unable to work at least 50% of your scheduled work week because you are caring for a child under 12 or a family member, you are eligible for the benefit. Care for a child under 12 includes their school or facility is closed due to Covid-19. And care for a family member includes them being sick with or having symptoms of Covid-19, is self-isolating, and has been advised by their doctor that they are at serious risk of Covid-19. There is a helpful definition on CRA’s website that states who can advise someone to stay home. They include a medical practitioner, A nurse, a person in authority, the government, and your public health authority.

And finally, what is the Canada Recovery Sickness Benefit (CRSB)?

The CRSB is for people that are unable to work because they are self-isolating or sick with Covid-19. Or have health conditions that put them at greater risk of contracting Covid-19.

The benefit is for 1 week and is the same as the Canadian Recovery benefit at up to $500 per week minus $50 tax ($450). It also runs for September 27, 2020 through September 25, 2021 CRA My Account porthole. You may apply up to 2 weeks if needed.
The eligibility is that Canadians need to be sick, self-isolating, or at health risk due to Covid-19. And are unable to work at least 50% of their work schedule. You Must not be receiving employer paid leave for the same period.

Other requirements for all 3 benefits are: you reside in Canada, are at least 15 years old, have a valid Social Insurance Number (SIN), and earned at least $5,000 (before deductions) in 2019 from self-employment, employment income, maternity, or parental benefits. You can only apply for one of these benefits, but not received short-term disability, WCB benefits, or employment insurance. CERB and EI benefits do not count as income in regards to qualifying for the CRB, only the above mentioned types of income qualify.

The main difference between the CERB and the CRD is it will allow workers to earn more employment income on the CRD. On the CRB workers can earn employment income up to $3166.66 per month without going over the $38,000 threshold. On the CERB a worker could only earn $1000 per month. Another difference is that like employment insurance, the CRD is received after a 2 week loss of income-not at the beginning like the CERB. This means that those switching from the CERB to the CRD on September 27, 2020 will receive their first payment about October 11.

The Canada Revenue Agency also has directions for returning one of these benefits if you received it in error or were not eligible.

In February 2021 CRA will send out T4s for these 3 benefits which will show withholding tax. For CERB payments Canadians will be issued a T4A of which they will have to declare taxes for 2020.

You can find out more on all 3 benefits on the Canada Revenue Agency’s website. As of October 5th, Canadians can apply for these benefits through your CRA My Account porthole.


Barb Watkis

Barb Watkis

Author

I’m a bookkeeping technology geek who has been in this industry for over 20 years. My specialty is helping small business streamline their workload with paperless business systems. I have also worked as a purchaser for a tech company and a controller for several businesses. Currently I am QuickBooks Advanced Certified.
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