Claims for expenses and financial losses due to Phoenix: Claim for impacts to income taxes and government benefits

5. Claims for impacts to income taxes or government benefits and credits

The Government of Canada is doing everything possible to ensure that no employee suffers financial losses because of Phoenix.

If you earned salary in 2016 that was not paid until 2017, you might incur a financial loss related to:

  • paying a higher rate of income tax
  • reduced government benefits and credits such as the Canada child benefit

Filing a claim will not impact your pay, since claims are not processed through the Phoenix pay system.

Who can submit a claim?

To submit a claim, you must meet all of the following requirements:

  1. You must be a current or former federal public servant (includes students and casual employees) whose pay is or was administered by the Phoenix pay system
  2. You were owed salary from 2016 that was paid to you in 2017
  3. The time taken to receive your outstanding salary from 2016 exceeded normal service standards

What is your situation?

  • Did you or will you pay too much income tax because your pay issues put you in a higher income bracket?
  • Were your government benefits and credits, such as the Canada child benefit or subsidized day care, lower because once the salary owed to you was paid out, your annual income was greater than usual?

You may be in a unique situation not described here. Our goal is to ensure no one affected by Phoenix suffers financial losses. If you have incurred a permanent financial loss because of Phoenix, fill out a claim and add as much information as you can. Our goal is to correct each situation and we review each claim on a case-by-case basis.

Paying too much income tax

Your income may have been taxed at a higher rate because once the salary owed to you was paid out, your annual income was greater than usual.

Figure 1: Scenario 1 - Marie
Infographic of Scenario 1 - Marie. Text version below:
Figure 1 - Text version

Meet Marie, who was underpaid in 2016 and received that missing pay in 2017. In 2016, she paid a little less income tax than usual. But in 2017, she paid more income tax than usual, because she was in a higher tax bracket.

  • Marie normally earns $90,000 per year (she lives and works in Ontario)
  • In 2016 she was underpaid by $10,000, earning a total of $80,000 in 2016
  • She subsequently received the missing $10,000 in 2017, which bumped her income from $90,000 to $100,000 for 2017
  • Because of this pay problem, Marie paid $922 more in income taxes than if she had been properly paid and taxed in 2016
In dollars $ Normal (no Phoenix issues) Actual (Phoenix issues) Difference
2016 2017 Total 2016 2017 Total
Income 90,000 90,000 180,000 80,000 100,000 180,000 0
Income Taxes -23,136 -23,136 -46,272 -19,817 -27,377 -47,194 922
After Tax Income 66,864 66,864 133,728 60,183 72,623 132,806 -922
Entitlements to government benefits and credits

Your government benefits and credits, such as the Canada child benefit or subsidized day care, may be lower because once the salary owed to you was paid out, your annual income was greater than usual.

Figure 2: Scenario 2 - David
Infographic of Scenario 2 - David. Text version below:
Figure 2 - Text version

Meet David, who was underpaid in 2016 and received that missing pay in 2017. During 2018, he will receive a little less in government benefits because, in 2017, his income was higher than normal.

  • David normally earns $63,000 per year (he lives and works in Manitoba)
  • In 2016 he was underpaid by $10,000, earning a total of $53,000 in 2016
  • He subsequently received the missing $10,000 in 2017, which bumped his income from $63,000 to $73,000 for 2017
  • Because of this pay error, David received $1,020 less in social benefits as a result the higher-than-normal income in 2017
Amount description 2017 (normal) 2017 (Phoenix) Difference

Table 1 Notes

Table 1 Note 1

Estimated using CRA’s Child and family benefits calculator; single income with 3 children

Return to table 1 note * referrer

Normal salary $63,000 $63,000 $0
2016 underpayment $0 $10,000 $10,000
Revised income $63,000 $73,000 $10,000
Social benefits Return to table 1 note * $12,930 $11,910 ($1,020)

Before you begin

Starting in April 2018, employees will be able to submit claims related to impacts to their 2017 income taxes.

Starting in July 2018, employees will be able to submit claims related to their 2018 government benefits and credits (e.g. Canada child benefit, GST/HST rebates, daycare subsidies, etc.). More information will be available soon.

Please read the frequently asked questions carefully for information on how to complete your claim.

How to submit your claim

Your organization has identified a claims officer who can answer your questions, help you fill out the form and guide you through the claims process.

Attach a separate document to your claim if you need to provide additional explanations.

Keep a copy for your records!

Privacy notice statement

The personal information requested in this form is collected under the authority of the Financial Administration Act and will be used for assessing your request in accordance with the Directive on Payments. Refusal to provide the requested information may delay or prevent the processing of your request. The personal information you provide may be shared with the Treasury Board of Canada Secretariat's Claims Office and Public Services and Procurement Canada. Your personal information will be protected, used and disclosed in accordance with the Privacy Act and as described in Personal Information Bank PSU 931 (Accounts Payable). Your information may also be used or disclosed for financial reporting and program evaluation. The information will be retained for seven years following the last administrative action and then destroyed. Under the act, individuals have rights to request access to and correction of their personal information. If you wish to avail yourself of these rights or require clarification about this Privacy Notice Statement, please contact your organization's Privacy Coordinator. If you are not satisfied with the response to your privacy concern, you may wish to communicate with the Office of the Privacy Commissioner by telephone at 1-800-282-1376 or by email at info@priv.gc.ca.

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