Entrepreneurship & Small Business

CERB help clarification for delayed income

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  • May 10th, 2020 10:10 am
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Deal Fanatic
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Dec 10, 2004
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Vancouver

CERB help clarification for delayed income

Please let me know if you know the answer. One of elder neighbors asked me,but I could not answer. I can tell her the answer when I see her tomorrow. She is in her 60s and she has some kind of etsy type business where she makes something and then ships. Don't have details.
She asked how CERB works when sometimes she received payments 2-3 months later than expected. So in March due to cov19 she made $0, yet received $1600 at the end of March for orders she mad and shipped in January. So essentially that $1600 was for January. She did apply for CERB, but now would like to know if she qualified or not. In my mind she was as it was just a delayed payment, but not sure how government looks at it.
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Jul 26, 2007
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She will get paid within few days by direct deposit or few weeks by check in mail regardless she qualifies or not.

Do explain to the elderly that she must file income tax last year 2019 for $5000+ and rest of the criteria under CERB in canada.ca website.
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Apr 24, 2017
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peteryorkuca wrote: She will get paid within few days by direct deposit or few weeks by check in mail regardless she qualifies or not.

Do explain to the elderly that she must file income tax last year 2019 for $5000+ and rest of the criteria under CERB in canada.ca website.
This is a tricky one because the CERB rules state confusing language. They say both earned and expected to receive which are not the same. A lot of people may have done work and won’t get paid for it now for some time. Or someone may get paid for work done before the outbreak and have not earned $1000 since.
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Jan 21, 2008
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From what a friend was told, they count it by pay period (eg they don't base it on whether you physically worked during that specific CERB period, they base it on if you actually got paid over $1000 or not during that specific CERB period). For example, you worked during a CERB period but were not paid during that period (eg self employed earning commission not yet paid out), you qualify for that CERB period. In another period where you no longer work, but you receive your income from the previous work, even though you no longer worked during that period, because it was the period when you did receive your income, you don't get CERB for that period. Based on what you wrote, theoretically she should not get CERB for that 1st CERB period (right now they are approving everyone but they can/may/will ask for it back later for those that shouldn't have got it). She should start getting CERB for the subsequent 2nd CERB period, assuming she isn't getting more than $1,000 from her income during the 2nd CERB period.
Jr. Member
Oct 8, 2010
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If you are self employed there are two types of accounting. "CASH" and "ACCRUAL" Accrual means it counts as income regardless if you were paid right away since you will be expecting to make this amount in the future. Cash means payments collected at that moment. So it depends on the accounting type they use. So technically if you are receiving payments from clients right now but have made no sales, this month then you should qualify if you are using the accrual method of accounting.
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Jun 30, 2009
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dazz wrote: Please let me know if you know the answer. One of elder neighbors asked me,but I could not answer. I can tell her the answer when I see her tomorrow. She is in her 60s and she has some kind of etsy type business where she makes something and then ships. Don't have details.
She asked how CERB works when sometimes she received payments 2-3 months later than expected. So in March due to cov19 she made $0, yet received $1600 at the end of March for orders she mad and shipped in January. So essentially that $1600 was for January. She did apply for CERB, but now would like to know if she qualified or not. In my mind she was as it was just a delayed payment, but not sure how government looks at it.
My understanding is that for self employed, she would have needed $5000 in self employment income in 2019, or within the 12 months prior to March 15, 2020. She would need to prove that she did in fact receive this self employment income if audited.

Her receiving the $1600 delayed should have no effect on her claiming CERB as it wasn't earned in March. She expected to receive payment in January, but the payment has now arrived later. That doesn't change the fact that she earned it in January. As long as she isn't actively working and shipping out orders, she will probably be fine.

An issue that is coming up in forums on other sites is the self employed individual who sent out invoices expecting to be paid at the end of February for work done in February. They are now starting to receive payments delayed due to their clients dealing with covid cash flow issues. If their clients pay them $1500 a month for the next 7 months, and it were interpreted as if they earned that $1500 each month, then that individual wouldn't be eligible for CERB. Their ability to survive with daily needs would be called into question.

Tangent: Anyone who is questioned for claiming CERB and then subsequently denied, will have the ability to appeal and challenge the ruling. From the way things seem to be going, especially with the CEWS (wage subsidy being extended), I doubt the government will be challenging those attempting to claim CERB for survival. It really doesn't cover a whole lot.

Where people will be challenged successfully by the government will be those who are still employed or who have gone back under the CEWS and as such their employer is currently reporting their employment via payroll taxes. Those people will be denied as it can be proved they didn't qualify for CERB.

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