Canadians were held in suspense in late September 2020 when access to pandemic benefits was about to expire. Recipients of the Canada Emergency Response Benefit (CERB) thought they would be left behind. Service Canada started accepting applications for the retooled Employment Insurance (EI) on September 27, 2020, but there was no direct replacement for CERB yet.
The anxiety diminished when the Canada Revenue Agency (CRA) began accepting applications for the Canada Recovery Benefit (CRB) and two other recovery benefits. In 2021, the same incident will not repeat.
Prime Minister Justin Trudeau announced the $1,000 bi-weekly CRB payments extension before affected Canadians exhausted their benefits in late March. The good news is that there would be continued support, as the economy and labour market recover.
26 weeks to 38 weeks
Because of Prime Minister Trudeau’s important announcement, eligible CRB recipients can receive the pandemic money for up to 38 weeks instead of 26. Each eligibility period is still a specific two-week period. Likewise, the manner of payment is unchanged.
CRB is for employed or self-employed individuals who do not qualify for EI benefits. When you apply for CRB, you will receive a net amount of $900 ($1,000 less 10% withholding tax) for the period you applied for.
The CRA reminds applicants that CRB does not renew automatically. You must apply for each period separately. Also, you don’t have to take the 19 periods consecutively. Application for benefits can be retroactive, provided the date is 60 days after a period has elapsed.
CRB is available between September 27, 2020, and September 25, 2021. The CRA will stop the payments if you reached the maximum of 19 periods (38 weeks). If you’re eligible to receive the CRB for the entire stretch, you could receive as much as $19,000 — not $13,000 anymore.
To confirm or make sure you haven’t exceeded the number of eligibility periods, you can review your application history in your CRA My Account. Look under the “COVID-19 Support Payment Application Details.”
A better performer than the Big Five
Canadians can receive income support not only from the federal government’s COVID-19 programs like the CRB. If you have the cash you won’t need anytime soon, invest in dividend stocks. Earnings from established income stocks like National Bank of Canada (TSX:NA) could be permanent, not temporary like CRB.
The sixth-largest bank in Canada is off to a great start in 2021 and outperforming its industry peers. The year-to-date gain is 13%, while the dividend is a respectable 3.54%. Market analysts forecast the price to soar 21% to $98 in the next 12 months. Assuming your initial position is $50,000, the corresponding quarterly dividend is $442.50. Hold the stock for 20 years, and your capital will compound to $100,261.27.
The $27.23 billion bank is stealing the limelight away from the Big Five banks. In Q1 fiscal 2021 (quarter ended January 31, 2021), National Bank reported a 25% increase in net income versus Q1 fiscal 2020. Its president and CEO, Louis Vachon, said, “I am very satisfied with our performance, which was driven by strong momentum in all of our businesses.” You can take the cue from there.
Certainty for Canadians
The CRB extension and that of EI plus the two other recovery benefits is welcome news. Canadians will have certainty amid the global pandemic.