Posted by & filed under Personal Tax.

Description: The Canada Revenue Agency – the CRA – is sending warning letters to 213,000 Canadians telling them that they may have been paid overpaid by the Canada Emergency Response Benefit (CERB) program. Those who have been paid too much will not have to pay the surplus back immediately, thanks to a government moratorium on CRA collections during the pandemic. The CRA stressed in the warning letters, however, that those in receipt of over-payments may want to clear the matter up before December 31. Otherwise, the surplus amount will be considered taxable in 2020.

Date:  November 18, 2020



Discussion points:

1) Do you know anyone who received the CERB? Were they aware that the CERB would be subject to taxation?

2) What do you think may be the main causes for these over-payments?

3) One of the subjects in Chapter 10 of Wiley’s Financial Accounting: Tools for Business Decision-Making is the handling of employer deductions for various payroll liabilities. Do a little research to determine whether or not income tax was deducted from the CERB payments, just like it would be from an employee’s pay cheque.

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