Pandemic benefits possibly coming to an end
Since March of 2020, tens of millions of Canadians have received pandemic benefits. In some cases, those benefits have been received directly by individuals — typically, through the Canada Emergency Response Benefit (CERB) and, later, the Canada Recovery Benefit (CRB). In other cases, benefits have been provided to businesses, in some cases to assist them with rent payments or, in others, to subsidize employee wages.
Each of the pandemic economic assistance programs provided has been tweaked, renewed, and extended several times, and the current status of each such benefit program can be hard to remember. What follows is a summary of the major programs which are currently (as of September 2021) in place, and the dates on which those programs are currently scheduled to come to an end. Barring any changes by the newly elected federal government, most of the following programs are scheduled to end in October 2021.
Benefit programs for individuals
Canada Recovery Benefit
The CRB replaced the initial pandemic relief program, the CERB, in September of 2020.
The CRB is an income replacement benefit paid to those who are not working due to the pandemic or who have experienced a 50% reduction in income when compared to the previous year, again for pandemic-related reasons. To receive the CRB, an individual must have earned at least $5,000 in 2019, 2020, or during the previous 12 months and must not be eligible for Employment Insurance.
The amount which can be received under the CRB program depends on when an application for the benefit is made. Individuals who apply after July 17, 2021 can receive $600 for each two-week period. Those who applied prior to July 18, 2021 can receive $1,000 each subsequent two-week period.
Under current rules, the CRB is scheduled to end on October 23, 2021. However, it is possible to apply for the CRB after that date, as the rules allow applications to be made retroactively for any two-week period up to 60 days after that period has ended.
Canada Recovery Sickness Benefit
The eligibility criteria for the Canada Recovery Sickness Benefit (CRSB) are much narrower than those for the CRB and consequently the rules are much simpler.
The CRSB is paid to those who miss more than 50% of their work week because they are sick with COVID-19, because they have been advised to self-isolate due to COVID-19 or because they have a health condition which puts them at greater risk of contracting COVID-19.
The benefit of $500 per week is paid for a maximum of four weeks, and those weeks do not have to be consecutive.
Like the CRB, the CRSB program is scheduled to end on October 23, 2021, but applications for any one-week benefit period can be made up to 60 days after the end of that benefit period.
Canada Recovery Caregiving Benefit
As the name implies, the Canada Recovery Caregiving Benefit (CRCB) can be claimed by those who are unable to work because they must care for their child under 12 years old or for a family member who needs supervised care. That need for care can arise because the family member is ill, self-isolating, or at risk of serious health complications because of COVID-19, or because their school, regular program, or facility is closed or unavailable to them for pandemic-related reasons.
The CRCB is paid as a $500-per-week benefit, for a maximum of 42 weeks. Those 42 weeks are not required to be consecutive weeks.
The CRCB program is scheduled to end on October 23, 2021, but application for the benefit can be made up to 60 days after the end of a benefit period.
It’s apparent that an individual could, under the eligibility requirements, qualify for more than one of the above benefits during the same time period. However, the rules prevent such “double-dipping”, by providing that only one such pandemic benefit can be received during for a particular time period. In addition, individuals are generally not eligible for any of the above benefits for a time period during which they were receiving Employment Insurance, short-term disability benefits, or (in the province of Quebec) Quebec Parental Insurance Benefits.
More information on each of these individual pandemic benefits can be found on the government of Canada website at https://www.canada.ca/en/services/benefits/covid19-emergency-benefits.html
Benefits for businesses
Over the past year and a half, the federal government has provided a number of rent subsidy and wage subsidy programs to enable businesses to cover their fixed costs during lockdowns and to bring back employees once it was possible to re-open. The major current programs in those areas are as follows.
Canada Emergency Wage Subsidy
The Canada Emergency Wage Subsidy or CEWS provides a subsidy on eligible salary or wages to help businesses hire and pay workers. Under the program terms, eligible employers can hire new workers, increase workers’ hours, or increase wages.
The CEWS program will continue until October 23, 2021.
Canada Recovery Hiring Program
Like the CEWS, the Canada Recovery Hiring Program (CRHP), which was introduced on June 6, 2021, provides a subsidy on eligible salary or wages to help businesses hire and pay workers. Most of the eligibility criteria under the CEWS and the CRHP are the same (although the calculation of benefits differs) and, under both programs, eligible employers can hire new workers, increase workers’ hours, or increase wages.
The CRHP serves many of the same purposes as the CEWS. There is an overlap period for the two programs between June 6 and October 23, 2021, and eligible employers can in fact choose which program to apply to for any eligibility period during that overlap period. The federal government provides an online calculator to enable businesses to determine which benefit is more advantageous, and that calculator can be found at https://www.canada.ca/en/revenue-agency/services/subsidy/calculate-wage-hiring-subsidies.html
Employers can apply for the CRHP for a four-week period, and applications for support must be made again for each subsequent four-week period. An application for a specific four-week claim period can be made up to 180 days after the end of that claim period.
Unlike some other business pandemic support programs, the CRHP is scheduled to be available until November 20, 2021.
Canada Emergency Rent Subsidy
The Canada Emergency Rent Subsidy (CERS) provides a rent and mortgage subsidy for eligible expenses to qualifying businesses, charities, and non-profits. Unlike an earlier version of the commercial tenant support program, the CERS is applied for by, and paid directly to, tenants and property owners. There is no requirement for participation by landlords.
An additional 25% in rent support is available under the CERS program for businesses which were “significantly restricted” by mandatory public health orders.
The CERS program will be available until October 23, 2021. However, eligible businesses can apply for any particular claim period up to 180 days after the end of that claim period.
The programs listed above are the main pandemic benefit programs currently available to individuals and businesses. While the purpose of each program and the benefits to be obtained are relatively straightforward, there are myriad details with respect to eligibility, application processes, determination of benefits, and tax treatment of those benefits. As well, there are many other such programs offered by the federal government. Detailed information on all such pandemic relief programs can be found on the federal government website at https://www.canada.ca/en/department-finance/economic-response-plan.html#businesses
Finally, the information summarized above with respect to pandemic benefits is current as of September 26, 2021. Extensions of such programs, or changes to program terms may be made before the programs expire. Should that occur, information on the changes will be available on the federal government website at https://www.canada.ca/en/department-finance/economic-response-plan.html#businesses
The information presented is only of a general nature, may omit many details and special rules, is current only as of its published date, and accordingly cannot be regarded as legal or tax advice. Please contact our office for more information on this subject and how it pertains to your specific tax or financial situation.