The government of Canada is rolling out new benefits for those of you who are not eligible for regular employment insurance (EI).
As you may already know, the government introduced the CERB, which stands for Canada’s emergency response benefit early in March to help those that lost their jobs or faced financial hardships due to the COVID-19 pandemic.
Unfortunately, the CERB has come to an end. But worry not, the government of Canada just announced another set of benefits that may be helpful to you during these hard times.
Here is a list of some of the new benefits that you can apply for:
- Canada Recovery Benefit (CRB)
- Canada Recovery Sickness Benefit (CRSB)
- Canada Recovery Caregiving Benefit (CRCB)
- Canada Emergency Wage Subsidy (CEWS)
In this article, we are gonna focus on the Canada Recovery Benefit (CRB). If you are interested in learning more about the other benefits, feel free to visit CRA’s website to learn more about them.
So what is the Canada Recovery Benefit?
The CRB was introduced by the Government of Canada to replace the CERB. The goal of the CRB is to give income support to individuals that are facing financial hardship due to COVID-19.
The CRA’s (Canada Revenue Agency) administer this program and will automatically deduct 10% of every payment you receive to reduce your taxes owing when comes tax season.
Please be aware that you may owe more or less depending on how much money you earn during the year 2020.
When you apply, you will get up to $1000 – $100 (10%) = $900 net taxable income every two weeks as long as you maintain your eligibility to receive it.
The CRB, as opposed to the old CERB, doesn’t renew automatically. So, you will have to re-apply again at the end of every two weeks if your situation is still the same.
Please note that you can only claim the CRB for up to 26 weeks (13 periods) between September 27, 2020, and September 25, 2021.
Before you apply for the new CRB, you have to make sure to meet all the eligibility requirements to avoid having your application rejected or to be later asked to return all the money that has been given to you.
So, let’s go over the requirements.
First, you have to not have been working because your employment or self-employment was affected directly by the pandemic, and you are not eligible for regular employment insurance benefits.
If that is not your case, you can also be eligible if your weekly income is 50% or less than what you used to make during the year 2019.
Let’s take a fictional character called Bob as an example. Bob is self-employed and made $40,000 during the year 2019. Unfortunately, Bob’s business got affected by the pandemic, and now makes $400 per week.
First, we have to calculate Bob’s weekly income in 2019. To be able to do this, we take his yearly income of $40,000 and divide it by 52, which gives us a weekly income of $769.23.
To be eligible for the CRB, you have to make 50% or less of what you used to make during 2019. 50% of Bob’s weekly income during 2019 is $384.61. In this case, Bob is not eligible for the CRB since his weekly income of $400 is above the threshold of $384.61.
For Bob to be eligible for the CRB, he has to make $384.61 or less every week.
Second, you have to make sure that you did not apply for any other government benefit such as CRSB, CRCB, EI, workers’ comp, and disability.
Third, you have to reside and live in Canada and be at least 15 years old. You do not have to be a Canadian Citizen or Permanent Resident to apply, but you should be able to remain legally in Canada and possess a valid social insurance number (SIN).
Fourth, you have earned at least $5000 during 2019 or 2020 or in the 12 months before you plan to apply.
You also have to not quit your job voluntarily or asked your employer to fire you on or after September 27, 2020. You will not be eligible if you quit your job to receive the CRB.
If you are currently unemployed, you have to be looking for work during the period in which you are receiving the CRB. You also cannot refuse any reasonable work offered to you during this period.
Please note, that you can receive the CRB and employment income as long as your weekly total income is less than 50% of what you used to make in 2019.
If your yearly income surpasses the amount of $38,000, keep in mind that you will have to return $0.5 of every dollar you have received from the CRB.
Finally, please be aware that there are penalties that may render you ineligible for the CRB such as refusing work which can prevent you from collecting the CRB for 10 weeks.
If you are unsure if you qualify for the CRB or have any other questions. Feel free to leave me a comment below.
Here is a recap of the eligibility requirements:
- You reside and live in Canada & have a valid SIN.
- You are at least 15 years old.
- You have made at least $5000 during 2019, 2020, or in the 12 months prior to your first application for the CRB.
- You did not quit your job voluntarily on or after September 27, 2020.
- You did not refuse any reasonable work offered to you.
- You are not eligible to receive regular EI.
- You stopped work for reasons related to COVID-19 or lost more than 50% of your revenue.
How to apply for the CRB?
If you have determined that you are eligible to receive the CRB then hooray, I am going to show you shortly how you can apply for this new benefit.
If not, then don’t lose hope yet. Make sure to read about the other benefits by visiting CRA’s website and see if you are eligible for them.
To apply for the CRB. First, head over to the login or create an account with the CRA.
Don’t worry if you don’t have an account. Signing-up is very easy, just make sure to have your social insurance number & your last notice of assessment handy.
After you login/sign-up you will land in this page. Just click on the apply for Canada Recovery Benefits.
Then, select the situation that best applies to you.
Make sure to answer the following questions truthfully and click next. You may be asked to return all payments if you are deemed to be ineligible later on.
You will then be taken to a page where you have to confirm that you answered everything truthfully. After that is done, you will be on your way to receiving your first CRB payment. Make sure that all your direct deposit information is correct.
The Canada recovery benefit can be a great way to help those of us that are facing financial hardship during these uncertain times.
Even though the CRB payments might not be enough, for some of us, to cover all of their expenses. You should make a habit of saving at least 10% of your income.
If you are looking to save or invest your money, I’d suggest you read about Wealthsimple.
Wealthsimple is a great investing / saving tool that helps you save more by allowing you to set automatic pre-authorized debit that gets deposited directly to your savings / investing account. They also offer one of the highest interest rates at the moment of 0.75%, which is incredibly high compared to the actual rate of 0.05% – 0.1% that is offered by the big banks.
To sum this up, I hope that this article has helped you shed some light on the new Canada recovery Benefit. If you have found this helpful, please consider sharing this article with whoever might find this helpful.
Thanks for reading. If you have any questions, feel free to leave a comment below!