COVID-19 benefits provided temporary income support to individuals who were directly affected by the pandemic.
If you received benefit payments that you were not eligible for, you will need to return the full amount you received or arrange to pay what you owe over time. If you can only make a partial payment now, you should contact the Canada Revenue Agency to set up an arrangement to pay the balance of your debt.
This applies to any of these COVID-19 benefits:
- Canada Emergency Response Benefit (CERB) with the CRA: Repayments
- Canada Emergency Student Benefit (CESB): Repayments
- Canada Recovery Benefit (CRB): Repayments
- Canada Recovery Caregiving Benefit (CRCB): Repayments
- Canada Recovery Sickness Benefit (CRSB): Repayments
- Canada Worker Lockdown Benefit (CWLB)
Repayments of the above benefits should be reported on your personal tax return. For example: repayments made after December 31, 2022 should be reported in the tax year you make the repayment.
If you received the COVID-19 Benefits and are now facing insolvency, you may be worried about what will happen to your COVID-19 Benefit overpayments. If you file a consumer proposal or a bankruptcy, COVID-19 Benefit overpayments will be treated as unsecured debt. This means that they will be included in your total unsecured debts and will be discharged by the successful completion of your consumer proposal or bankruptcy.
It is important to note that if you provided false or misleading information when applying for the COVID-19 Benefits, you may be subject to criminal prosecution and would then not be eligible for debt relief for any overpayments.
If you are struggling with debt, it is important to seek professional advice and explore all options available to you. Additionally, if you are a corporation facing insolvency and have received COVID-19 Benefit overpayments, considering a Corporate Proposal service may be a strategic option. Call Kunjar Sharma & Associates Inc., Licensed Insolvency Trustee at 416-975-0910 for a free consultation.