Tax and personal relief in Canada for COVID-19

0
401

Tax Question:

Is there any tax relief for individuals in Canada with COVID-19 pandemic?

Facts:

Here are some of the significant announcements made this week:

  • Coronavirus (COVID-19) outline
  • Temporary Income Support for Workers and Parents

Discussion:

Here are some of the significant announcements made this week.

  1. Personal Tax Deadlines

For individuals (other than trusts), the T1 personal tax return due date is deferred until June 1, 2020 from the original date of April 30. However, you should still file early if you are expecting a refund or you are receiving GST credits or Canada Child Benefits to ensure that the amounts are correct for the next benefit year.

  1. Personal Tax Balances

For individuals, if you owe taxes or instalments, no interest or penalties will accumulate on the balances until after August 31.

  1. Trust Deadline

For trusts that have a taxation year ending on December 31, 2019, the T3 trust tax return filing due has been extended to May 1, from the original date of March 30.

  1. Employment Insurance (EI) Benefits

Government is waiving the one-week waiting period for individuals that are in “imposed quarantine” effective March 15, 2020. They are also waiving the requirement to provide a medical certificate from your doctor in order to claim EI sickness benefits.

  1. Emergency Care Benefit

This is a new benefit introduced by the government which will provide up to $900 bi-weekly for up to 15 weeks.

Benefit would be administered through the Canada Revenue Agency (CRA) and provide income support to:

  • 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 or daycare 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

  1. Work share EI program

An old program that has been revived to allow partial layoffs and for EI to partially cover employee wages. For example, you could go to an 80% work week and EI would cover 20%. The information is still referring to old programs in lots of places. Please check with your employer.

  1. Mortgage Deferral

The government is working with the large banks and institutions to help support individuals which include a 6-month payment deferral for mortgages. This will be on a case-by-case basis for individuals who are experiencing financial hardship so please check with your financial institution.

We have not found any useful information about this on government sites but have spoken to mortgage professionals that are aware of the program. It is very helpful if you know your banker on a first name basis.

Grant Gilmour, BSc (Hons), MBA, CPA, CA, CICA – ITC
Partner, Gilmour Group CPA’s
Email: faqs@gilmour.ca
Disclaimer: The information contained in this article is intended solely to provide general guidance on matters of interest for the personal use of the reader, who accepts full responsibility for its use. While we have made every attempt to ensure the information contained in this article has been obtained from reliable sources and accurately described herein. SW Media Group and Gilmour Group Incorporated is not responsible for any errors or omissions, or for the results obtained from the use of this information. Before taking any action that might affect your personal and business finances, you should consult a qualified professional advisor.