The Canada Revenue Agency (CRA) is intensifying its efforts to recover overpayments from various COVID-19 benefit programs, including the Canada Emergency Response Benefit (CERB), the Canada Recovery Benefit (CRB), and the Canada Worker Lockdown Benefit (CWLB).
Starting in July 2024, the CRA will begin issuing legal warnings and potentially taking legal action against individuals who have not responded or co-operated and are deemed financially capable of repaying their debts.
The agency emphasized that legal measures are a last resort, employed only when individuals fail to engage with the CRA despite having the ability to pay.
“Paying off your debt immediately remains the best way for you to avoid legal measures,” the CRA stated. It also noted that there are no penalties or interest on emergency benefit overpayment debts.
Repayment options
To facilitate repayment, the CRA offers multiple options, including online payments or payments through financial institutions. The agency encourages individuals to promptly follow the instructions in any correspondence they receive.
For those unable to repay their debts immediately, the CRA remains committed to supporting Canadians in financial hardship. The agency urges these individuals to contact them to develop suitable payment arrangements based on their ability to pay. Ignoring legal warnings could lead to avoidable legal actions.
The CRA has been clear that eligibility for COVID-19 benefits relied on self-assessment, subject to later review. The review process began with initial contact letters requesting documentation to support benefit claims, followed by Notices of Redetermination for those deemed ineligible or unresponsive.
Collection efforts began in May 2022
In May 2022, the CRA initiated its collection approach with letters encouraging voluntary repayment. This was followed by collection letters in February 2023 for those who had not addressed their overpayments. Multiple attempts were also made to reach individuals by phone.
The CRA reiterated its commitment to ensuring that benefits are paid only to those entitled while recognizing the financial situations of individuals and families.
“Canadians expect the CRA to ensure benefits are only paid to those who are entitled, and to do so in a manner which recognizes individuals’ and families’ financial situations,” the agency stated.