Government of Canada to reimburse self-employed workers who repaid the CERB
CRA SOURCE ARTICLE
Over the course of the COVID-19 pandemic, the Government of Canada has introduced historic measures to support Canadians, including the Canada Emergency Response Benefit (CERB). The CERB helped more than 8 million Canadians pay for things like food and rent when we first asked people to stay home and flatten the curve.
The CERB’s eligibility criteria were made as broad and inclusive as possible so that workers who needed support could get it; especially for the self-employed whose income takes different forms.
As announced in February, self-employed workers who applied for the CERB and would have qualified based on their gross income are not required to repay the benefit, provided they also met all other eligibility criteria. Today, the Government of Canada announced further details on how this approach will be applied.
Self-employed workers whose net self-employment income was less than $5,000 and who applied for the CERB will not be required to repay the CERB, as long as:
They have filed their 2019 and 2020 income tax returns by December 31, 2022;
Their gross self-employment income was $5,000 or more in 2019 or in the 12 months prior to their initial application; and
They met all other CERB eligibility criteria.
The CRA will review the 2019 and 2020 income tax returns of workers in this situation to verify that these conditions are met.
Starting on May 27, 2021, self-employed workers who meet the remission order criteria and who had voluntarily repaid all or part of the CERB to the CRA or Service Canada can request a reimbursement of their payments only from the CRA. These workers can do so by completing the CRA’s CERB Reimbursement Application for Self-Employed Individuals form and submitting it to the CRA electronically or by mail.
The CRA will begin processing applications after June 15, 2021. Eligible Canadians who repaid the CERB can expect reimbursements within approximately 90 days of submitting their applications to the CRA.
Quick facts
The Canada Emergency Response Benefit and Employment Insurance Emergency Response Benefit Remission Order grants relief of the collection of certain overpayments and certain payments of the CERB for self-employed individuals who applied for the CERB and would have qualified based on their gross income. The remission order was approved by the Administrator in Council on the recommendation of the Minister of Employment and Social Development Canada and Treasury Board on April 30, 2021.
The remission order for self-employed individuals is published in the Canada Gazette.
Individuals who have not made a repayment to the CRA or Service Canada and meet the eligibility criteria for the remission order do not need to contact the CRA or Service Canada to confirm that they will not have to repay the CERB.
The CRA may reassess 2020 income tax returns for individuals who are reimbursed CERB repayments, to reflect the CERB as appropriate. If necessary, the T4A slip or RL-1 slip will be amended to include the full CERB amount received in 2020 and the income tax return adjusted accordingly. Workers who received the CERB from Service Canada will receive an amended T4E slip, if necessary.
The application period for the CERB closed on December 2, 2020. Individuals can only be reimbursed for periods that they repaid. Individuals cannot apply for the CERB retroactively.
You can learn more about CERB by visiting the CRA website or by scheduling a free consultation with us.