Canada Revenue Agency: Key COVID-19 Benefits for Individuals

The Canada Revenue Agency has declared several measures to support Canadians through the harsh times of the COVID-19. Here’s a summary.

| More on:
Family relationship with bond and care

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

The coronavirus pandemic has done monstrous damage to businesses as well as to individuals. Business activities will be quite slow to recover, even if lockdowns are gradually releasing. To offset the economic impact, the Canada Revenue Agency has declared several measures so far.

Let’s take a look at some important COVID-19 benefits for individuals.

Canada Emergency Response Benefit

The Canadian government announced financial support of $2,000 for a four-week period for those eligible workers who have lost income due to the pandemic. The benefit is taxable and can be extended for up to 16 weeks.

However, those who are not eligible or receiving more than one CERB payment might have to return the payments when tax-reporting time comes next year.

Canada Emergency Students Benefit

This is financial support to post-secondary, recent post-secondary, and high-school graduates who are not finding work due to the COVID-19.

From May to August 2020, the payment for eligible students is $1,250 for a four-week period. That extends to $2,000 if a student has a disability or has dependents.

Importantly, the benefit is only for students who do not qualify for the CERB or employment insurance.

One-time aid to seniors

As additional aid to seniors, any senior eligible for the Old Age Security (OAS) pension will receive $300, while those eligible for Guaranteed Income Supplement (GIS) will receive an additional $200. Those qualified for both OAS and GIS will collect $500 tax-free.

The aid came in the wake of increasing living expenses, particularly for seniors, due to the pandemic-driven lockdowns.

Increased child care benefit

The Canada Revenue Agency will provide an additional $300 per child through the Canada Child Benefit for 2019-2020. This is a tax-free monthly payment aimed to provide extra support to parents who have lost jobs due to COVID-19.

The COVID-19 pandemic has led to many businesses’ closures, which has seen a massive surge in unemployment. Although the Canadian government has declared wide-ranging benefits to its people, those will not be sufficient for many.

It is impossible to tell when the next crisis will come, but there will certainly be such situations in the future. What Canadians can do for sure is to better prepare for the next disaster.

Top TSX dividend stock

Canadians who are still working and have time before they retire can create a passive-income stream instead of solely depending on government aid in later years. It can also help avoid having to depend on last-minute options like the CERB.

Top Canadian dividend stocks can create such a reliable, steady income stream for the future. The telecom titan BCE (TSX:BCE)(NYSE:BCE) offers a dividend yield of 6% at the moment, higher than TSX stocks at large. That means if an investor invests $10,000 in BCE, they will receive $600 per year in dividends. Notably, BCE has been paying dividends for the last 140 years.

BCE stock has notably outperformed the TSX Index in the last 10 years. In the last two months, the stock has seen a faster recovery from the COVID-19 crash, and it looks fairly valued at the moment.

With more than 10 million customers, BCE has been generating stable cash flows and thus paying stable dividends. It is a mature company and offers slow but steady growth. Its earnings and dividend stability are more fitting to create a passive-income stream for sunset years.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Vineet Kulkarni has no position in any of the stocks mentioned.

More on Dividend Stocks

edit Back view of hugging couple standing with real estate agent in front of house for sale
Dividend Stocks

Why Real Estate Stocks Are a No-Brainer Addition to Your Portfolio

Real estate stocks, especially REITs, offer some distinct advantages over other types of stocks, making them must-have additions to most…

Read more »

Various Canadian dollars in gray pants pocket
Dividend Stocks

3 Top TSX Dividend Stocks to Buy for Monthly Passive Income

Top TSX stocks with monthly dividends now trade at cheap prices for investors seeking passive income.

Read more »

Canadian Dollars
Dividend Stocks

Create Free Passive Income and Turn it Into Thousands With 1 TSX Stock

If you can't afford to invest, you can certainly create passive income another way and use that to invest in…

Read more »

Payday ringed on a calendar
Dividend Stocks

Canadian Dividend Investors: 2 ETFs That Pay Monthly Income With High Yields

Dividend ETFs often pay out monthly distributions compared to dividend stocks.

Read more »

think thought consider
Dividend Stocks

2 Stocks I Own and Will Buy More of if They Fall

Stocks tend to go up in the long run. Therefore, buying a basket of diversified stocks on dips should lead…

Read more »

Various Canadian dollars in gray pants pocket
Dividend Stocks

2 Oversold TSX Dividend Stocks to Buy for Passive Income

Blue-chip dividend stocks such as Royal Bank of Canada and Manulife Financial pay investors a tasty forward yield.

Read more »

TFSA and coins
Dividend Stocks

TFSA Passive Income: 3 Solid Stocks to Earn $355 Every Month

Looking to earn steady passive income? Here are three solid TSX stocks that can help you earn a worry-free passive…

Read more »

Technology
Dividend Stocks

RRSP Investors: 2 Stocks to Buy in August for Dividends and Capital Gains

RRSP investors can still find top TSX dividend stocks trading at cheap prices today for a buy-and-hold portfolio.

Read more »