With the outbreak of the COVID-19 pandemic, many lives have been affected in some or another way. The federal government has introduced several measures to support the people in need. With these measures comes a big relief for the taxpayers during these difficult times. It was imperative for the government to come up with this support. As many people have lost their jobs and businesses. Let’s have a look at these measures.
You will not be charged any penalty for late filing of interest if your 2019 individual (T1) income tax returns are filed and payments are made earlier to September 1, 2020. However, the government is saving the June 1 filing deadline for T1 individuals. Also, the June 15 filing deadline for T1 self-employed individuals to reassure filing returns in time to calculate benefits correctly.
If evaluation of tax return 2019 is not done in time, benefits for July to September 2020 payments will be from 2018 tax returns data. Once 2019 return filed, Canadian Revenue Agency (CRA) may make modifications based on updated income data. No Penalties and interest if payments are done before final deadlines of September 1, 2020. That includes late-filing penalty as long as return is filed by September 1, 2020.
Canadian people will be supported financially during the COVID-19 pandemic, which will include new advantages and credits, and changes to existing ones. You may also get support from other financial programs.
It provides temporary income support for workers who have no income or are earning less than $1,000 in a month due to COVID-19.
It provides a 75% wage subsidy to employers eligible for up to 12 weeks.
It provides short-term financial support for post-secondary students who are eligible, and graduating high school students who are unable to work due to COVID-19.
Eligible individuals who are receiving the GST credit will continue to receive these payments based on their 2018 tax return information.
The small withdrawal requirement from RRIFs will be decreased by 25% for 2020. To recognize unstable market conditions and their influence on many seniors’ retirement savings.
The government has also introduced several other measures that include:
● A six-month interest-free delay on the repayment of Canada Student Loans for all people who are presently in the process of paying back. Similar is for Quebec’s provincial student financial assistance program.
● The Canada Emergency Student Benefit (CESB) will offer support to students and new graduates who cannot find a full-time job or are unable to work due to COVID-19. The eligible students can receive $1,250 a month or $2,000 a month for those with disabilities. This advantage will be available at the beginning of May and will continue until August this year.
● Homeowners with Canada Mortgage Housing Corporation(CMHC) -insured loans that are facing financial problems will be allowed to delay mortgage payments.
● A temporary measures implemented by the CRA to allow an electronic filer to submit an electronic return for their client. It doesn’t matter even if a paper return is already submitted for that tax year but is not prepared.
● The government will provide a one-time $200 refundable tax credit to seniors in Manitoba called the Seniors Economic Recovery Credit. People living in Manitoba who are 65 years of age or above will receive the credit despite income. The senior citizens who file a 2018 tax return as a resident of Manitoba will receive a cheque in May 2020. And all other eligible seniors can declare the credit when they file their 2020 tax return next year.
● For seniors whose 2019 income data is not evaluated, extension in Guaranteed Income Supplement and Allowance payments will be given. It will help to ensure there is no delay in payments until October.
Taxpayers should be vigilant when they get a message saying you received a deposit for the Canada Emergency Response Benefit. You may get this either by telephone, mail, or text message. A fraud will claim to be from the Canada Revenue Agency (CRA). It request personal information such as a social insurance number, credit card number, bank account number, or passport number. Be aware of such scams. It is best to have an accounting firm in contact to get your protected from fraud.
These fraudsters may say that this personal information is important. So the taxpayer can get a refund or a payment benefit. Other communications insist taxpayers visit a dummy CRA website. At this site, taxpayer needs to verify his identity by entering personal information. These are scams, and taxpayers should never reply to these fraudulent communications. Also, they should not click on any of the links given by such sources.
If you have any queries about the influence of these changes on you and your taxes, Filing Taxes is here to help. Visit our website for the latest information on how we are ready to help our clients during the COVID-19 crisis and how we can serve you in the best possible ways. Alternatively, you can call us at +1 416-479-8532 too.