The CRA has launched new program websites for the three new temporary recovery benefits: Canada Recovery Benefit (CRB), Canada Recovery Sickness Benefit (CRSB) and Canada Recovery Caregiving Benefit (CRCB). In addition, the government announced that it opened the application process for the CRSB and CRCB on October 5, 2020 while CRB applications will be accepted starting on October 12, 2020. Each webpage has details on the programs.
The CRA’s new program websites include some key information, such as:
- Amounts received under all three benefits are taxable and a 10 per cent withholding tax will be applied at source
- T4A slips will be issued by the CRA reflecting total CRA administered COVID-19 benefits received and taxes withheld at source.
- To ensure the appropriate safeguards are in place to protect Canadians from fraud and non-compliance, CRA is taking steps to implement additional verification and security measures up-front:
- Applications have to be submitted via CRA My Account or by phone for every applicable period.
- The CRA may validate applications by contacting applicants over the phone before processing benefit payments.
- If a recipient mistakenly receives one of these benefit payments, they will need to pay it back to CRA via My Account, online banking or mail; if a cheque is received and not deposited, the cheque must be mailed back to the Sudbury Tax Centre.
The CRB has some unique features, which include:
- Recipients can earn employment and self-employment income while receiving CRB. However, recipients will have to reimburse $0.50 of the benefit for every dollar of net income they earn above $38,000 during the calendar year at the same time their personal tax return is due. Late payments will be charged interest.
- For purposes of calculating the required reimbursement, net income means line 23600 of the recipient’s personal income tax return which includes the CERB, CRCB and CRSB. However, it does not include the CRB and adjustments will be made for split income and certain repaid amounts.
Finally, it should be noted that the legislation for these programs (Bill C-4) received Royal Assent on October 2, 2020.