The Government of Canada has announced that they will be taking immediate measures to provide financial aid to Canadians facing hardship as a result of the COVID-19 pandemic. The Government will be infusing up to $82 billion into the economy in the form of direct spending and deferred taxes.
In particular, the Government has proposed that low- and modest-income families receive a one-time special payment by early May 2020 through the Goods and Services Tax credit. This will double the maximum annual GST credit payment for the 2019-2020 year. On average, single individuals will receive close to $400 and couples will receive close to $600.
Additionally, families with children may be seeing an increase in their Canada Child Benefit (CCB) payments, by $300 per child.
The deadline for tax filings has also been deferred to June 1, although the Government is encouraging those who are eligible to receive GST credits or CCB payments to file their taxes as soon as possible, in order to get access to the additional funds available under these programs.
The Canada Revenue Agency is also allowing taxpayers to defer payment of any income taxes that become due and owing on or after March 18, 2020 and before September 2020. Taxpayers will be permitted to defer payment of these income taxes until after August 31, 2020.
For families paying mortgages, Canada’s large banks have confirmed that they will be providing customers with flexible solutions, including up a to 6-month payment deferral for mortgages, and an opportunity for relief on other debts. In addition, mortgage insurers including the Canada Mortgage and Housing Corporation (CMHC), will be providing tools for homeowners to defer mortgage payments on homeowner CMHC-insured mortgages, including payment deferral, loan re-amortization, capitalization of outstanding interest arrears and other eligible expenses, and special payment arrangements.
More information about the measures the Canadian Government is taking can be found here: Canada – Financial Aid.
We invite you to contact a lawyer at Lindsay Kenney LLP for any legal questions pertaining to these recent financial measures, or for referrals to accountants to assist in tax filing and planning. Our Family Law Group is experienced in negotiating agreements for the division of the Canada Child Benefit and other tax credits and deductions.