On June 23, the Canada Revenue Agency website was updated to confirm an extension to the CERB program to further support individuals through the COVID-19 crisis. The team at Clearly Financials would like to continue to support individuals and families in our local Edmonton community by sharing some updates.
CERB Extended from 16 Weeks to 24 Weeks
The Canada Emergency Response Benefit (CERB) provides $500/week for “those who have stopped working or whose work hours have been reduced.”
Please view our previous blog post for additional background information on CERB.
Additional 2 periods available - The Canada Emergency Response Benefit (CERB) has extended from a 16-week period to a 24-week period. If your situation continues, you can re-apply for another for two additional periods, up to a maximum of 6 periods or 24 weeks in total.
Next CERB Eligibility Period
Applications opened on July 6, 2020 for period 5. This period runs from July 5, 2020 to August 1, 2020.
Application Period
The benefit is available from March 15, 2020 to October 3, 2020. You can apply no later than December 2, 2020 for retroactive payments.
How to Apply for the Extension
You can continue to apply as you have for the previous 16 weeks:
Through CRA if you are not EI eligible, or
Through Service Canada if you are EI eligible
Can I Apply If My Personal Tax Filings Are Not Up to Date?
Yes. You will need to confirm that you had at least $5,000 of employment or self-employment income in 2019 or the previous 12 months. Also, you will need to confirm that you meet the threshold of earning under $1,000.
What Is Included in the $1,000 Income I Can Earn?
Included
Income from employment and/or self-employment
Non-eligible dividends
Tips
Honoraria
Royalties (other than royalties for work produced before the application period)
Not Included
Pensions
Student loans
Bursaries
Most forms of rental income
Most forms of investment income
Highlights and Reminders
Taxable Benefit - The CERB is a taxable benefit. Recipients should be prepared to report the income on their 2020 personal tax returns, and potentially pay tax on the income amounts. Tax slips will be made available for the 2020 year through CRA My Account.
Social Assistance Benefits - Individuals receiving social assistance benefits and CERB at the same time may have some CERB or social assistance amounts reduced. The Government of Alberta provides more information on their website. The interaction between CERB and social assistance benefits varies by province. Individuals are advised to seek information for their social assistance benefit program prior to applying for CERB.
Students - Students that do not qualify for the CERB may qualify for the Canada Emergency Student Benefit (CESB).
Other Financial Aid - Applicants who do not qualify on CERB or CESB may be qualified for other programs. Financial help during COVID-19.
Personal Tax Filing Deadline and Payment Deadline Extensions
General Personal Tax Deadlines
Standard filing deadline: April 30th.
Standard payment deadline: April 30th.
Due to COVID-19, the payment and filing deadlines have both been extended.
Extended filing deadline: June 1, 2020. The CRA announced that late-filing penalties would not apply to returns filed by September 1, 2020.
Extended payment deadline: September 1, 2020.
Personal Tax Deadlines for Self-Employed Individuals
If you, your spouse, or common-law partner are self-employed, you have additional time to file your personal tax returns.
Standard filing deadline: June 15th (This applies to most years, and is unrelated to COVID-19 extensions).
Standard payment deadline: April 30th.
Due to COVID-19, the payment deadline has been extended for self-employed individuals.
Extended payment deadline: September 1, 2020.
Interest and Penalties
If you file past the extension date, and have filed the previous 3 years on time:
Late-filing penalties = 5% + 1% per month (up to 12 months)
Interest = the CRA’s prescribed rate, currently 5% per year.
If you file past the extension date, and filed late in 2016, 2017, or 2018
Late-filing penalties = 10% + 2% per month (up to 20 months)
Interest = the CRA’s prescribed rate, currently 5% per year.
There are no late-filing penalties for individuals receiving a refund. Penalties only apply to balances owing to the CRA.
More information may be found on the Canada Revenue Agency website.
In Closing
We understand that these are challenging times for many individuals and families in Edmonton. We are working diligently at Clearly Financials to support our local communities through these unprecedented changes.
Realize that you are not alone, that we are in this together and most importantly that there is hope.
For other COVID-19 resources please view the COVID-19 resources on our website.
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Disclaimer
This is a summarized version of complex matters that are rapidly changing. We expect further clarification from the government in the coming days. The preceding information is provided for educational purposes only. Speak with one of our advisors if you have any questions about your specific accounting or tax situation.
Clearly Financials offers start-up, accounting, corporate tax, virtual CFO and advisory services for small businesses.
We also provide personal tax return preparation services for individuals and families.
Our office is located in Edmonton, Alberta. Through the power of cloud technology, we are able serve clients throughout Canada.