COVID-19, CRA & Revenu Québec, Tax News

Canada Emergency Response Benefit (CERB)

Updated April 7, 2020

Applications are now open for the Canada Emergency Response Benefit (CERB)!

There are some rules on how to apply and who can apply and even when you can apply, now posted by the CRA.  We’ve summarized those details in the How to Apply section below.

What is the Canada Emergency Response Benefit?

The newly created Canada Emergency Response Benefit (CERB), will provide a taxable benefit of $2,000 per month, for up to 4 months, to qualifying individuals; workers who lose their income as a result of the COVID-19 pandemic.

CERB is a combination of the previously announced Emergency Care Benefit and the Emergency Support Benefit.

Who will be covered?

CERB will benefit many Canadians; Canadians who:

  • Lost their job, are sick, or quarantined, or taking care of someone who is sick with COVID-19
  • Working parents who must stay home, without pay, to care for their children
  • Wage earners, contract workers, and self-employed individuals that wouldn’t normally be eligible for employment insurance (EI)
  • Those that are still employed, but not receiving any income due to disruptions in their working situation due to COVID-19

Those individuals that are currently receiving EI benefits should NOT apply to the CERB at this time; if those benefits end before October 3, 2020, then they can apply at the end of their EI benefits, if they are unable to work due to COVID-19.

What is an “eligible worker” for this benefit?

  • At least 15 years of age,
  • Did not quit you job voluntarily
  • Resident in Canada,
  • Are not receiving EI benefits from Service Canada for the same application period
  • And someone who for 2019 or the 12-months preceding the day they apply, has a total income of at least $5,000 from self-employment, employment, certain EI benefits, or maternity/parental benefits
  • The 1st application qualifiers
    • You have stopped working because of COVID-19 related reasons (layoff, shortage of work, isolation, etc.)
    • You will not receive earnings for the 14 days in a row for the application period, from employment or self-employed income, or benefits related to maternity or paternity leave
  • 2nd and subsequent application qualifiers
    • Still not working because of COVID-19 related reasons
    • You will not receive earnings for the 4 week application period, from employment or self-employed income, or benefits related to maternity or paternity leave

How to apply to the CERB?

To apply for CERB, click on the link HERE and review all aspects of the program and follow the instructions to get prepared.  Applications are now being accepted and eligibility periods are fixed in 4 week periods.  The chart below provided by the CRA explains the period set ups.

You can apply online or over the phone with an automated system.  If the phone lines for the CRA are busy right now, and have your CRA My Account set up, apply online to save yourself some time.

Make sure when you log into your CRA My Account that your direct deposit information is up to date.  These payments are being made to you via direct deposit, so make sure that information is up to date ASAP.  The CRA will pay by cheque, if no banking information is on file, however, to avoid delays, it is recommended that you allow for direct deposit into your bank.

Not everyone is allowed to apply at the same time this week in an attempt not to overload the system.

The below chart has been provided by the CRA to explain when to apply based on your personal information.

Applications may be made for this support payments for any four-week period falling within March 15, 2020 and October 3, 2020.

According to the notice from the Ministry of Finance, eligible applicants should begin receiving their CERB payments within 10 days of applying.

Very important to note is that this benefit is a taxable benefit, which means though there will be no taxes withheld at source you will be taxed on your 2020 income taxes; be sure to put some of this money aside to cover those taxes that become owing, or make sure to take advantage of RRSPs or other deductions and tax credits, come next year.

For more details on income support and other benefits as part of the Federal Government’s Economic Response Plan for COVID-19, click here.

See also our COVID-19: Tax Info Centre, from our TurboTax Support team, answering many FAQs on this topic and more.