The CERB you receive will be treated in the same way as your total income that entitled you to the CERB. This total income is your total income for 2019 or the 12-month period prior to the date of your application.

Therefore, if your total income that entitled you to the CERB is exempt from income tax under section 87 of the Indian Act, your CERB will also be exempt.

If your total income that entitled you to the CERB is partially exempt from tax, your CERB will also be partially exempt. The CERB will be treated as exempt in the same proportion as the total income of the period that is more advantageous to you.

Examples

The CERB you receive will be treated in the same way as your total income that entitled you to the CERB.

This total income is your total income for 2019 (reference period A) or the 12-month period prior to the date of your application (reference period B).

Therefore, if your total income that entitled you to the CERB in either reference period A or reference period B is exempt from income tax under section 87 of the Indian Act, your CERB will also be exempt. If your total income that entitled you to the CERB is partially exempt from tax in both reference periods, your CERB will also be partially exempt.

The CERB will be treated as exempt in the same proportion as the total income of the reference period that is more advantageous to you. If your total income that entitled you to the CERB in one reference period is partially exempt and the total income in the other reference period is taxable, your CERB will be treated as exempt in the same proportion as the total income of the reference period that was partially exempt. If your total income that entitled you to the CERB is taxable in both reference periods, your CERB will also be taxable.

The CERB is generally a taxable benefit. A T4A tax slip will be made available for the 2020 tax year in CRA My Account under Tax Information Slips (T4 and more). If you received the CERB from Service Canada, you will receive a T4E tax slip at tax time or you may also get your T4E information from My Service Canada Account.

You will need to report any taxable CERB payments you receive on your 2020 income tax return. If you have a balance owing for 2020, your payment will be due on or before April 30, 2021.

The CERB received by a self-employed person will be treated in the same way as their total self-employment income that entitled them to the CERB. This total income is the person’s total self-employment income for 2019 (reference period A) or the 12-month period prior to the date of their application (reference period B). Therefore, if the person’s total self-employment income that entitled them to the CERB in either reference period A or reference period B is exempt from income tax under section 87 of the Indian Act, their CERB will also be exempt.

If the person’s total self-employment income that entitled them to the CERB is partially exempt from tax in both reference periods, their CERB will also be partially exempt. The CERB will be treated as exempt in the same proportion as the total self-employment income of the reference period that is more advantageous to the person.

If the person’s total self-employment income that entitled them to the CERB in one reference period is partially exempt and the total self-employment income in the other reference period is taxable, the person’s CERB will be treated as exempt in the same proportion as the total self-employment income of the reference period that was partially exempt.

If the person’s total self-employment income that entitled them to the CERB is taxable in both reference periods, their CERB will also be taxable.

If you mistakenly received COVID-19 emergency benefit payments, or your situation has changed since you first applied for one of these benefits, you can repay the CRA via My Account, online banking, or mail.

Payment arrangement parameters have been expanded to give people more time and flexibility to repay based on their ability to pay. If you can't make a payment in full, contact the CRA to make a payments arrangement.

Paying back CERB if necessary

If you have tax exempt employment or self-employment income, it’s possible that the CRA does not have the necessary income information on file to confirm your eligibility for CERB.

If some or all of your income for 2019 or 2020 was tax exempt, one way to demonstrate your income eligibility is to complete and submit form T90, Income Exempt From Tax Under the Indian Act, with your tax return. You can easily make a change to your return after filing if you realize that you forgot to include information for a tax deduction, credit, or benefit you're trying to claim and/or you found a missing or new receipt, information slip (like a T4), or other supporting documents. If you have already filed a 2019 or 2020 return but did not include form T90, you can send an adjustment request through My Account, or use the ReFile option on your preferred certified tax software to make a change. Please note that before you can make any corrections, you have to wait until you get your notice of assessment from the CRA.

What is considered employment or self-employment income?

To be eligible for CERB, you must have met all eligibility criteria, including having earned employment or self-employment income of at least $5,000 in 2019 or in the 12 months before the date of your application.

