Canada Emergency Response Benefit (CERB), how it will affect your 2020 taxes, and repayment information

If you received the Canadian Emergency Response Benefit (CERB), it could impact your 2020 income tax return. This impact will be determined by:

  • How much CERB income you received
  • How close your CERB income is to your regular monthly income
  • If you were a salaried employee with taxes withheld
  • If you are self-employed and used to withholding taxes

Because it is a taxable benefit, anyone who received CERB will be issued a T4A slip by the Canada Revenue Agency (CRA).

The CRA is validating applications to ensure that payments are available for people who need them most. If your application needs to be validated, you will have received notice in your online CRA My Account inbox or by regular mail.

Click here to log in to your CRA My Account

You must repay the CERB only if you no longer meet the eligibility requirements outlined for each four-week period. Situations that may lead to repayment include:

  • You earned more income than expected during the time you received the CERB payment
  • You applied for the CERB but later realized you’re not eligible
  • You applied for and got the CERB from Employment Insurance/Service Canada AND from the CRA for the same eligibility period

If you must repay the CERB, repayment options depend on where you applied for it. Click here to find out where you should make your repayment.

If you return a CERB payment before December 31, 2020, and pay it in full, there will be no impact on your 2020 taxes. If you return a CERB payment after December 31, 2020, you will need to pay tax on the full CERB amount you received in 2020.

Please beware of fraudulent emails, texts, or calls about repaying the CERB.

Simplifying the Home Office Expense Deduction

Millions of Canadians are unexpectedly working from home because of COVID-19. Those working from home can already deduct certain home office expenses for tax purposes, but first-time claimants may not be familiar with the rules, and the claim process imposes an administrative burden on employers.

The Federal government announced in their fall economic statement that to simplify the process for both taxpayers and businesses, the CRA will allow employees working from home in 2020 due to COVID-19 with modest expenses to claim up to $400, based on the amount of time working from home, without the need to track detailed expenses, and will generally not request that people provide a signed form from their employers. This measure will help taxpayers access deductions they are entitled to receive and simplify the tax filing process.

Further detail regarding the updated Home Office Expense Deduction will be communicated by the CRA in the coming weeks.

Need to pay us a visit? Please consider calling ahead

As the COVID-19 pandemic continues, we’re doing our best to keep our clients and staff as safe as possible.

We ask that Peterborough and Port Perry clients please consider calling ahead if you wish to drop off or pick up documents so that we can limit the number of people in our offices at one time. Oshawa clients are asked to continue scheduling appointments.

Click here to find contact information for our offices.
We will continue to send relevant updates as they become available. Please feel free to reach out to us using the “I have a question” button below!

Thank you,

Inclusive Accounting Professional Corporation