Canadian workers were worried about the financial squeeze once the Canada Emergency Response Benefit (CERB) ended. It would be difficult to make ends meet if there were no backstop. The government prepared to transition CERB recipients to the enhanced Employment Insurance (EI) system, although a significant number did not qualify.
The legislation for the new recovery benefits, including the Canada Recovery Benefit (CRB), is now in place. The Canada Revenue Agency (CRA) began accepting applications for CRB on October 12, 2020.
However, besides the start date, there are three important facts you need to know when applying for CRB. You can learn if you qualify to receive the new income support, which is available for one year.
1. For individuals not entitled to EI…
The money will still come in post-CERB for employed and self-employed individuals directly affected by COVID-19 but not entitled to EI benefits. A claimant must have earned $5,000 in 2019 and 2020, or their income was reduced by at least 50%. The CRA will administer the program.
If you are eligible, the CRB provides the same amount as CERB. The difference is that the payments are every two weeks. Also, the deduction of the 10% tax due will be at source. Hence, you will receive $900 net, after taxes, for a two-week period. After the period, and if your situation hasn’t changed, you need to apply again.
2. Receive CRB 13 times
CRB is available between September 27, 2020, and September 25, 2021. An applicant can apply for CRB up to 13 times, or 26 weeks, and receive a maximum of $13,000. You don’t have to take each of the periods consecutively. You may apply for CRB retroactively for any period up to 60 days after that period has lapsed.
3. Automatic disqualification
The CRA is particular about giving CRB only to people who need financial support the most. However, you extinguish your eligibility if you quit your job voluntarily after September 27, 2020, then apply for CRB. You must have a valid reason for resigning.
Earn sturdy income
One passive-income idea in the pandemic is to go dividend investing. If you can afford to invest, purchase a utility stock that pays dividends every month. Apart from the monthly payout, Superior Plus (TSX: SPB) offers a high 5.85% dividend.
A $50,000 stake will produce $243.75 in monthly passive income. It’s like receiving CRB from your savings. The market selloff in March 2020 did not adversely affect Superior Plus. The stock has a gain of 1.04% year to date.
In the pandemic, the $2.12 billion company is demonstrating reliability and strong operational performance. Superior Plus delivers, procures, and markets propane-related products in North America. However, its energy distribution segment accounts for 75% of EBITDA from operations.
Capital-rich Brookfield Asset Management is a major investor at Superior Plus. It bought $260 million worth of preferred shares with the option to convert them to common shares. The company has ample liquidity to pursue future acquisitions. Also, no debts mature until 2024.
Timely reprieve
With the timely launch of CRB in October 2020, CERB recipients get temporary compensation while actively seeking work. The new pandemic lifeline from the CRA is vital to navigating the continuing uncertainties.
