Proposed $2,000/month Canada Emergency Response Benefit | Page 6 | General financial discussion | Discussion forum

Bill said
Can't speak for others' ideas but my own proposal was that those whose incomes are unaffected by the virus (all private sector workers of all ages who continue to make their money, teachers and other public sector workers who continue to make their money, non low-income seniors who continue to make their money, etc) pay a greater share of CERB, etc, i.e. the extra costs to help those whose incomes are reduced (unable to work or reduced hours) due to this virus.

I'm not sure I've seen anyone here advocate just seniors should pay just young people (plus I'm not even sure there's data that younger people live paycheque to paycheque any more than middle-age or older workers, for example), but even if so I'm pretty sure no-one would agree with that. Mr Trudeau keeps talking about "Canadians", the idea is we're all in this together.  

If the idea is "we are all in this together", then it is only fair that those that DOES receive help right now to pay it back over time in the future. The group that you targeted (those unaffected money wise currently) are already paying their tax while NOT reaping any benefits from the bail out package. So I dont agree why they should pay "more". Just because they can afford it is NOT the reason.

mechone, you're right, the $2000 is not tax free. And it seems like Trudeau's treating everybody who lost their job after March 15 the same, i.e. they're on CERB while it's around.

Here's a Q&A from gov't site: "…..you will receive $500 per week, regardless of what you may have been eligible to receive through Employment Insurance. However, you retain your eligibility to receive for Employment Insurance after you stop receiving the Canada Emergency Response Benefit, and the period that you received the CERB does not impact your EI entitlement." So does that mean EI is basically on hold during CERB and then you start it only when CERB is done? If so, that's not a bad deal, I guess. And I suppose it works in reverse for those who apply for EI but would have been entitled to less than $500/week, they're ahead.

savemoresaveoften, I can see the merit of what you're saying, makes sense. But if the recipients pay what they receive back then that means those recipients who lost work time/wages due to no fault of their own end up losing money (i.e. those lost wages) due to covid, the rest of us are unscathed.

mechone said
My wife is laid off March 23rd due to the virus and right away applys for EI gets a letter in the mail telling her she will get 5 hundred and change a week for up to 40 weeks with 51 dollars taken off for income tax 461 net . Then 2 weeks later Justin moves everyone that applied for EI to new program 2000 a month with no tax taken off . He's my beef she would have got one weeks pay in march as they waived the waiting period and Apirl has 5 weeks pay periods in it ,so she would have gotten 461x 6= 2766 net , 306 dollars tax paid. Instead she gets 2000 and no tax taken which I can assume she will get a T4 slip and owe tax on it . She has never collected EI in 25 years of working . This government has pulled a fast one on Canadians that have paid into the system . If she gets a cheque in May that's now 4000 that tax is owed on . She would have been further ahead on EI. Just my opinion ,maybe the 2000 is tax free ,but I can't see it  

my understanding is

1) neither EI or CERB are tax free. You rec CERB no tax deducted but will get a T4 next year and have to include it when you file. Whether its tax free or not depends on your total income that year.

2)Isn't CERB $2000 per 4 weeks and not per month ? If so your wife's hit is minimal

Lastly given the amount of claims the government have to process, I can see why they move everyone to CERB only and whoever applies will get the funds for now.
Unfortunately ur wife seems to be negatively affected but in the grand scheme of things, there is no solution that fits all.

Bill said
I haven't kept up on this and somebody asked me a question about CERB today, just wondering if anybody knows.

To qualify for your first payment for your first 4-week period it now says: "You have stopped or will stop working, or you are working reduced hours due to COVID-19, and you don’t expect to earn over $1,000 in employment or self-employment income for at least 14 days in a row during the 4-week period".

So, for your first 4-week period, the way I read this is you could make your full wages for 2 weeks, then make $1K working reduced hours for the next two weeks and you'd qualify for the $2K CERB for that first 4-week period. Do I have it right?  

@Bill, it's a good point, and I wondered about that as well. The wording of the CERB benefit rules is worded just wide enough to create, I think, some unenforceable loopholes. If someone had occasional earnings that they realistically, in good faith, didn't expect to exceed $1,000 in that four-week period, they could argue (or, more accurately, their tax lawyer could successfully argue fairly easily) that they were within the letter and spirit of the regulations.

I think the federal government is going to have problems trying to collect on any overpayments, not just because of the bad PR they'll take for going after people who legitimately needed it.

But that's all the degree to which the CRA decides to audit and try and enforce and collect on potential overpayments. I think obvious overpayments like collecting EI+CERB or CERB+CESB during the same period, but those wishy washily-worded ones about the $1,000 maximum earnings from employment will be extremely difficult to enforce. In short, I expect the CRA to take a shit kickin' in the Tax Court of Canada over that. 😉

Cheers,
Doug

I'm no expert, but that's what it sounds like to me too, Bill.
After the first set of rules came out, there were numerous complaints from people with customarily irregular employment situations which resulted in some changes. I presume this was part of the result.

I know someone who recently received a royalty cheque and who is also receiving CERB. He is self-employed and has had no work since covid started. The royalty cheque was for less than $30 and covered a five year period because that's how the original contract was set up. Under the original rules, this would have disqualified him from CERB for the entire month.