On October 2, the COVID-19 Response Measures Act received Royal Assent. This legislation creates three new temporary recovery benefits to support Canadians who are unable to work for reasons related to COVID-19. These benefit programs are available to both employees and self-employed individuals and you can only receive payments from one of the programs during a claim period.
These benefits will be in place for one year beginning September 27, 2020 and provide for a benefit of $500, prior to taxes, per week. The eligibility requirements and details along with how to apply can be found on the “Assistance for Alberta Residents” document on our tax tools resource page.
The 3 benefits are:
- Canada Recovery Benefit (CRB) for workers who have stopped working and are not eligible for EI or have had their employment or self-employment income reduced by at least 50% due to COVID-19,
- Canada Recovery Sickness Benefit (CRSB) for workers who are unable to work because they contracted COVID-19, are self-isolated for reasons related to COVID-19, or have underlying conditions that would make them more susceptible to COVID-19; and
- Canada Recovery Caregiving Benefit (CRCB) for workers to care for children or family members who are sick or required to quarantine or whose school or care facilities are closed.
Eligible individuals are able to apply for the recovery benefits online through the CRA’s My Account portal or by phone through the CRA’s automated phone line. The CRCB and CRSB applications opened on October 5 and the CRB applications will open on October 12.
These payments are subject to income tax. The CRA will withhold 10% of the payments and the recipient will receive the net amount. The amount of tax that the recipient will ultimately pay will be based on the amount of total income from all sources received in the year.
The CRB will be subject to a claw back if your net income for the year, prior to the CRB, exceeds $38,000. You will have to reimburse $0.50 of the CRB for every dollar of net income that you earned above $38,000. This will be due at the same time as your income tax return for the year. Although the CRB is not included in net income for this calculation, other benefits such as the CRSB, CRCB, and the CERB are included.
Your KMSS advisor is here to assist with these programs. As an employee or self-employed individual, we can help you determine if you qualify and as a business owner, we can help you understand the support that is available to your workers if they have been impacted by COVID-19.