The world economy is in a crisis due to the COVID-19 pandemic. As we suffer job losses, pay cuts, and other financial crisis, the Federal Government has announced various financial benefits and relief measures to deal with the situation at hand. We will help you find which category of financial benefits you are entitled to, and how you can avail them.
I. Employment Insurance
If you are an employee who has insurable employment, you are entitled to EI benefits in case of layoffs, job losses, or less income due to reduced hours of work.
Computation of EI benefits: The EI benefits can be calculated by taking 55% of your average insurable weekly earnings as the base rate, up to the maximum amount. This amount stands at a maximum of $573 per week, after deducting taxes or $ 54, 2000 per year as of January 1, 2020.
Who can avail EI benefits? Employees with insurable employment who may have lost their job or those who have shortage of work and have not been paid for 7 continuous days in past 52 weeks can avail these benefits. Furthermore, if such employees have fulfilled their work duties in the required insurable employment hours in past 52 weeks, and are fit to work every day, and are looking to work, they are eligible for EI benefits. They will however need to have written proof of the employers they have contacted and the dates on which these employers were contacted. Additionally, the waiting period of one week to avail EI sickness benefits will be waived for the quarantined folks and they will be paid for the first week upon filing the claim. The quarantined people claiming EI sickness benefits will be relieved from providing a medical certificate to process their application.
You can apply for EI benefits here: https://www.canada.ca/en/services/benefits/ei/ei-sickness/apply.html
II. Canada Emergency Response Benefit Act (CERB)
CERB has replaced the earlier announced Emergency Care Benefit and Emergency Support Benefit. Those not eligible for EI can avail benefits under CERB. However, those eligible for both may choose only one of them. CERB entitles the beneficiaries to get $2000 per month (taxable) for up to a period of four months.
Who can avail CERB benefits? CERB benefits are extended to those who cannot avail benefits under EI such as contract workers, self-employed individuals, and wage-earners. People who are still in employment but have shortage of work and have not been paid or have been asked by their employer not to attend work can avail CERB benefits too. People who are taking care of someone with COVID or are themselves quarantined or suffering from COVID can avail benefits under CERB. The benefits also extend to working parents who have to take leave without pay to stay at home to take care of their wards who have been home-bound due to closure of schools. Persons who have had to halt work without any paid leaves or any means of earning an income are eligible too.
What you must know: The second eligibility period for applying for CERB benefits began on April 13. CERB benefits are paid after every four weeks and one is likely to get the first payment within 10 days of their CERB application.
You can apply for CERB benefits here: https://www.canada.ca/en/revenue-agency/services/benefits/apply-for-cerb-with-cra.html#start
III. Canada Child Benefit (CCB)
The Government has increased the tax-free amount extended to families to help them with the cost born towards raising children.
Who can avail CCB benefits? If you are parents or individuals with a child or children under 18 years of age and are primarily responsible for taking care of the child, you are entitled to CCB benefits. You must be a Canadian resident for taxation purposes. You or your spouse or common-law partner must be either a Canadian citizen, or a permanent resident, or a protected person, or a temporary resident of Canada who has been living in Canada for the past 18 months with a valid permit in the next month as well. You are also entitled to CCB if your child starts to live with someone else or returns to live with you after spending a temporary period of living with someone else. CCB benefits are also extended to those who begin, end or alter an agreement for the shared custody of a child.
Computation of CCB benefits: The maximum annual amount which can be paid under CCB has been raised by $300 per child for the year 2019-20. Families which get CCB will witness an overall increase of $550 on an average. They will get an additional $300 per child for the amount payable in May.
You can apply for CCB benefits here: https://www.canada.ca/en/revenue-agency/services/child-family-benefits/canada-child-benefit-overview/canada-child-benefit-apply.html
IV. Special Goods and Services Tax Credit Payment
The Government of Canada will give a one-time payment through the Goods and Services Tax (GSTC) credit to families with low and modest incomes due to the COVID-19 pandemic.
Who can avail benefits?
You must be a Canadian resident for taxation purposes on the month before and the start of the month in which CRA makes the payment. You should be 19 years old, and you should have or have had a spouse or common-law partner, and are or were a parent who lives or lived with their child to be eligible for this payment.
How will you get the payment: If you receive the GST/HST credit under normal circumstances, you will automatically receive payment. This payment will either be mailed to you or if you are enrolled for a direct deposit, then it will be deposited in your account. You don’t need to make any special application for the same, whatsoever.
V. Additional Federal Support Measures and Provincial Programs
To extend help to groups of people who are vulnerable to COVID-19, the Federal Government has proposed targeted help in the following ways:
Temporary Wage Subsidy: To prevent lay-offs and to help businesses incurring losses, the government has proposed a temporary wage subsidy for three months to eligible small employers. This amount will be 10% of the wages paid during that time. The maximum subsidy will be $25,000 per eligible employer and $1,375 per eligible employee.
Minimum withdrawals from Registered Retirement Income Funds (RRIFs): To help seniors, the required minimum withdrawals under RRIFs should be reduced by 25% in the year 2020. It will address the concern that seniors may have to liquidate the RRIFs for complying with minimum withdrawal requirements.
Business Loans: For the coming four weeks, the CRA will not be in touch with small or medium (SME) businesses for post assessment GST/HST or Income Tax audits. The CRA will also will temporarily suspend audit meetings with taxpayers or their representatives for most businesses.
Personal income tax: In addition, personal income tax filing deadline has been extended from June 1, 2020, to August 31, 2020.
Childcare Subsidy in Ontario: The Ontario government has announced one-time payments to those parents whose children are affected by closure of school and daycare. These payments will amount to $200 per child who is up to the age of 12, and $250 if the child has special needs. Application process for the same will be released soon.
Deferral Dates for the following
Student loans: Placement of a six-month moratorium (interest-free) for repayment of Canada Student Loans for those who are currently repaying them. This has been in effect from March 30, 2020.
Mortgage Support: The Minister of Finance is in touch with the big banks of Canada and is encouraging them to be flexible towards customers whose personal or business finances have been affected by COVID-19. These banks have stated that such help will be inclusive of a payment deferral by 6-months for mortgages as well as relief opportunity on other credit instruments. In addition to these, a 6-month deferral of payment for Mortgages and Car loans may be given on a case-to-case basis.