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Many Canadians are facing a significant loss of income because of the coronavirus crisis. To ease financial stress, the federal government has introduced a number of benefit programs for parents, students, full-time, self-employed and contract workers. Read on to learn all about COVID-19 emergency benefits and financial relief from the Canadian government.

As COVID-19 continues to spread across the country, more Canadians are finding themselves out of work or dealing with decreased income due to the pandemic. Fortunately, the federal government has announced a series of measures to help citizens make ends meet in this stressful time. Whether you’re a parent staying home to care for your children, a freelancer dealing with a reduced client base, or have been laid-off and are having trouble paying your student loans, there is a benefit or financial relief program available. Here are the top emergency financial relief programs:

If You Lost Your Job – Employment Insurance

If you lost your job through no fault of your own, there’s a good chance that you qualify for Employment Insurance (EI) regular benefits.

Do I qualify for EI and how to apply?

You may be entitled to EI regular benefits if you:

  • Were employed in insurable employment;
  • Lost your job through no fault of your own;
  • Have been without work and without pay for at least seven consecutive days in the last 52 weeks;
  • Have worked for the required number of insurable employment hours (between 420 to 700 hours) in the last 52 weeks or since the start of your last EI claim, whichever is shorter;
  • Are “ready, willing and capable of working each day;”
  • Are actively looking for work (make sure to keep a written record of employers you contact, including when you contacted them).

You can apply on the Government of Canada’s Employment Insurance website.

If You’ve Lost Income – Canada Emergency Response Benefit (CERB)

COVID-19 has negatively impacted the finances of millions of Canadians, from wage earners to contractors and small business owners, almost everyone will be affected negatively. Even worse, many may not qualify for Employment Insurance regular benefits. To help Canadians cope with the loss of income, the federal government launched the Canada Emergency Response Benefit (CERB).

The CERB provides a taxable benefit to workers who:
  • 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.
This program is available to anyone who has lost their income due to COVID-19. If you’ve been laid-off, stayed home due to sickness, quarantine, or had to take care of a child or family member, the CERB is for you. This benefit replaces traditional employment insurance in the short term and is also available to Canadians who otherwise wouldn’t qualify for employment insurance. This program launches on April 6. Applications will be accepted both online and over the phone. You should expect to receive your first payment within 10 days after your application is submitted.
The CERB will provide a flat payment for income support of $2,000 per month for a maximum of four months (until October 3, 2020). It is a taxable benefit.
If you’ve recently been laid-off by an employer and have not applied for employment insurance yet, the government encourages you to use CERB instead of EI since the EI program was not designed for such a large volume of applications and faces a backlog.
If you are already receiving EI or Employment Insurance Sickness Benefits, your payments will continue and you don’t need to apply for CERB.
Once you no longer receive EI, you will be able to apply for CERB any time before October 3. Learn more about the Canada Emergency Response Benefit.

If Your Working Hours Have Been Reduced – EI Work Sharing Program Extension

If you are still working but your hours have been cut and you meet the eligibility requirements for employment insurance, your employer may apply for the Work Sharing Program. It was designed to help employers and employees avoid layoffs due to a temporary reduction in business beyond their control. It provides income support to employees eligible for employment insurance benefits who work a temporarily reduced work week while their employer recovers.

How Long Can We Work Under the EI Work Sharing Program?

Due to COVID-19, the Work Sharing Program has been extended from a maximum of 38 weeks up to 76 weeks. Learn more about the Work Sharing Program.

If You Have Children – Canada Child Benefit Top-Up

The estimated 3.5 million families with children who regularly receive the Canada Child Benefit will be able to put a little more cash in their pockets this year.

Your CCB will increase the maximum annual payment by $300 per child (under age 18) for the entire 2019-2020 benefit year. The first increased payment will go out in May. The average family is expected to receive about $550 extra per month.
You don’t need to apply for this benefit, it will be added to your current CCB payments automatically. Learn more about the Canada Child Benefit Top-Up.

If You Have Student Loans – Student Loan Interest Moratorium

Canadians with public student loans through Canada Student Loan can take advantage of the six-month, interest-free grace period. It is similar to the grace period available immediately after graduating from post-secondary school.

