The Canada Workers Benefit Gives Eligible Canadians Up To $2,461 — Here's How It Works
Tax season often brings woe to Canadian workers, reminding us of just how annoying paperwork can be and just how small our income may be. On the bright side of all the bureaucracy is the potential to earn a little windfall from the government in the form of tax credits, depending on your employment status, income and disability status, among other things.
The new Canada Workers Benefit (CWB), whose first advance payment is set to go out on July 28, is one such windfall, offering up to $1,428 to eligible individuals and $2,461 to eligible families to supplement lower incomes. Let's take a look at this credit, how you can secure it, and what the Canada Revenue Agency (CRA) does to determine how much you'll get.
Who is eligible for the Canada Workers Benefit?
You are eligible for the CWB if you pay taxes, earn a working income, are a Canadian resident and are 19 or older on December 31 of the year for which you're filing, according to the government's official site.
Full-time students are not eligible for the CWB unless they have an eligible dependant. If you've been incarcerated for at least 90 days of the year, you're also ineligible. The government determines incarceration as being "confined to a prison or similar institution," so if you think this might apply to you, it's worth reaching out to a tax expert to verify your eligibility before you start spending the new money.
For your or your partner's child to be eligible, they'll need to be under the age of 19 and living with you on December 31.
There's an additional supplement for disabled people, who are eligible as long as they have an approved T2201 Form (Disability Tax Credit Certificate) on file with the CRA.
How do you claim the Canada Workers Benefit?
Claiming the Canada Workers Benefit is as easy as following the instructions in the online software you're using to file your taxes, per the CRA's website, but if you're filing a paper return for some reason, you must fill out and submit the Schedule 6 Canada workers benefit form.
To claim the disability supplement, you'll need to file Schedule 6 (again, either through your software or on paper). If you have a CWB-eligible spouse and one of you gets the disability credit, you'll both be able to claim the basic amount as well as you receiving your disability supplement.
But, if you and your spouse are both eligible for the disability credit, only one of you can claim the basic amount. This might sound nonsensical — if both partners are eligible for government funding, and in fact both eligible for EXTRA funding, you'd think the ethical thing to do would be to provide both partners with the basic and the supplemental amounts.
I'm not in charge, though.
How much money does the Canada Workers Benefit give?
For single individuals, the maximum basic CWB amount is $1,428. You'll receive this amount if you make $23,495 or less annually, and as your income increases, the amount you receive goes down. If your adjusted net income is above $33,015, you won't receive anything.
For families, the maximum is $2,461, which is the amount you'll receive if your adjusted family net income is under $26,805. If your net income is above $43,212, you won't receive anything.
The maximum disability supplement for single people is $737, which you'll receive if you make less than $33,018. If your income is above $37,932, you won't receive anything. For families, the maximum you could receive is also $737. That's the amount you'll receive if your net income is under $43,210, and it is gradually reduced as you make more than that amount. If your net income is above $53,037, you won't receive anything.
The specific amount you'll receive is dependent on the CRA's assessment of your "marital status," "province or territory of residence," "earned working income," "adjusted family net income," any "eligible dependant" and your "eligibility for the disability tax credit."
How do Canada Workers Benefit advance payments work?
Because the CRA determines Canada Workers Benefit eligibility based on tax returns, recipients typically only receive the benefit in the year after they were eligible (since the tax return deadline for any given year is in April the following year).
The government has recently changed this, so that CWB beneficiaries will automatically get advance payments based on their eligibility in the previous year. That would mean, for example, that someone who was eligible for the Canada Workers Benefit in 2023 wouldn't have to wait until 2024 to get their rightful money. Assuming that taxpayer was eligible in 2022, the CRA would use that 2022 information to deliver a "minimum entitlement" in 2023 ahead of a 2023 tax return filing in 2024.
With the new measure having received royal assent, the government has said that the new advance payment scheme will take the form of quarterly payments beginning in July 2023 for the 2023 tax year.
When will you receive your Canada Worker's Benefit in 2023?
Thanks to the ratification of the government's proposal, CWB recipients will get their money starting as soon as July 2023.
Unusually, this year, the first CWB payment is going out on July 28, instead of July 12. The next two payments are scheduled to come on October 12, 2023 and January 12, 2024. Then, you can expect payments to fall regularly on the 12 of July, 2024, and October 12, 2024, and to continue in that pattern until someone in the government decides it's time to stop.
If you don't receive your CWB and you know you're eligible, wait 10 working days before contacting the CRA, as delays aren't uncommon. It's also worth noting that when the payment date falls on a statutory holiday or a weekend, the payment is made on the last business day before that date, so you might even receive your CWB early if the calendar permits.
Now, with your newfound knowledge, go forth and accept your government assistance.
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