The Canada Revenue Agency says some taxpayers who repaid COVID-19 related benefits in 2020 are getting incorrect tax slips. THE CANADIAN PRESS/Justin Tang

The Canada Revenue Agency says some taxpayers who repaid COVID-19 related benefits in 2020 are getting incorrect tax slips. THE CANADIAN PRESS/Justin Tang

CRA says ‘rare’ error in some tax slips lists repaid CERB as taxable income

‘These repayments can be properly and easily credited to the correct account,’ assures CRA spokesperson

When the COVID-19 pandemic closed schools last spring, crosswalk guard and recent graduate Danny Thomson was encouraged by the Ottawa Safety Council to apply for the new COVID-19 emergency benefits.

But after returning $3,000 in Canada Emergency Response Benefits last year after realizing he was ineligible, he was told by the Canada Revenue Agency that $2,000 has not been repaid and is being considered taxable income for 2020.

The Canada Revenue Agency confirmed this week that some taxpayers who repaid COVID-19 related benefits in 2020 have received incorrect tax slips that wrongly list portions of the repaid benefits as taxable income.

The CRA had previously informed CERB recipients that they must repay the benefit if they earned more income than expected during the four-week payment period, or if they applied and later realized they were ineligible. It also said duplicate CERB payments should be repaid — if recipients applied for and got the CERB from both the CRA and Employment Insurance or Service Canada for the same eligibility period.

CERB recipients who repaid before Dec. 31, 2020, should not have to pay tax on those amounts on 2020 tax returns, the revenue agency’s website notes, with the repaid amounts subtracted from the individual’s benefit amount on T4A slips.

But the tax agency said there is a rare error in which the repayments are credited to a taxpayer’s T1 instalment account instead of their emergency benefits account.

“These repayments can be properly and easily credited to the correct account,” CRA spokesperson Etienne Biram said in a statement.

The CRA said taxpayers should call 1-800-959-8281 to fix incorrect tax slips. It added that it is being proactive and moving the payments to the correct accounts, and that amended tax slips will be issued.

Thomson said three calls to the CRA so far have been unsuccessful as all the agents have been busy each time he called.

Edward Rajaratnam, executive director at EY Canada’s people advisory services, said a phone call to the CRA — preferably in the morning before a queue starts forming on the hotline — is still a better route than a letter, since the error might be difficult to dispute in an online portal.

“My first rule of thumb is, please reach out to the CRA — because if it was a genuine error, they would correct it,” Rajaratnam said.

“(A phone call is ) more personal in nature. Everybody’s situation is different.”

Rajaratnam said he has seen the tax slip issues cropping up across his network, from friends to LinkedIn connections. The first question, he said, is whether the repayment of the emergency benefit was made before Dec. 31. If a taxpayer repaid the benefits in January or February, they’ll have to wait until this time next year to get the adjustment in their 2021 tax filing.

Before filing a complaint, Rajaratnam said it’s also worth checking with your bank to ensure the repayment left your account and the relevant agency received it.

He suggested anyone who repaid benefits before the new year check for errors as soon as the T-slip arrives, rather than leaving it until closer to the tax-filing deadline to catch a miscalculation. That way, Rajaratnam said, there will be time to get a corrected tax slip.

“I wouldn’t suggest anybody to file your tax return without having that (amended T4A slip),” Rajaratnam said.

Rajaratnam said that he’s hopeful the CRA will provide detailed guidance on this issue before the end of April, so people know when to expect their corrected tax slips.

If for some reason, someone notices the error right before the tax-filing deadline and cannot get through to the CRA, Rajaratnam said there is a last resort: Putting the correct amount on the tax filing and including a letter to the CRA explaining why the T4A doesn’t match the tax filing.

But Rajaratnam stressed that it is best not to wait, since the CRA has not yet said if it will offer extensions to deal with these issues.

“This has been a very fluid situation with all their the wage subsidies and CERB benefits,” Rajaratnam said. “I think the CRA is, similar to all other governments, trying to do the best they can.”

The CRA could also be clearer in its instructions and on its website, Thomson says, noting that Reddit message boards on CERB and Employment Insurance are filled with similar anecdotes.

“I know I’m not the only one who’s had this issue, and it’s scary getting a big government letter in the mail,” Thomson said.

