CERB repayment


Did you receive CERB based on your small business?

There is a lot of confusion over whether you were really eligible and if Canada Revenue believes you were not eligible then you are asked to pay it back.

The reason for this is that in order to qualify for CERB as a small business you had to among other things make more than $5,000 in Profit in 2019. This was not clear on most of the bulletins about CERB.

Dispute over whether word 'net' specified

The reason CRA is saying MacDonald didn't qualify? It all comes down o the word 'net.'
MacDonald applied based on her gross income for 2019 -before deducting allowable business expenses like baking supplies and a portion of her household heat and electric bills.

But the CRA says that in order to qualify, small business operators like MacDonald needed to have net earnings for the year over $5,000 - in other words, that much in earnings after expenses were factored in.

You need to be aware that if you did not earn $5,000 after deducting all your expenses CRA may ask you to return your CERB. You should talk to a tax expert but there may be some solutions they can help with. The article (not legal advice) says the following may help.

Sean Casey is the MP for some constituents that were caught in this misunderstanding.

Casey said he's been advising people that they're allowed to file an amendment to their 2019 tax returns, where they could shift some eligible expenses to another tax year or simply not claim them. That, he explained, could boost their declared net incomes and "retroactively make them eligible for the CERB."

So if you were one of the people caught in this misunderstanding. Talk to a knowledgeable tax person and see if this works for you.

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