Canada Revenue Agency: Are You Eligible for the $2,000/Month CRB?

Christopher Liew, CFA
·3 min read
Question marks in a pile
Question marks in a pile

The Canada Revenue Agency (CRA) has its hands full again after the curtain call of the Canada Emergency Response Benefit (CERB) on September 27, 2020. Applications for the Canada Recovery Benefit (CRB) are now open, and if you meet the eligibility requirements, you could receive $2,000 per month in income support.

The transition of CERB recipients to the Employment Insurance (EI) in the recovery phase has begun. CRB is your alternative if you’re part of the estimated one million or more who won’t qualify for EI. The benefit amount is the same ($500 weekly) and could be up to a maximum of 26 weeks, depending on your circumstances.

Targeted focus

The federal government aims to duplicate the CERB’s success by introducing three recovery benefits that target specific situations. The CRB focuses on employed and self-employed individuals who still need financial assistance after CERB.

Canadian workers who can’t work due to an underlying health condition or are sick but don’t have a paid sick leave can apply for the Canada Recovery Sickness Benefit (CRSB). If you need to do caregiving duties to a child or relative, the Canada Recovery Caregiving Benefit (CRCB) is available.

CRB mechanics

Canada’s minister of national revenue, Diane Lebouthillier, explains that CRB is for people who stopped working due to COVID-19 or for the unemployed whose employment or self-employment income was reduced by least 50% due to COVID-19. You automatically forfeit your eligibility if you quit your job voluntarily after September 27, 2020, without a valid reason.

CRB, CRSB, and CRCB have uniform payments of $500 weekly for up to 26 weeks. The payments are in two-week batches. The CRA will deduct a 10% withholding tax, so the net amount you’ll receive every two weeks is $900. You must file for CRB after the eligibility period has lapsed. Make your application through the CRA, either online or by phone.

A first in the banking industry

Laurentian Bank of Canada (TSX:LB) is a cheap buy today at $27.20 per share. However, income investors will delight in its 5.88% dividend. A $204,500 investment will produce $1,002.05 in monthly passive income. This bank stock can provide a much-needed financial cushion as the pandemic drags on.

A changing of the guard is happening at Laurentian Bank. Effective October 30, 2020, Rania Llewellyn will be the new president and CEO. She will be the first woman CEO to steer a major Canadian chartered bank. Llewellyn last held the position of executive vice president of Global Business Payments at Bank of Nova Scotia.

Laurentian Bank is transforming, and the entry of Ms. Llewellyn will usher a new era. The incoming female CEO plans to develop a strategy for long-term growth and success that meets all stakeholders’ needs and expectations. Her task is challenging, because the bank has long been struggling to find growth.

New eras

Like Laurentian Bank, which is entering a new era, the post-CERB period welcomes another pandemic lifeline. Canadians who can’t switch over to EI will not be left out in the cold. Your income support will continue courtesy of the new CRB. Everyone needs to restart.

The post Canada Revenue Agency: Are You Eligible for the $2,000/Month CRB? appeared first on The Motley Fool Canada.

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Fool contributor Christopher Liew has no position in any of the stocks mentioned. The Motley Fool recommends BANK OF NOVA SCOTIA.

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