Employment income and self-employment income include the following:

• Gross employment income, such as employment income reported on your T4 information slip;
• Commission income
• Other employment income, such as tips you have declared as income, royalties paid to artists, honoraria (for example, small amounts paid to emergency service volunteers)
• Non-eligible dividends earned instead of payment for work
• Net self-employment income
• Provincial or Federal maternity and parental benefits

The following income types are not employment or self-employment income:

• Pension income, such as payments from your Registered Retirement Savings Plan (RRSP), the Canada Pension Plan (CPP), or Old Age Security (OAS)
• Disability benefits
• Student loans and bursaries
• Family support payments
• Social assistance payments
• Workers’ compensation benefits
• Federal supplements
• Employment Insurance (EI) earnings
• Benefit payments such as the Canada Child Benefit (CCB) or Working Income Tax Benefit (WITB)
• Investment income, such as capital gains, eligible dividends, and rental income

If you received a letter from the CRA informing you that we were unable to confirm that you met the minimum income eligibility criteria for CERB, you may have to return the amounts you received. However, you can still provide documentation to support your eligibility, primarily by ensuring your 2019 and 2020 tax returns have been filed.

The CRA uses information from both the 2019 and 2020 income tax returns to assess eligibility for the CERB and verify that individuals have met the minimum income requirement of $5,000. In situation where these income tax returns do not support an applicant’s eligibility, the applicant may be prompted to provide additional documentation to support their claim. Filing your tax returns is the best way to ensure that the CRA has the information needed to verify income eligibility.

Although the filing deadline has passed, individuals that have not yet filed their 2019 and 2020 income tax and benefit returns are encouraged to do so as soon as possible. Late-filed tax returns can still be used to confirm eligibility for the CERB and the suite of Recovery Benefits.

See Get help doing your tax return on this page for more information.

If you received one of the recovery benefits, 10% of the payment was withheld at source - even if your income is exempt from tax.

You may be able to get part or all of the tax back for payments received in 2020 or 2021 by filing a tax return for that year. You may be eligible if:

• some or all of your income is exempt from tax under section 87 of the Indian Act
• you are registered, or entitled to be registered as an Indian under that Act

This may include filling out Form T90 Income exempt under the Indian Act as part of the return. Or you may be eligible to use a simplified return.

As announced in October 2020, the CRA has implemented up-front verification measures for the suite of COVID-19 recovery benefits to help prevent fraudulent applications and ensure that those receiving the benefits are eligible. On May 31, 2021, the CRA began to gradually expand these up-front verification measures for individuals who have applied to the Canada Recovery Benefits.

If you have been applying for any of the COVID-19 recovery benefits, filing your 2019 and 2020 tax and benefit returns is the simplest way to avoid a potential delay in the receipt of your recovery benefit payments.

Although the filing deadline has passed, individuals that have not yet filed their 2019 and 2020 income tax and benefit returns are encouraged to do so as soon as possible.

If you have tax exempt employment or self-employment income, the CRA may not have the necessary income information on file to confirm your eligibility for the recovery benefits.

If some or all of your income for 2019 or 2020 was tax exempt, one way to demonstrate your income eligibility is to complete and submit form T90, Income Exempt From Tax Under the Indian Act, with your tax return. If you have already filed a 2019 or 2020 return but did not include form T90, you can send an adjustment request through My Account, or use the ReFile option on your preferred certified tax software to make a change. Please note that before you can make any corrections to a tax return, you have to wait until you get your notice of assessment from the CRA for that tax year.

See "If you receive a letter or message from the CRA" on this page if you received a letter from the CRA informing you that we were unable to confirm that you met the minimum income eligibility criteria for any CERB payments you received in the past.

No. The CESB is not considered to be situated on a reserve as there are insufficient factors connecting this income to a reserve. It is available to all Canadians who qualify and are paid from general government funds. This benefit is not paid by First Nations or with money specifically set aside for First Nation individuals.

Furthermore, similar to a social assistance payment or an old age security payment, the CESB is available to all eligible individuals regardless of whether they are First Nation individuals or whether they earned income in 2019 or in the 12-month period prior to the date of their application.

The fact that the recipient is a First Nation individual residing on a reserve is not sufficient to result in the benefit being situated on a reserve, and therefore, it is not exempt from tax under section 87 of the Indian Act.

No. Form T90, Income exempt from tax under the Indian Act, is mainly used to calculate a First Nation individual's total exempt working income (line 4) and net exempt income (line 17) for purposes of the Canada workers benefit. Line 7 of Form T90 E(20) refers to the federal, provincial, or territorial government COVID-19 payments received in the year.

The instruction for what amounts to be entered on line 7 of Form T90 E(20) further clarifies that only the exempt portion of the COVID-19 payments received from the federal, provincial, or territorial government be entered on line 7.

The CESB is not exempt from tax under section 87 of the Indian Act and therefore, should not be included on line 7 of Form T90.