COVID-19 demolished thousands of jobs and impacted many industries across Canada. Just in January 2021, Canada lost 213,000 jobs. Luckily, the Canada Revenue Agency (CRA) acted quickly to ensure Canadians who experienced job loss could get financial support. The COVID-19 Emergency Response Benefit, also known as CERB, entitled eligible Canadians to bi-weekly payments of $1,000, totalling a $2,000 monthly benefit.
The CERB support was available until December 2020 to Canadians with COVID-19 affected jobs, as long as they:
- Lived in Canada and were at least 15 years old
- Did not apply for Employment Insurance in the same period
- Earned a minimum of $5,000 in the previous tax year, and either:
- Didn’t quit their job voluntarily
- Stopped working because of COVID-19, or experienced reduced work hours because of COVID-19
Who will need to return payment?
Since the Federal Government rolled out CERB payments quickly and efficiently to accommodate the COVID-19 emergency, many applicants received the CERB payment even if they did not fit the eligibility requirements.
It’s possible that some applicants made an honest mistake when applying, or experienced a change of circumstances since they first applied. If the CRA discovers that an ineligible recipient collected CERB, that recipient needs to return the CERB payment, regardless of the reason for being ineligible.
This includes individuals that:
- Earned more income than expected while receiving the CERB payment
- Received both the CERB payment and Employment Insurance in the same period
- Applied for CERB despite being ineligible
How to make a CERB Repayment
You can return CERB payments through a few methods:
By Mail
If you’re preparing to repay CERB via mail, make sure you don’t include any cash in the envelope. Include your social insurance number and make sure you print somewhere on the envelope that the contents are for “Repayment of CERB.”
You can mail your original cheque or repayment of directly deposited CERB payments to this address, and payable to “Receiver General of Canada”:
Revenue Processing
Sudbury Tax Centre
1050 Notre Dame Avenue
Sudbury ON P3A 0C3
Online Banking
Through your financial institution’s online banking service, you can repay your CERB payment to the payee “CRA (revenue) – Canada emergency benefit repayment or CEB repayment.
When prompted for the CRA account number, input your social insurance number.
CRA My Account
The CRA will offer an easy repayment method for CERB through CRA My Account, starting May 11. Once signed into your account, follow these three steps:
- On the Overview page, under the COVID-19 Emergency Support Details section, press the “Proceed to Pay” button
- Input the repayment amount
- Choose your payment method
For information on repaying CERB if you originally applied through Service Canada, visit the CRA’s website.
CERB Repayment Scams
Canadians fall victim to all sorts of tax scams each year. Scams evolve with the world’s circumstances, especially during times of uncertainty and panic. So, it’s no surprise that some scammers saw the COVID-19 pandemic as an opportunity to prey on and financially victimize Canadians.
This year, the CRA reported cyberattack incidents, which made the personal information of thousands of Canadians available to hackers. Through these cyberattacks, hackers changed the direct deposit information of CERB applicants to steal their payments.
Some scammers contact Canadians via telephone, text, or email and request money from them under the guise of a CRA agent. Remember, the CRA only contacts Canadians by letter. If you receive any other forms of communication from someone claiming to be from the CRA, contact the Canadian Anti-Fraud Centre.
CERB Taxes
CERB applicants who were eligible for the entirety of their collection period will not need to repay the CERB; however, they still need to report that income and pay taxes on it. The amount of tax you owe is dependent on the income you received, but some exclusions apply, specifically for Indigenous peoples.
There are different reporting requirements that depend on whether you applied for CERB through the CRA or through Service Canada – visit the CRA’s website for more details.
Despite the COVID-19 pandemic making it a hard financial year for everyone, the CRA still expects you to pay all of your taxes on time. If you don’t pay your taxes you can face hefty penalties. Additionally, if you don’t pay on time, you can face late-filing penalties averaging at 5% of your 2020 owed balance, and an extra 1% for each month you are late.
Final Thoughts
COVID-19 caused financial instability for many Canadians, even with the government’s CERB payments. If you can’t make CERB repayments and are considering a consumer proposal, call Consolidated Credit Canada today.