The grace period runs from March 30 until September 30, 2020.

If You Have a Mortgage – Deferred Mortgage Payments

If the benefits above aren’t adding up for you, and you’ve bought a house in Canada, you might be worried about how you’re going to make your mortgage payments. Several of Canada’s biggest mortgage lenders have indicated via social media that they will allow their borrowers to defer their mortgage payments, or to “skip a payment.” These options are available on mortgages and other types of loans and credit card payments as well.

How Do I Apply to Skip a Payment or Defer My Mortgage Payment?

With encouragement from the federal government, most lenders have indicated that deferrals will be granted on a case-by-case basis. If you aren’t sure you will be able to make your next mortgage payment, contact your lender directly to discuss a deferral. Make sure you fully understand how the change will affect your future interest payments, any potential penalties you could occur and impact on your credit rating. Learn more about mortgage payment deferrals.

If You Are Retired – Minimum RRIF Withdrawal Reduction

Public health isn’t the only thing that COVID-19 has wreaked havoc on. The stock market has been chaotic with losses cutting into portfolios and causing even seasoned investors to cringe. If you’re retired and drawing from your Registered Retirement Income Fund (RRIF) or defined contribution pension plan, you can reduce the total amount you withdraw this year by 25%.

Why Would I Reduce the Amount I Withdraw From My RRIF?

This change gives you the benefit of reducing how much of your retirement fund you need to liquidate. By minimizing the amount you withdraw, you’ll allow the remaining amount more time to increase in value when the stock market recovers. Learn more about RRIF withdrawal reductions.

If You Are a Small Business Owner or Contractor – Income Tax Deferral

The Canada Revenue Agency has issued several deferral notices to small business owners and others making quarterly income tax payments. Right now, your income taxes are deferred until August 31, 2020.

This deferral includes both taxes due and installment payments.

For Canadians Filing Income Tax Returns – Deadlines Extended

This time of year is usually known as income tax filing season. Unfortunately, the COVID-19 pandemic has diverted everyone’s attention from filing income taxes. In response, the CRA has extended the deadline for filing until June 1, 2020.

If you owe a balance to the CRA, you won’t have to pay those taxes until August 31, 2020.
The CRA advises Canadians applying for the GSTC or the Canada Child Benefit to submit their tax return as early as possible since it is a requirement for accessing these programs. Consider using TurboTax software to prepare your taxes with minimum stress by guiding you through your tax return and flags potential deductions as you go. You can submit your completed return directly to CRA through its integrated system with just one click. Learn more about tax deadlines and deferral options.

For Low-Income Canadians – GST Credit Top-Up

The Goods and Services Tax Credit is a tax-free quarterly payment available for low- and middle-income families. You are assessed automatically for the GSTC when you submit your income tax return. This year, the federal government is increasing the payment, which will effectively double the size of the GSTC and benefit about 12 million Canadians.

The GSTC top-up is a one-time increase of about $400 for individuals and $600 for couples.
The top-up payment will appear on your May installment payment. Learn more about the GSTC top-up.

The Last Word

The COVID-19 pandemic is a public health crisis unlike anything we’ve seen in our lifetimes. The Canadian government understands that the measures they’ve put in place to limit the spread of the virus have caused financial hardship for businesses and workers. The feds have made it clear that they are prepared to introduce additional measures in the future to reduce the impact the coronavirus pandemic is having on Canadians. Keep checking back regularly for updates since the government programs outlined above are actively evolving and may change on short notice.

If you can’t make ends meet, you may need to tap into your emergency fund, take out a personal loan, or use a low-interest credit card. Another option to tide you over KOHO’s Early Payroll feature, which lets you access up to $100 of your paycheque three days early, to help you access enough cash to stay afloat during these trying times. Read about How to Survive a Financial Crisis for more expert advice.

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Article comments

2 comments
karen says:

is there a phone number to call for the CERB for people who don’t have internet??

Lisa Jackson says:

Yes. You can call 1-800-959-2019 or 1-800-959-2041.