The Canada Revenue Agency (CRA) said it sent 441,000 letters warning individuals that they might not be eligible for the Canada’s Emergency Response Benefits (CERB) they have received.
Described as “educational letters” by a CRA spokesperson, these letters are addressed to people the agency says it was “unable to confirm … employment and/or self-employment income of at least $5,000 in 2019, or in the 12 months prior to the date of their application” — one of the key criteria for the CERB program.
The new figure provided by CRA suggests how broad the problem might be. According to federal figures, 8.9 million Canadians applied for CERB. That means nearly 5 per cent of applicants have received letters saying they may not be eligible and could be forced to repay benefits.
Many of those affected have argued that the federal government never clearly defined how the $5,000 amount would be calculated. Some point to the CERB application, which asks if the person received “a minimum of $5,000 (before taxes) in the last 12 months, or in 2019 …” but makes no explicit mention of expense deductions.
In an email to CBC News, CRA said it was clear on how income was determined.
“The CRA considers self-employment income as the net pre-tax income (gross income less expenses). This is consistent with how self-employment income is calculated when dealing with the CRA. To be clear, there has been no change to this position during the lifecycle of the CERB,” a CRA spokesperson told CBC News earlier this month.
The CRA also said the job income requirement was made public in Canada.ca “from the start” on the FAQs page for self-employed and independent workers.
However, a search of CBC News archived internet sites found that information was added about after April 21 – two weeks after the show began accepting applications.
The CRA says that not everyone who receives the letter is required to repay CERB benefits.
Recipients are encouraged to complete their 2020 tax return to help CRA accurately determine the benefits they are entitled to.
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