CERB may have transitioned into the Canada Recovery Benefit program, but the popular program is still
CRA recently issued notices to 200,000 Canadians warning they may have been paid double CERB benefits and repayment will be expected. These are just people who appear to have claimed both
through CRA and through Service Canada. There are a number of other reasons why you may be expected to repay some or all of your CERB benefits.
There was a lot of confusion when the program rolled out so quickly and that is understandable. I have spoken with a number of people who were short of money and were told by a friend, family member, and even one accountant to just log in or call and collect their $2,000 per month even though they had not been working prior to the pandemic and clearly didn’t qualify. CERB is an income replacement program so if you were a pensioner or on social assistance and didn’t work before the first shutdown, this was not the program for you.
If you received CERB money that you know you weren’t entitled to (an overpayment), and you still have the money, you should seriously consider paying it back before December 31 this year. Otherwise, you will receive a tax slip from CRA and you will have to pay tax on the money you received. Eventually, CRA’s collectors will come knocking and you will have to repay the CERB overpayment as well. CRA’s website is silent on what will happen if you repay the CERB overpayment next year. Perhaps they will allow a deduction from income in the year you repay, and perhaps not. If they don’t, you will end up paying tax on income you didn’t get to keep.
If you are struggling with debts and need help, call Vine and Williams Inc., Licensed Insolvency Trustees at 1-833-808-VINE(8463) or email us at firstname.lastname@example.org. We will review your situation and work with you on a plan to deal with all of your debts, including CERB overpayments and income taxes.