Government Stimulus Packages for Canadians

If you have questions about the Canadian stimulus package I have all the details broken down for you to easily get what you need. Lately, I have been following the announcements of government stimulus packages very closely. I have become addicted to press conferences and can now easily get my daily fix both federally and provincially.

My new daily schedule now revolves around press conferences. In the morning I watch the federal press conference and a provincial one in the afternoon.  

All of my hunger for knowledge is now to your benefit. Below I’m going to outline and provide resources for the federal and provincial government stimulus packages that have been announced.  The news about these programs is changing constantly. The Prime Minister and provincial premiers will continue to make new announcements daily.

Being mindful of these changes, I will continue to keep this post updated with the latest information that is available.

Last updated July 7, 2020

The government of Canada has recently released details on its $82 billion aid stimulus program. And provincial governments are also starting to announce how they will be helping their citizens during this unprecedented time.

Everyone still has bills and needs money for basics such as food and medications.  With the closing of many businesses and laying off (even if just temporary) of so many workers, people are now wondering where their income will come from. 

The goal of all of these government stimulus packages is to keep liquid cash in the pockets of citizens.  

I want to be clear, for some of these measures, this is not a free ride, just a delay or postponement.  Eventually, a lot of these bills will come due and depending on the nature of the stimulus program, the postponement could mean a large bill waiting for you in a few months’ time.

Federal Government Stimulus Package

There were many things announced on March 18, 2020, a part of the $82 billion stimulus package.  Since then there have been multiple announcements outlining the details of the government stimulus package. The information below is the most current updated government stimulus packages.

Below I am only going to outline the programs that will directly (and immediately) impact you.  I am not going to detail programs announced for businesses.  If you are interested in these programs, please check out the government of Canada website.

Canada Emergency Response Benefit

This is the cornerstone of the financial assistance component of the Canadian government stimulus package. Because of this it is continuously being updated and improved upon to be more inclusive.

This benefit replaces the previous Emergency Care Benefit and Emergency Support Benefit. It sounds like when this when to parliament it was simplified which makes it much easier to understand and benefit from.

On June 16, 2020, the prime minister announced that the Canadian Emergency Response Benefit (CERB) will be extended for another 8 weeks into the summer.

The CERB is a taxable benefit of $2000 every 4 weeks for up to 24 weeks.

This is 8 weeks longer than the previous 16-week announcement. The Canadian Emergency Response Benefit is now worth up to $12,000 pre-tax dollars.

The CERB will be available from March 15, 2020, to October 3, 2020 with the last day to apply to be December 2, 2020. This time period is a total of 28 weeks yet the benefit will only be paid for 24 weeks in total.

You will also have to re-apply for the benefit every 4 weeks as it does not automatically roll over for the 24 week eligibility period.

It is important to note that the Canadian Emergency Response Benefit is a taxable benefit but tax is not being taken off at the source. What this means is, you will have to report the CERB as income on your 2020 tax return and pay tax on it then.

You are eligible for the CERB if you:

• Must stop work due to the pandemic and are not eligible for paid sick leave or any other income support
• Are sick, quarantined or are taking care of someone who is sick
• Are a parent with a child (or children) who require supervision due to school or daycare closures
• Are still employed but there is no work and your employer has told you to stay home
• Are self-employed or otherwise not eligible for employment insurance

New eligibility criteria announced April 15, 2020:

• If you earn less than $1000 a month you can still apply and qualify for the CERB
• Seasonal workers who have exhausted regular Employment Insurance and are unable to take on seasonal work due to the pandemic
• Anyone who has exhausted their regular Employment Insurance benefits and are still unable to find work due to the pandemic

Applications for the CERB will be available through MyCRA and My Service Canada. Apply to one of these sites, not both. Once your application is complete you can expect to receive payment within 10 days; faster if you are set up for direct deposit.

Because of the speed in which this payment will be made, it may be a better idea to apply for this program instead of employment insurance; if you qualify for employment insurance. But it is important to note you cannot apply for both programs; it’s one or the other.

It is also important to note that applying for and receiving the Canadian Emergency Response Benefit does not impact your Employment Insurance entitlement. This means that you could collect the CERB for 16 weeks and then apply for your EI entitlement.

For those of you wanting to reach out by phone, here are the toll-free government numbers dedicated to applications for this program: 1-800-959-2019 & 1-800-959-2041.

My advice would be to make sure that you are set up for direct deposit so that you can get your money as soon as possible and won’t have to wait for a cheque in the mail.

