Canada Emergency Response Benefit (CERB) Repayment

For many who received the Canada Emergency Response Benefit (CERB) and later found out that they either received the benefit in error or they didn't qualify for it, receiving repayment letters from the Canada Revenue Agency (CRA) or Service Canada was a hard pill to swallow. Regardless of circumstances the repayment is inevitable and ignoring the letter will result in further action by the CRA such as interest charges, withholding of refunds and benefits, and in a worst case scenario garnishing of bank accounts. Once you remit the repayment to the government, you will receive a T4A slip from either the CRA or Service Canada for the year the payments were made. CERB repayment amounts are reported in box 201 of the T4A slips.

The timing of the repayment is crucial and can significantly affect your taxes. If you repaid the benefit amount before January 1, 2023, you have the option to allocate the payment to the year the benefit was received or any year after up to December 31, 2022. You also have the option of splitting the repayment as long it does not exceed your total repayment amount.

Repayments in 2020: If you repaid the benefit in 2020, the total repayment amount should have been subtracted from the total benefit you received.

Repayments in 2021: If you repaid your benefit in 2021, you will have three options as to how you can allocate the repayment:

Claim the deduction on your 2021 income tax return

ReFILE and claim the total repayment on your 2020 income tax return

Split the deduction between 2020 and 2021 income tax returns

Repayments in 2022: If you repaid your benefit in 2022, you will have three options as to how you can allocate the repayment:

Claim the deduction on your 2022 income tax return

ReFILE and Claim the deduction on your 2020 or 2021 income tax return for the year you received the benefit

Split the deduction between your income tax returns

If you have not yet received the T4A for your repayment and wish to claim the amount on your income tax return, make sure to keep all repayment slips from the bank in case of an audit by the CRA.

Repayments after December 31, 2022: If you repaid your benefit after December 31, 2022, you can only make the deduction in the year you made the repayments.