EI special benefits for self-employed people – While on EI
7. While on EI
You may be able to work and/or your business may continue to generate income while you are receiving EI benefits. You must always declare on your bi-weekly report all your earnings from your work or any self-employment earnings your business generates for you while you are receiving EI special benefits.
Earnings received while in receipt of benefits
If you work while receiving special benefits for the self-employed and have served your waiting period, you will be able to keep 50 cents of your EI benefits for every dollar you earn, up to 90 percent of the weekly insurable earnings used to calculate your EI benefit amount. This 90 percent amount is called the earnings threshold. If you earn any money above this threshold, we will deduct it dollar for dollar from your benefits.
For more information, visit the Working While on Claim page.
Remember that you must always declare all your earnings in your bi-weekly reports.
Business generating self-employment earnings for you while receiving benefits
As mentioned above, any EI benefit amounts paid or payable to you may be affected if your business generates earnings, including earnings you receive from profits or commissions, while you are in receipt of benefits.
If you have self-employment earnings from services performed Footnote 1 , they are allocated to the week or weeks when the services were performed. A service performed is where an individual is hired to provide a service to an employer or to perform a specific job or piece of work.
If you have self-employment earnings from a transaction Footnote 2 including farming earnings, they are allocated as follows:
- If the earnings are greater than the maximum yearly insurable earnings divided by 52 ($1,021 in 2019), they are allocated to the week or weeks when the work was performed that gave rise to the transaction (you must let Service Canada know when the work was performed that gave rise to the transaction).
- If the earnings are less than or equal to the maximum yearly insurable earnings divided by 52 ($1,021 in 2019), they are allocated to:
- the week the transaction occurred; or
- the weeks when the work was performed that gave rise to the transaction, if you inform Service Canada that the work was performed in more than one week.
A transaction is an agreement to sell goods or products to clients/customers, such as houses, automobiles, paintings, farm products, and crop sales, such as grains, honey, fruit, vegetables, and flowers.
The amount of self-employed earnings that you must declare is the gross amount of self-employment earnings minus any operating expenses related to those earnings.
Operating expenses are the cost of running your business, which could include the cost of items used to earn revenue, such as rent, materials, and gas; and allowances for depreciation on capital investments directly connected to that income. Payments for income tax or for federal or provincial pension plans cannot be deducted as operating expenses.
Protecting Employment Insurance—with your help
Service Canada works to protect the EI program from misuse. One of the ways we do this is by working with employers and claimants to ensure the accuracy of the information we receive. With your help, we can reduce the amount of misuse and ensure that the EI program is used as it should be—as a program that provides temporary financial assistance to individuals who qualify.
A mistake is an unintentional act. We know claimants can make mistakes when filing their reports. Common mistakes include:
- estimating weekly earnings instead of putting in the actual amount earned
- forgetting to declare all the earnings received
- writing or entering the wrong number when reporting earnings, or
- adding the number of hours or amount of earnings incorrectly
Some mistakes can delay benefit payments, while others can affect the amount of benefits you receive—meaning you were paid more or less than you were entitled to receive.
For example, estimating your earnings can have the following effects:
- If you estimated your earnings for one week and your estimate was higher than the earnings you actually received, your benefit amount will be less than it should have been. If this happens, let us know and we will adjust your file to make sure you receive all the benefits to which you are entitled.
- If you estimated your earnings for one week and your estimate was lower than the earnings you actually received, your benefit amount will be higher than it should have been. Let us know if this happens. You will have to repay the excess amount, but we will ensure that repaying it causes no undue hardship. As well, we will adjust your file to reflect your accurate information.
If you notice a mistake on a completed form or report, or if there is a change in your circumstances that could affect your EI claim, tell Service Canada immediately. This will help prevent any future problems with your claim.
If you knowingly withhold information, make misleading statements, or misrepresent the facts to make a false claim for benefits, this is considered misrepresentation. You could face severe monetary penalties or prosecution. This could also affect your future benefits. However, if you disclose your actions to Service Canada before an investigation begins, we may waive any monetary penalties and prosecutions that might otherwise apply.
Consequences of misrepresentation: Interest and penalties
Interest on debt
When EI claimants receive benefits to which they are not entitled, the amount of the overpayment counts as a debt that must be repaid.
Service Canada charges interest on this debt when it results from claimants who knowingly withhold information or make false or misleading representations or statements. However, we do not charge interest on debt that results when Service Canada makes an error in the benefit payment.
The rate of interest is the Bank of Canada average rate plus 3%. Interest is calculated daily and compounded monthly.
A penalty may be imposed on a claimant, an employer, or an individual acting on their behalf in relation to a claim for benefits when he or she has:
- knowingly made false or misleading representations or statements, or
- completed a statement without declaring essential information
There are many situations when a penalty may apply, and the amount could become very high. Depending on the circumstances, the maximum penalty could be up to three times the amount of the overpayment, three times the weekly benefit rate for each incident of misrepresentation, or three times the maximum benefit rate.
Claimants who misuse the EI program and were assessed a violation may need more insurable earnings or hours to qualify for benefits in the future. The required amount rises based on the number and seriousness of misrepresentations that have been recorded in the five-year period before the start of their claims.
Contacts and other useful information
EI Telephone Information Service
The EI Telephone Information Service is an automated telephone service that is available 24 hours a day, seven days a week. If you would prefer to speak to a representative, call 1-800-206-7218 between 8:30 a.m. and 4:30 p.m., Monday to Friday, and press "0." You can get general information about the EI program, the Social Insurance Number (SIN), and your specific EI claim.
Information about your claim is updated every morning from Monday to Friday. To access information about your EI claim, you will need your SIN and access code, which you will find on the benefit statement that is mailed to you after you apply for EI benefits.
My Service Canada Account
My Service Canada Account allows you to view and update your EI information in one place using a secure website. With My Service Canada Account, you can:
- confirm any decision made about your EI application
- see details on your payments and deductions
- sign up for direct deposit
- view and update your personal information, including your mailing address, telephone number, and banking information for direct deposit
- view your EI tax information slips
- view all Records of Employment that your employers have submitted electronically in the last two years
- view and print your Canada Pension Plan Statement of Contributions and benefit estimate
- register to access EI special benefits for self-employed people
How you register for My Service Canada Account
Before you register, you must have your four-digit EI access code (printed in the shaded area at the bottom of your benefit statement). You can then register for My Service Canada Account. It will take about 10 minutes to complete the registration process.
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