EI and repayment of benefits at income tax time

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What you should know

Whatever the type of benefits you receive, EI payments are taxable income, meaning federal and provincial or territorial taxes, where applicable, are deducted when you receive them.

At the time you file your income tax return, depending on your net income and if you were paid regular benefits, including regular fishing benefits, you may be required to repay some of the EI benefits you received. If your 2018 income from all sources exceeds $64,625 you will be required to repay 30% of the lesser of:

  • your net income in excess of $64,625; or
  • the total regular benefits, including regular fishing benefits, paid in the taxation year.

Exemption:

You do not have to repay your EI benefits if:

  • your 2018 net income is less than $64,625; or
  • you received less than 1 week of regular or fishing benefits in the preceding 10 taxation years; or
  • you were paid special benefits, such as maternity, parental, sickness, compassionate care or family caregiver benefits. However, if you received a combination of regular and special benefits within the same tax year, you may still have to repay a percentage of the regular benefits received. See example 5 for repayment of benefits.

If you received EI regular benefits including regular fishing benefits, that overlap 2 calendar years, you may qualify for the exemption in the 1st taxation year. However, in the following taxation year you would not qualify for the exemption as there would be more than 1 week of regular benefits paid in the preceding 10 years. See example 2 for repayment of benefits.

Examples of repayment of benefits

Example 1

Tax years 2008 to 2017 Tax year 2018
EI claim
30 weeks regular EI paid

You received EI regular benefits in tax year 2018. No EI regular benefits were paid in the 10 years prior to the tax year 2018. Therefore you are exempt from the benefit repayment.

Example 2

Tax years 2007 to 2016 Tax years 2017 and 2018
EI claim
30 weeks regular EI paid:
2 weeks paid in 2017
28 weeks paid in 2018

For tax year 2017, you would be exempt from benefit repayment as you did not receive regular benefits in the preceding 10 tax years.
For tax year 2018, you would not be exempt from benefit repayment as you received more than 1 week of regular benefits in the 10 year period prior to the tax year under consideration, such as 2 weeks in 2017.

Example 3

Tax years 2007 to 2016 Tax years 2017 and 2018
EI claim
30 weeks EI paid:
2 weeks sickness paid in 2017
28 weeks regular paid in 2018

You received EI regular benefits in tax year 2018 on a claim that commenced in 2017. There were also 2 weeks sickness benefits paid in tax year 2017. As you received only sickness benefits in the 10 year period prior to the tax year 2018, you are exempt from the benefit repayment provisions for tax year 2018.

Example 4

Tax years 2008 to 2017 Tax year 2018
EI claim
45 weeks of regular benefits paid in 2015
EI claim
20 weeks maternity, parental, sickness, or compassionate care benefits paid

You received EI maternity, parental, sickness, compassionate care or family caregiver benefits in tax year 2018. Regular benefits were paid in 2015. Although your net income exceeds $64,625 in 2018, you are exempt from benefit repayment for tax year 2018 as maternity, parental, compassionate care and family caregiver benefits are exempted from the benefit repayment provisions.

Example 5

Tax years 2008 to 2017 Tax year 2018
EI claim
45 weeks of regular benefits paid in 2015
EI claim
22 weeks EI paid:
20 weeks regular
2 weeks sickness

You received EI regular and sickness benefits in tax year 2018. Regular benefits were also paid in the ten year period prior to the tax year 2018. Therefore if your net income exceeds $64,625, you will have to repay a percentage of the regular benefits received for tax year 2018, but not the sickness benefits.

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