The first eligibility period of the Canada Recovery Benefit (CRB) was from September 27 to October 10, 2020. Since the program states that the Canada Revenue Agency (CRA) will stop payments after 13 eligibility periods or 26 weeks, many Canadians are worried.
Those who rely on CRB and are still unable to find work until the present will exhaust their benefits on March 27, 2021. Larry Rousseau, executive vice-president at the Canadian Labour Congress (CLC), expressed concern that workers in hard-hit sectors won’t have full-time hours or work by March, or even the summer.
On February 19, 2021, Canadian Prime Minister Justin Trudeau made a timely announcement. The $1,000-every-two-weeks aid will continue past March. Affected Canadians will have 12 additional weeks of access to CRB. Instead of the maximum 13, the eligibility period extends to 19 or 38 weeks.
Eligibility criteria
The CRA will approve a CRB application only if an applicant meets all conditions. Make sure you’re not employed or self-employed due to COVID-19 when you apply for a two-week period. You can also apply for CRB if you had a 50% reduction in your average weekly income versus the previous year due to COVID-19.
Similarly, you must be applying for CRB because you do not qualify to receive Employment Insurance (EI) benefits. The CRA will deny your application if you did not apply or receive the following:
- Canada Recovery Caregiving Benefit (CRCB)
- Canada Recovery Sickness Benefit (CRSB)
- Short-term disability benefits
- Quebec Parental Insurance Plan (QPIP) benefits
Regarding income requirements, your earnings in 2019, 2020, or 12 months before your CRB application date is at least $5,000. Bear in mind that voluntary resignation for a job on or after September 27, 2020, is outright rejection. You must have a valid or reasonable reason why you quit your job.
Benefit amount
The CRB amount and payment scheme will not change because of the extension. Hence, the CRA will disburse $900 ($1,000 minus 10% withholding tax) per two-week period. If you’re filing your tax return for the income year 2020 and include the COVID benefits you received last year, the CRA will provide you with a T4A tax slip before March 10, 2021.
Financial cushion
If you had been saving your pandemic money, you could can build up your financial cushion through dividend investing. The TSX is the marketplace to purchase high-quality income stocks. True North Commercial (TSX: TNT.UN) is a $554.64 million real estate investment (REIT).
The share price is below $10 ($6.44), but the dividend yield is almost 10% (9.18%). A $20,000 investment will generate $1,836 in passive income. In a Tax-Free Savings Account (TFSA), the dividends are tax-free.
True North is not one of Canada’s largest REITs, with its $554,64 million market capitalization. Furthermore, its portfolio consists of less than 50 commercial properties. However, the key takeaway and attraction of this REIT is the tenant base.
The lead tenant in 12 rental properties is the federal government of Canada, the CRB provider. Several provincial governments are the lead lessees in other properties. If you’re looking for a stable income stream, True North will not disappoint.
Favourable response
The federal government responded favorably to the calls of labor groups in Canada to extend the pandemic benefits past March 2021. However, the CLC said the eligibility could have been until year-end.
