The Canada Revenue Agency (CRA) recently announced that they are offering relief on the interest charged on certain COVID benefits.
Who is Eligible?
You need to check ALL of the following criteria in order to be eligible:
- Your total 2020 taxable income was $75,000 or less
- You received at least one of the following COVID-19 benefits in 2020:
- Canada Emergency Response Benefit (CERB)
- Canada Emergency Student Benefit (CESB)
- Canada Recovery Benefit (CRB)
- Canada Recovery Caregiving Benefit (CRCB)
- Canada Recovery Sickness Benefit (CRSB)
- Employment Insurance (EI) benefits
- Provincial emergency benefits
- You filed your 2020 income tax and benefit return
- You have a balance owing for your 2020 taxes
If you meet all eligibility criteria and have filed your 2020 tax return, the CRA will automatically apply interest relief on your 2020 taxes owing which means you will not have to pay interest on any amount owing from your 2020 taxes until April 30, 2022.
Please note: Interest relief only applies to your 2020 taxes owing and not on previous or other debts with the CRA.
Late-filing Penalties Still Apply
You still need to file your tax return by the 30th of April, 2021 to avoid penalties. If you file late, you will be charged a 5% late-filing penalty on top of what you already owe, plus an additional 1% for each month (up to a maximum of 12 months).
Interest will start after April 30, 2022 on any amount owing for the 2020 tax year.
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Source: Canada Revenue Agency