CERB Highlights:

• Up to $2000 every 4 weeks for 24 weeks
• Open to residents of Canada at least 15 years of age
• Must have had at least $5000 of income in 2019 or in 12 months prior to application
• Designated for those who do not qualify for the EI sickness benefit
• Applications currently open

Applying for the CERB

To help facilitate the application process, the CRA has established staggered applications as follows:

• Mondays beginning April 6 – anyone born in January, February, & March
• Tuesday beginning April 7 – anyone born in April, May, & June
• Wednesday beginning April 8 – anyone born in July, August, & September
• Thursday beginning April 9 – anyone born in October, November, & December
• Friday beginning April 10 – everyone

Moving forward, they also plan to use the same scheduled days of the week. Fridays, Saturdays and Sundays will be open to any birth month. Visit the CRA website to apply.

If you are unable to apply online you can apply by phone by calling: 1-800-959-2041 or 1-800-959-2019.

Employment Insurance Sickness Benefit

This is not a new benefit announced by the government but is worth noting here for anyone who qualifies. Although not new, there have been some new adjustments to the program announced by Prime Minister Trudeau.

EI sickness benefits provide up to 15 weeks of financial assistance at a rate of 55% of your income to a maximum of $573 per week.

The government is waiving the one-week waiting period and medical certificate requirement.  This means that once your application is accepted the benefits will begin paying from the date of application.  Eliminating the need for a medical certificate helps remove that extra strain on the health care system and expedites your application process.

Highlights:

• Waived one-week waiting period
• No medical certificate required
• Up to $573 per week for up to 15 weeks

For more detailed information on how to specifically apply for the Emergency Care Benefits or EI Sickness Benefits check out this post by Boomer and Echo.

GST Credit

There will be a one-time payment through the GST credit plan in early May.  This will double the maximum annual payment for the 2019-2020 benefit year. The government estimates that this will amount to an extra $400 for single filers and $600 for couples who are eligible.

Highlights

• Timing – early May
• Estimated $400 for single filers and $600 for couples
• No need to apply – benefit applied aut0matically

Canada Child Benefit (CCB)

The Canadian government announced that it will be increasing the maximum annual Canada Child Benefit (CCB) by $300 for the 2019-2020 benefit year only.

The maximum CCB for the 2019-2020 benefit year will now be as follows:

• Children aged 0-6 years – $6939/year
• Children aged 6-17 years – 5902/year

The extra $300 benefit amount will be paid in full with their May payment.

Highlights:

• Increase in $300 per child for 2019-2020 benefit year
• No need to apply, the increase will be applied automatically to May payment

People with Disabilities

The government has proposed a one-time payment to people with disabilities who are certificate holders of the Disability Tax Credit (DTC) as of June 1, 2020.

There are currently no details as to when this one-time payment will be distributed to people with disabilities.

The payment has 3 tiers.

• $600 for Canadians who hold a Disability Tax Credit certificate
• $300 for Canadians who are eligible for the DTC and the Old-Age Security pension (OAS)
• $100 for Canadians who are eligible for the DTC, OAS and Guaranteed Income Supplement (GIS)

Eligibility:

• Must be a certificate holder of the Disability Tax Credit as of June 1, 2020.

Student Loans

Effective March 30, 2020, there will be a 6-month moratorium on student loan repayments of Canada Student Loans.  This is a 6-month payment deferral in which interest will not accrue, it is essentially as if time is paused for 6 months on your loan.

Students are not required to apply for the payment deferral it will occur automatically.

As time goes on, more help for students is being announced. The government of Canada will be increasing grants, scholarships, and fellowships for research by $291 million.

Prime minister Trudeau also announced that for the 2020-2021 school year the government will be doubling student grants. They will also be creating 76,000 summer jobs specifically for students.

Canada Emergency Student Benefit

This benefit was just announce by Mr. Trudeau on April 22, 2020. The government of Canada is allocating $9 billion dollars for the Canada Emergency Student Benefit (CESB).

This benefit will pay out $1250 per month from May to August and $1750 per month if you have a disability or provide support to someone else.

Eligibility:

• Current post-secondary student
• Post-secondary student who graduated in December 2019
• Students enrolling in post-secondary beginning in September 2020

CESB Highlights:

• Can earn up to $1000 a month and still qualify
• Payments will be backdated to May 1st if benefit is not funded prior to that

Canada Student Service Grant

The details of this grant have not been described, but this grant was announced by Mr. Trudeau on April 22, 2020.

The Canada Student Service Grant will be based on volunteer hours by post-secondary students. The CSSG will be worth from $1000 – $5000 depending on volunteer hours.

