CRA Emergency Payments: 2 Massive Changes Coming

The Canada Revenue Agency (CRA) launched the Canada Emergency Response Benefit (CERB) as the flagship COVID-19 program by the Canadian government in 2020. CERB became a lifeline for Canadians who lost income due to the pandemic. The program ended on September 27, 2020, and made way for CERB replacements.

The federal government revamped the Employment Insurance (EI) system and introduced the Canada Recovery Benefit (CRB) to transition Canadians still in need of financial aid. With no visible end to the pandemic, despite hopeful developments on the vaccine front, the government announced two major updates for EI and CRB.

Maximum duration

Many CRB recipients are due to exhaust their benefits on March 27, 2021. The government’s announcement to update CRB and EI came right on time. One of the changes introduced by the CRA will be an extension of CRB from the original 26 weeks to 38 weeks. For regular EI benefits, the CRA has extended the period to 50 weeks for claims made between September 27, 2020, and September 25, 2021.

The federal government also extended the Canada Recovery Caregiving Benefit (CRCB) and Canada Recovery Sick Benefit (CRSB). The CRCB duration is also 36 weeks after the update, while the CRSB has been extended from two to four weeks.

CRA cash benefit amount

The CRA pays $1,000 for each two-week CRB eligibility period, which is actually $900 after the 10% withholding tax is deducted at the source. For self-employed individuals who prefer access to their EI benefits through Service Canada, the government has reduced the self-employed income threshold (for 2020 earnings) from $7,555 to $5,000.

You can earn income while you receive CRB, provided that your annual income for the calendar year will not go over $38,000. You will need to pay 50% of each dollar of your income that goes above $38,000.

If you qualify for the EI benefit, the minimum amount you can receive per week is $500 (subject to a 10% tax on payment), but some people may be eligible to receive up to $573 per week, depending on their previous income. The proceeds for both CRSB and CRCB are $450 per week (subject to a 10% withholding tax upon payment).

Source: CRA