What you need to know about repaying COVID-19 benefits (including CERB).

March 5, 2021|Updated: October 17, 2024

In 2020, the federal government introduced emergency benefits to help Canadians get the financial relief they need during the COVID-19 pandemic. You might have received an emergency benefit, like the Canada Emergency Response Benefit (CERB), but later found out you weren’t actually eligible for it. Here’s what you need to know about returning or repaying COVID-19 emergency benefits.

Why do I need to repay the benefits I received?

There are three main reasons you might need to repay the COVID-19 benefits you received.

1. You might need to repay a COVID-19 benefit if your situation changed since you applied.

For example, you might have applied for the CERB over the summer, but then returned to work earlier than you expected. If you earned more than $1000 during the period of your claim, you’ll need to repay the CERB amounts you received for that month.

2. You might need to repay a COVID-19 benefit if you made a mistake while applying.

For example, you might have applied for the CERB believing you earned at least $5000 last year, but after reviewing your paystubs for 2019, you discovered that you didn’t make enough income to qualify for this benefit. This is an honest mistake, but it means you’ll need to repay the CERB amounts you received.

3. You might need to repay a COVID-19 benefit if you received more financial assistance than you were eligible for.

You can only receive one emergency benefit from the Canada Revenue Agency (CRA) at a time. For example, if you received more than one of the following amounts at the same time, you’ll need to return your payments:

If you received CERB payments from both the CRA and Service Canada at the same time, you’ll need to return some of your payments.

If you also received any of the following amounts at the same time as the CRB, CRSB, or the CRCB, you’ll need to repay your COVID-19 benefit to the CRA:

Short-term disability benefits
Workers’ compensation benefits
Employment Insurance (EI) benefits
Québec Parental Insurance Pan (QPIP) benefits

How do I know if I need to repay a benefit I received?

You’ll receive a letter from the CRA or Service Canada notifying you if you need to repay any COVID-19 benefit(s) you received.

When do I need to repay my benefits?

There isn’t an official deadline to repay COVID-19 benefits, but the CRA is asking Canadians to return their extra benefits as soon as they can to avoid paying penalties or interest fees in the future.

Keep in mind that if the government has determined that you were not eligible for benefits, they could offset the amount owing against your tax refund if you haven’t paid it back voluntarily.

Will the COVID-19 benefits that I repaid affect my taxes?

The CRB, CRSB, and CRCB were subject to 10% tax withholding. This means 10% was sent to the CRA before you received it, which reduces the amount of taxes you owe. CERB and CESB were not subject to tax withholding.

All COVID-19 benefits will be included in your income for 2020, so they might make your total income higher than last year. This means you could find yourself in a different tax bracket and you could have to pay more tax this year than you did last year.

If you repaid your benefits before December 31, 2020, the income reported on your T4A or T4E slip will be reduced – meaning you won’t owe tax on the benefits you’ve repaid when you file your 2020 return. If you still need to repay COVID-19 benefits to the CRA or Service Canada by January 1, 2021, you’ll owe tax on the full amount of payments you received when you file your 2020 return.

If you repay your COVID-19 benefits in 2021, the amount you repaid (and the taxes you’ve paid on them) will be used to reduce the taxes you owe when you file your 2021 return. This means the taxes you owe from your 2021 return will be lowered by the amount you’ve sent to the CRA or Service Canada to repay your COVID-19 benefits.

Will the COVID-19 benefits that I repaid affect other benefits?

The amount you receive for the GST/HST credit, Canada Child Benefit, and many provincial benefits depends on your net income reported on your return. If you didn’t repay your COVID-19 emergency benefits before December 31, 2020, these will be included in your total income for 2020 and might lower the amount of credit or benefit you receive. On the other hand, if you repay your COVID-19 emergency benefits in 2021, your total income for 2021 will be lower and so your credits or benefits might increase.

I’m self-employed, what should I know about repaying COVID-19 benefits?

In February 2021, the federal government announced that if you mistakenly applied for the CERB based on having a gross income of at least $5000 in 2019 (the amount you made before subtracting your work-related expenses), you’re no longer required to pay back your benefits.

This means you might not have to repay your CERB amounts if:

You’re self-employed,
You earned at least $5000 in 2019 before subtracting your expenses, and
You meet the other eligibility requirements.

If you already repaid your CERB amounts, don’t worry! The CRA and Service Canada will be giving back the repaid amounts to anyone who’s now considered eligible for them. More details about these repayments are coming soon.

How do I repay a COVID-19 benefit?

If you have the original cheque for the COVID-19 benefit you received, you can return the cheque by mail.

If you don’t have the original cheque or if you received the COVID-19 benefit by direct deposit, you can return the amount through your CRA My Account, through online banking, or by mailing a cheque.

Where you need to return your payment depends on the type of benefit you received. Use these links to find out how to repay each of the COVID-19 benefits:

If you have questions about how repaying COVID-19 benefits might affect you, or if you want to prepare and file your taxes but aren’t sure where to start, H&R Block is here to help. Choose from four convenient ways to file: File in an Office, Drop-off at an Office, Remote Tax Expert, or Do It Yourself Tax Software.