If you have received a letter from the CRA regarding Canada Emergency Response Benefit (CERB) ineligibility – you’re not the only one.

Many Canadians have received letters regarding repayment of CERB for one of the following reasons:

• Collected CERB payments from both Service Canada and the CRA.
• Did not meet the minimum income requirement.

According to CTV News, 441,000 ‘educational’ letters were sent to Canadians by mid-December.

So, if you have received a letter that states that you may not be eligible, it may be because the CRA has been unable to confirm your eligibility, possibly because you have not filed your taxes in 2019.

If that’s not the case and you have filed your taxes, you might have to pay the benefit back.

CERB Repayment and Eligibility

The reason why there has been some confusion about eligibility is because of what is and what is not considered as ‘income’. For instance, the minimum employment or self-employment income required to be eligible for CERB ($5,000) is net income and not gross income.

Additionally, the following sources of income are not considered as employment or self-employment income when it comes to CERB:

• Pension income;
• Student loans;
• Employment Insurance payments;
• Disability benefits;
• Family support and social assistance payments;
• Other benefits such as Canada Child Benefit (CCB);
• And investment Income.

So, if this criterion is not met, CRA is encouraging individuals to return the benefit they have claimed.

The process for returning CERB is quite straightforward. If you applied for and received the CERB from the CRA and Service Canada, you can view step-by-step guidelines for repayment here.

As of mid-December, according to Narcity, the CRA has received almost 1 million returns.

What Action Can CRA Take?

If you are unable to repay the benefit, the CRA requires you to contact them and make a payment arrangement.

While CRA has taken a more relaxed approach to CERB repayments last year and informed individuals to repay the amount voluntarily, if the payments are not made, the CRA may take a tougher approach.

While a stronger collection action has not been indicated at this point, once this amount gets added to your overall debt with the CRA, it can lead to the agency withholding benefits and credits, imposing penalties, as well as taking other legal actions.

What Are Your Options? 

So, when it comes to CERB repayment, you have the following options available to you:

• Full repayment of the benefit.
• Making repayment arrangements with the CRA.
• If you’re unable to make payments and are dealing with additional debt, you can look into filing for bankruptcy or a consumer proposal. This is where a debt consolidation partner can help alleviate your debt burden.

At DebtCare Canada, we are committed to helping you manage your debt and put strategies in place to become debt-free.

If you are worried about CERB repayment or would like advice about debt management, you can contact us for a free consultation and an independent review of your financial situation.

Reach out to us today at 1-888-890-0888 or visit www.debtcare.ca.