“I don’t think I should have to pay taxes on this. Hopefully I can get through to someone to get this fixed.”

This report by The Canadian Press was first published March 2, 2021.

taxes

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

..
Abbotsford nurse at ‘breaking point’ pleads with public to take COVID-19 seriously

Instagram post urges general population to stay home, wear a mask and get vaccinated

The Independent Investigations Office of BC (IIO) (File Photo)
IIO investigating after man seriously injured by police dog during Abbotsford arrest

Independent Investigations Office looking into incident from March 6 in 3700 block of Davie Street

A pack of three T-Rexes were reportedly seen shopping near Winners at the Junction Shopping Centre in Mission. Facebook photo / Carla Jayne.
Pack of T-Rexes spotted prowling, shopping in Mission

Sightings may confirm recent fossil evidence suggesting that tyrannosaurs lived in packs

Westbound Highway 1 traffic near Herrling Island is backed up a long way following a vehicle incident. (Photo/Trish Dunbar)
Pedestrian killed in crash near Herrling Island

Woman in her 50s struck by moving van

Students in the March 2020 Environmental Mind Grind, which was held at Sevenoaks Shopping Centre before COVID-19 restrictions were put into place. This year’s event is being held virtually. (Submitted photo)
Environmental Mind Grind goes virtual for first time

Event open to Abbotsford and Mission students in Grades 6 to 12

FILE – NDP Leader John Horgan, right, and local candidate Mike Farnworth greet one another with an elbow bump during a campaign stop in Coquitlam, B.C., on Friday, September 25, 2020. THE CANADIAN PRESS/Darryl Dyck
B.C. won’t be using random individual road stops to enforce travel rules: Safety Minister

Minister Mike Farnworth says travel checks only being considered at major highway junctions, ferry ports

Welcome to your park sign marks the spot where 84th Avenue will continue east from King George Boulevard to 140th Street as part of a $13 million road project. (Photo: Tom Zytaruk)
Road Rage: Opposition mounts anew to Surrey’s Bear Creek traffic plan

Same place, same project, same fight as Surrey prepares once again to connect 84th Avenue between King George and 140th Street in Newton

A native-to-B.C. wild queen bee (bombus melanopygus for those in the know) feeds on a periwinkle flower. (Submitted/Sarah Johnson, Native Bee Society of BC)
B.C.’s wild bees need messy gardens to survive

The year-long nesting period makes habitat a primary concern for wild bees

FILE – Health-care workers wave to people clapping and yelling thank you to the frontline workers during the 7 p.m.-tribute outside the Lions Gate Hospital in North Vancouver, B.C. Wednesday, April 8, 2020. THE CANADIAN PRESS/Jonathan Hayward
B.C. nurses issue plea for all to follow health orders as hospitalizations spike

Nurses worried about strain COVID-19 is having on hospital capacity, care

University of Victoria rowing coach Barney Williams is photographed in the stands during the Greater Victoria Invitational at CARSA Performance Gym at the University of Victoria in Victoria, B.C., on Friday, November 29, 2019. The University of Victoria says Williams has resigned effective immediately. (THE CANADIAN PRESS/Chad Hipolito)
University of Victoria women’s rowing coach resigns by mutual agreement

Lawsuit filed last summer accused Barney Williams of verbal abuse

Former B.C. premier Christy Clark. (Black Press Media files)
Former B.C. premier to testify at money laundering hearing today

Attorney General David Eby has been added to the witness list as well

Selina Robinson is shown in Coquitlam, B.C., on Friday November 17, 2017. British Columbia’s finance minister says her professional training as a family therapist helped her develop the New Democrat government’s first budget during the COVID-19 pandemic, which she will table Tuesday. THE CANADIAN PRESS/Darryl Dyck
B.C. to table budget that’s expected to deal with COVID-19 pandemic and beyond

Robinson released a fiscal update last December that said the impact of the pandemic on B.C.’s economy was uncertain

Fire consumed a condo development project under construction at 208th Street and 80th Avenue Monday night. Many spectators shared their images. (Daniel Gerstner/Instagram: @gerstner/Special to Langley Advance Times)
UPDATE: Elementary school closed as Langley deals with aftermath of massive condo fire

Firefighters remained on scene at 208th Street and 80th Avenue for much of Tuesday night

Most Read