ENDED – The Canada Emergency Response Benefit (CERB)

The CERB has now ended. The CRA is continuing to accept and process retroactive applications for period #7 (August 30 to September 26, 2020), however applications are only being accepted through CRA’s automated toll-free phone line at 1-800-959-2019 or 1-800-959-2041.

On April 23, 2020, CRA further clarified what income can be earned while collecting CERB

Are self-employed small business owners eligible for the Canada Emergency Response Benefit?

Yes provided they meet the eligibility criteria including that they stopped working due to COVID-19 and do not earn more than $1000 in a period of at least 14 consecutive days in the first benefit period and for the entire four-week benefit period of any subsequent claim.

Small Business owners can receive income from their business in different ways, including as salary, business income or dividends.  In determining their eligibility for the Canada Emergency Response Benefit:

  • Owners who take a salary from their business should consider their pre-tax salary;
  • Owners who rely on business income should consider their net pre-tax income (gross income less expenses);
  • Owners who rely on dividend income should consider this as self-employment income provided it comes from non–eligible dividends (generally, those paid out of corporate income taxed at the small business rate).

CRA has expanded its questions and answers related to CERB which can be found HERE

On April 20, 2020, CRA clarified what income can be earned while collecting CERB

What counts towards the $1,000 in income I can earn?

The $1,000 includes employment and/or self-employment income. This includes among others: tips you may earn while working; non-eligible dividends; honoraria (e.g., nominal amounts paid to emergency service volunteers); and royalties (e.g., paid to artists).

However, royalty payments received from work that took place before the period for which a person applies for the CERB do not count as income during that specific benefit period.

Pensions, student loans and bursaries are not employment income and therefore, should not be included in the $1000.

Applications will be verified against tax records to confirm income.

On April 15, 2020, Prime Minister Trudeau announced that Canadians will now be allowed to collect the CERB even if they still have some earnings, as long as their monthly income does not surpass $1,000.

Also, access to the emergency benefit will be expanded to seasonal workers who have exhausted their EI benefits and can’t find their usual seasonal work as a result of the pandemic.

Finally, Ottawa is planning to work with the provinces and territories to provide financial help to essential workers, such as those employed in long-term care homes, who earn less than $2,500 a month.

The Federal Government will provide a taxable benefit of $2,000 a month for up to 4 months to:

  • workers who must stop working due to COVID19 and do not have access to paid leave or other income support.
  • workers who are sick, quarantined, or taking care of someone who is sick with COVID-19.
  • working parents who must stay home without pay to care for children that are sick or need additional care because of school and daycare closures.
  • workers who still have their employment but are not being paid because there is currently not sufficient work and their employer has asked them not to come to work.
  • wage earners and self-employed individuals, including contract workers, who would not otherwise be eligible for Employment Insurance.

Apply for The Canada Emergency Response Benefit HERE

Some additional information:

CRA had added several questions and answers related to CERB which can be found HERE