The extraordinary economic hit caused by the COVID-19 pandemic has governments of all sectors offering unprecedented assistance to affected Canadians.
To clarify the situation, WealthHack.org has compiled a guide to what each jurisdiction is directly offering Canadian whose jobs have been affected.
The Canadian government has postponed the deadlines for Canadians to file and pay their taxes as part of their COVID-19 Economic Response Plan.
- Federal Tax Filing Deadline: The deadline for filing your taxes has now been delayed by one month from April 30 to June 1.
- Federal Tax Payment Deadline: The deadline for paying any taxes owing from now until August 31st has been pushed back until August 31st. Those payments will be due no later than August 31st, including any taxes owing from your 2019 filing.
- Provincial Tax Deadlines
Quebec: The deadline for producing and filing income tax returns has been postponed to June 1, 2020.
For individuals and individuals in business, the deadline for applying balances due related to income tax returns for the 2019 taxation year is postponed to July 31, 2020.
For those who must pay tax installments, the payment of the June 15, 2020 tax installment is suspended until July 31, 2020.
The terms and conditions of the flexibility measures can be consulted in the Information Bulletin published by the Ministère des Finances.
Employment Insurance (EI)
The Canadian government is using the EI program as a key backbone to delivering aid to Canadians who are losing income or employment as the result of the crisis. Updates to the EI programinclude:
- EI Sickness Benefit provides up to 15 weeks of income replacement. It’s available to you if you’re unable to work because of illness, injury or quarantine. More info here.
- Emergency Care Benefit is available for workers without paid sick leave who are sick, quarantined or forced to stay home to care for children. The program pays up to $900 bi-weekly, for up to 15 weeks. Applications will be available as of April 2020 via the Canada Revenue Agency MyAccount Portal.
- Emergency Support Benefit is a program announced in response to the pandemic to support self-employed workers and freelancers. There is very little information about this currently, but the government has committed $5 billion from its recent support package to this envelope. Stay tuned for updates.
- UPDATE (03/25/2020): The Canada Emergency Response Benefit (CERB) has been announced as a simpler and more accessible combination of the Emergency Care Benefit and Emergency Support Benefit. It will provide $2,000 a month for up to four months for workers who lose income as a result of the COVID-19 pandemic, and is available to both salaried / wage earners, as well as contract workers and self-employed workers.
- Canada Child Benefit (CCB) is an existing program to provide pre-tax funding to Canadians with kids under 18. The government is increasing the amount available per child by $300 for one month for eligible recipients that have to stay home from work to care for a child that is unable to attend school because of the outbreak. The benefit increase will be paid out on the May 2020 CCB payment. If you already receive the CCB, you do not need to re-apply, however if you are not yet enrolled, you can do so here.
In a cash flow crisis, many Canadians may struggle to keep up with debt payments including those on their mortgages, credit cards and student loans. Here’s what we know so far:
- Mortgages & Credit Card Payments
The big six Canadian banks have announced that they will provide flexible payment arrangements for personal and business customers that experience pay disruption, childcare disruption due to school closures or illness related to the COVID-19 pandemic.
UPDATE (03/23/2020): While postponing debt payments may help in a cash crunch, it’s possible that you will continue to be charged interest on both your outstanding payments as planned and the overdue interest from the deferrals, as reported by the CBC today. This means you could end up paying more interest overall, and deferring a payment could possibly even have an impact on your credit score.
Contact your bank to see if you are eligible for deferred payments on your mortgage and/or credit card debt, and be sure to find out what the terms are for payment deferrals, and what that means for your overall interest costs.
- Student Loans
The Canadian government has paused the repayment of Canada Student Loans and Canada Apprentice Loans for six months until September 30, 2020, with no accrual of interest. Pending parliamentary approval, these measures will become effective March 30 2020.
Only a few provinces have announced financial relief for students, yet, but here’s what’s available so far.
- Quebec has postponed student loan repayments for six months
- Alberta has postponed student loan repayments for six months
- British Columbia has not announced specific measures, but is working on it
As part of a multi-billion dollar relief program, Canada is giving out over $10 billion in loans to individuals and businesses.
- COVID-19 Emergency Loan Program for Canadians Abroad is an emergency loan of up to $5,000 to help you return to Canada and to cover your short-term needs while you work toward returning. More info available here
- Business Credit Accessibility Program (BCAP) is available to entrepreneurs that own and operate a viable business. These are low to no interest loans coordinated through Export Development Canada (EDC) and the Business Development Bank of Canada (BDC) that can help you continue to operate your business in a cash crunch. More info here.
If you are over 71 and have a registered retirement income fund (RRIF) which can include an RRSP, Canada is reducing the required minimum withdrawals by 25% for 2020.
The Canadian and provincial governments already offer a wide range of services and benefits to Canadians depending on where you are and your specific circumstances or situation.
Use the Benefit Finder to see if you qualify for any additional programs or support.
Here’s a list of provincial-level resources in response to the COVID-19 outbreak. Only a few of these resources currently include specifics about local economic programs intended to help Canadians through the crisis, but we’re hopeful that updates will come in the days and weeks ahead.