When the pandemic started, one of the first programs that was launched to support Canadians was the Canada Emergency Relief Benefit (CERB). This program was implemented hastily to help ensure that taxpayers, who were being laid off one after the other, would be supported.
But like anything, confusion and mistakes are the cost of doing something quickly.
As such, Canadians who weren’t actually eligible for CERB applied for the benefit. Time passed and corrections needed to be made, so the government sent out thousands of letters telling taxpayers that they may not be eligible and that those who weren’t were required to pay the government back for the benefits they had received.
You may even be one of the many taxpayers who must repay the government… or maybe you already have paid them back in full?
However, there’s more news that might be in your favour.
You might be eligible for CERB relief as a self-employed individual
Some of the taxpayers, who were required to pay back their CERB payments, may be eligible for relief. And those taxpayers are self-employed individuals.
Why are self-employed individuals receiving relief from CERB repayments?
Because the administration agrees that the information applicants received may have been inaccurate.
When CERB rolled out, applicants had to meet certain eligibility criteria, as is the case with any new benefit program. One of these criteria was that the applicant had to have income of at least $5,000 in the last 12 months. For self-employed individuals this seemingly simple criteria was not so simple.
Some self-employed taxpayers were told by CRA employees that this threshold was in reference to their gross income (total income from all sources before deducting taxes and expenses). But the $5,000 threshold was supposed to be on net income (income after taxes and expenses).
As a result, some taxpayers applied for the program having made more than $5,000 gross income, but after expenses and taxes, their net income was less than $5,000.
The good news is, if you’re one of the many taxpayers who were given incorrect information and used gross income (and most likely received a letter requesting repayment), you’re no longer required to repay your CERB payments. And if you have repaid them, you’ll be getting them back.
For more information on CERB repayment for self-employed individuals, please contact us today.