The debt relief programs of Canada since the COVID-19 pandemic began had been supporting individuals and families in enduring the global crisis. It also launched programs for businesses, sectors, and communities.
Debt relief refers to measures to reduce or refinance debt to make it easier for the borrower to repay it.
In Bloomberg’s recent Covid Resilience Ranking, Canada ranked 7th among 53 countries in handling the social and economic impact of COVID. Canada is considered an “MVP” when it comes to “containing the virus’ spread, rolling out vaccination, fighting delta or reopening the economy.”
Continue reading to know more about what Canada offers programs to help you and your family resolve your debt situation.
Employment Insurance (EI) program
The government made temporary changes to the Employment Insurance (EI) program for Canadians struggling and needing financial assistance. The minimum benefit rate for EI clients is $300 per week before taxes, in most cases for claims starting between September 26, 2021, and November 20, 2021.
Those who are not qualified for EU or those who received the maximum number of weeks of EI regular benefits could still apply for Canada Recovery Sickness Benefit or Canada Recovery Caregiving Benefit.
Canada Recovery Benefit
Although this program ended on October 23, 2021, the government is proposing Canada Worker Lockdown Benefit. This would give $300 a week to eligible workers who could not work due to a local lockdown anytime between October 24, 2021, and May 7, 2022.
Eligible workers include those who were not employed or self-employed or had their salary reduced by at least 50% due to the pandemic or were not eligible for Employment Insurance (EI).
Canada Recovery Sickness Benefit
If you have incurred debt after acquiring COVID-19, you may avail this debt relief Canada covid for workers in Canada. It gives $500 ($450 after taxes withheld) weekly (maximum of four weeks) for employees who:
- failed to work for at least 50% of the week because they had COVID-19
- are quarantined for reasons related to COVID-19
- have underlying conditions, are undergoing treatments, or have contracted other sicknesses that, in the opinion of a medical practitioner, nurse practitioner, person in authority, government, or public health authority, would make them more susceptible to COVID-19.
Currently, the government recommends extending the Canada Recovery Sickness Benefit until May 7, 2022. It also likes to increase the maximum duration of this benefit by two weeks (six weeks total).
Canada Recovery Caregiving Benefit
The government also provides financial support to the workers’ families. The CRCB gives $500 ($450 after taxes withheld) for up to 42 weeks per household for workers:
- Could not work for at least 50% of the week to take care of a child below 12 years old or a family member because schools, day-cares, or care facilities are closed due to the pandemic
- because the child or family member is sick and/or required to quarantine or is at high risk of severe health implications because of COVID-19.
It was recommended to extend the Canada Recovery Caregiving Benefit until May 7, 2022, and increase the maximum duration of this benefit by two weeks (44 weeks total).
H2: Debt relief for low-income workers and families in Canada
The Canada Workers Benefit gives a refundable tax credit to help people working and earning a low income. The government is expanding eligibility by making the benefit available to those with incomes up to:
- $32,244 as single Canadians, without children;
- $42,197 as single-earner families; and
- $56,197 as double-earner families.
Low-income workers are now eligible for a tax refund of up to about:
- $1,400 for workers who are single and without children; and
- $2,400 for workers with families.
Mortgage payment deferral
Homeowners struggling to pay mortgage debts may be eligible for a deferral. It is an agreement between you and your lender to pause or suspend your mortgage payments for a certain amount of time.
Aside from the government, there are also personalized debt relief programs in Canada to get back on your feet after the COVID-19 pandemic.