Registered Retirement Income Funds (RRIFs)

Due to the volatility in the markets, the government of Canada has announced a reduction in the required minimum withdrawals for registered retirement income funds (RRIF’s) by 25% for 2020.  This is very important if you have older parents who currently have RRIF’s (or have one yourself).

The reduction in required minimum withdrawals will keep more of your money in your fund so that it can grow when the market rebounds.  And yes I believe that the market will eventually go back up.

Stimulus Program for Seniors

The latest announced stimulus program has been directed at seniors. Under the current stimulus program, seniors eligible for Old-Age Security (OAS) will receive an additional $300. And seniors eligible for the Guaranteed Income Supplement (GIS) will receive an additional $200.

This means that someone eligible for both OAS and the GIS will receive $500. There is no need to apply for this program, the additional funds will be automatic.

These one-time stimulus payments for seniors are tax free.

The Canadian seniors stimulus package will be funded on July 6, 2020. Check your bank account for this one-time payment in early July.

Income Taxes

The tax return filing deadline has been extended from April 30 to June 1, 2020.  There will also be the option to defer any payments due (either this year’s tax or installment payments).  No interest or penalties will accrue on these payments until after August 31, 2020.

What does this mean? That you have until September 1, 2020, to pay any income tax owed. No interest or penalties will accrue until after that date.

Personally, my husband and I are expecting an income tax refund so we have already filed our taxes and are just waiting for our refunds.  It is no benefit to us to delay filing our income tax returns.  Our refund will be directly applied to our emergency fund.

That being said, if you are expecting to owe income tax with your return then it makes sense to delay filing in order to keep that money in your possession as long as possible.

Highlights:

• Filing deadline extended to June 1, 2020
• Deferred payments until September 1, 2020 interest and penalty-free

Canada Emergency Wage Subsidy

This government stimulus program will provide up to 75% of a wage subsidy for qualifying businesses. To be eligible, a business must have had a minimum of 30% decrease in their revenues due to the pandemic. The number of employees a business has does not matter. And charities and non-profits can qualify for the Canada Emergency Wage Subsidy (CEWS).

The subsidy will cover up to 75% of the first $58,700 of income for employees. This results in a maximum benefit of $847 a week. And this can be backdated to March 15, 2020.

With this program, the government is hoping that businesses will be able to keep workers on the payroll and even higher back workers that may have been laid off in the last 2 weeks.

In the announcement, Mr. Trudeau stated that he is “trusting” businesses to “to do the right thing” and pay the extra 25% if they are able to. He also stated that there will be serious consequences for companies that game or take advantage of this program.

Also important to note, employees who qualify for CEWS are not eligible for the Canadian Emergency Response Benefit mentioned previously. Again, it is one government stimulus program or the other.

The specifics of the release date of this program have not been released. But the prime minister suggested that business higher back and pay their employees and use the credit funding (that was previously announced) to do so. Then when the details of CEWS are finalized, employers can use that funding to pay back the credit funding.

Highlights:

• Up to 75% wage subsidy of first $58,00 income earned
• Maximum benefit $847/week
• Application details yet to be released
• Non-profits and charities are eligible
• Business must have had a minimum of 30% decrease in revenue
• Number of employees does not impact subsidy

But Wait, There’s More

Lastly, the government of Canada announced that they have been working with the big 6 banks on providing flexible solutions.  These flexible solutions will be granted on a case by case basis.  

Some of these solutions may include deferrals for up to 6 months.  These deferrals may relate to mortgages, lines of credits, credit cards or other lending products.  But as mentioned earlier, this is not a free ride.  Interest will continue to accrue on these products and will eventually be due.  Payments will also be added to the end of the term and will also eventually be due.

Provincial Government Stimulus Packages

The specific details of each province and territory’s stimulus program is beyond the scope of this post.  For more information on the program that may directly affect you, please see the links below.  You will also want to follow up with these links regularly as program announcements are being made daily.

• British Columbia
• Alberta
• Saskatchewan
• Manitoba
• Ontario
• Quebec
• New Brunswick
• Nova Scotia
• Prince Edward Island
• Newfoundland & Labrador
• Nunavut
• Northwest Territories
• Yukon

Final Thoughts

I know that it feels very doom and gloom right now, but these government stimulus packages are meant to be a bit of a silver lining.  

Are these announced government stimulus programs enough? Probably not. But government officials are aware of this and have eluded to more government stimulus programs being announced in the future.

Now is not the time to be proud.  Now is the time to seek help if you need it. Part of taking control of your time and money means knowing what resources are available to you. The announced government stimulus programs are resources available to you right now.