Canada’s COVID-19 Economic Response Plan

Chris

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Chris Eynon

Financial Advisor, Director

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The Canadian federal government has taken unprecedented action to address the financial impacts of COVID-19. Here are some of the highlights for individuals… note that things are changing rapidly so you should refer to the canada.ca website for the most up-to-date information.

The Canada Emergency Response Benefit (CERB) will provide a taxable benefit of $2,000 a month for up to four months for workers who have lost their employment income due to COVID-19.

If you are sick or quarantined because of COVID-19, you should apply for the Canada Emergency Response Benefit, regardless of your eligibility for Employment Insurance.

Canada Child Benefit The maximum annual CCB payment amount will increase for the 2019–2020 benefit year by $300 per child. This will mean approximately $550 more for the average family.

RRIFs The minimum withdrawal rate for RRIFs will be reduced by 25% for 2020.

Tax filing deadline The filing due date for 2019 income tax returns for individuals has been deferred until June 1, 2020. Any new income tax balances due, or instalments, are also being deferred until after August 31, 2020 without incurring interest or penalties.

If you expect to receive benefits under the Goods and Services Tax credit or the Canada Child Benefit, you are encouraged not to delay filing your 2019 income tax return to ensure that your entitlements are properly determined.

The Canada Revenue Agency has also halted new debt collection for an undetermined period of time.

Special Goods and Services Tax Credit Payment A one-time special payment began April 9 through the Goods and Services Tax credit for low- and modest-income families. The average additional benefit will be close to $400 for single individuals and close to $600 for couples. There is no need to apply for this payment. If you are eligible, you will get it automatically.

Student Loans Payments will be paused from March 30 until September 30, with no accrual of interest.

Mortgages Canadian banks have committed to work with their customers on a case-by-case basis to find solutions to help them manage hardships caused by COVID-19. This includes permitting lenders to defer up to six monthly mortgage payments (interest and principal) for impacted borrowers. Canadians who are impacted by COVID-19 and experiencing financial hardship as a result should contact their financial institution regarding flexibility for a mortgage deferral. This provides flexibility − when needed − to those who need it the most. You are encouraged to visit your bank’s website for the latest information, rather than calling or visiting a branch.