How to Access Needed Money: Canada’s COVID-19 Economic Response Plan for Consumers

Canada’s COVID-19 Economic Response Plan: for Consumers

The world is experiencing a global crisis that is unprecedented for our generation. Beyond threatening the health and wellbeing of countless individuals, COVID-19 is disrupting markets, trade, travel, and is forcing businesses across Canada to close their doors and lay off employees.

This means many individuals are now facing unemployment and wondering how they will buy groceries next week or if they will be able to meet their next rent or mortgage obligation.

Fortunately, the Canadian Government has made a number of announcements over the past week regarding programs meant to help those affected by COVID-19. Below is a list of the most relevant to individual Canadians.

Canada Child Benefit (CCB)

Beginning in May, the government will be increasing the CCB by $300 per child.

Emergency Care Benefit

Eligible Canadians can receive up to $900 biweekly, for up to 15 weeks. Those who qualify are:

• Workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits,

• Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not qualify for EI sickness benefits.

• Parents with children who require care or supervision due to school closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.

Application for the Benefit will be available in April 2020 and require Canadians to attest that they meet the eligibility requirements. They will need to re-attest every two weeks to reconfirm their eligibility. Click here for more information on the Emergency Care Benefit.

Student Loans

There will be a six-month interest-free reprieve on all Canada Student Loan payments.

Registered Retirement Income Funds (RRIFs)

The government has reduced the required minimum withdrawals by 25% for 2020. This will provide flexibility to seniors that are concerned that they may be required to liquidate their RRIF assets to meet minimum withdrawal requirements.

Income Taxes

For individuals, the deadline to file your income tax return is extended until June 1, 2020. The deadline to pay any balance due for your individual income tax and benefit return for 2019 is extended from April 30, 2020, to September 1, 2020.

For self-employed individuals or those who have spouses or common-law partners that are self-employed, the deadline to pay any balance due for your individual income tax and benefit return has been extended from April 30, 2020, to September 1, 2020.

Keep in mind, if you are likely to be entitled to a refund, receive benefits under the GSTC, or the Canada Child Benefit encourages you should still file your income tax return as soon as possible to ensure your entitlements for the 2020-21 benefit year are properly calculated.

CRA has also announced that collections activities on new debts owed for taxes will be suspended until further notice, and flexible payment arrangements will be available.

GST/HST credit

For those who qualify for the GST/HST, the Government is proposing to provide a one-time special payment by early May 2020 through the GSTC. This will double the maximum annual GSTC payment amounts for the 2019-20 benefit year.

Temporary Wage Subsidy

Eligible employers can receive a temporary wage subsidy equal to 10% of the remuneration paid during a 3-month period to a maximum of $1,375 per employee

Mortgage payments

Chartered banks, as well as CMHC (Canada Mortgage and Housing Corporation), have provided mortgage protection to assist with mortgage deferral up to 6 months as well as relief on auto loans and credit card payments. You should speak with your bank for more information on this.

Stay safe and healthy. Stay home (whenever possible), wash your hands, and keep your distance from those around you. These are stressful times but no one should feel alone with these challenges. We really are in this together.

Powell Associates Ltd. is a Licensed Insolvency Trustee. We are experienced, hands-on insolvency practitioners who understand the personal impacts of major financial stress;

• You won’t be stuck in an assembly line process.

• You will expect and receive prompt responses and resolution of issues from our supportive and experienced team.

• We will review your debt solution options, including filing a consumer proposal or personal bankruptcy.

• We help Canadians with overwhelming debt get fresh financial starts.

Once you file a consumer proposal or personal bankruptcy, we deal directly with your creditors on your behalf. Your unsecured creditors are required to stop contacting you or continuing legal proceedings against you. Contact us for a free consultation.

We offer free consultations to review your financial situation and practical debt resolution options. Contact us to discuss your situation over the phone, a video chat, or in-person in Saint John, Moncton, Fredericton, Charlottetown, Dartmouth, or Miramichi.