Would align with how CERB, other emergency benefits are treated
Ottawa is looking to temporarily adjust the treatment of certain deductions with respect to regular Employment Insurance (EI) benefits, including EI special benefits.
This would align with how deductions are treated for the Canada Emergency Response Benefit (CERB) and other federal COVID-19 emergency income benefits.
“Under the current tax rules, EI and CERB income are treated differently when determining tax relief under the Child Care Expense Deduction and the Disability Supports Deduction. EI recipients are not able to deduct eligible expenses against their EI income, whereas CERB and other COVID-19 emergency income recipients can,” says the Department of Finance.
“The proposed changes would amend the Income Tax Act to temporarily allow Canadians receiving EI benefits to make the same claims for the Child Care Expense Deduction and Disability Supports Deduction as COVID-19 income support recipients.”
The change covers income for 2020 and 2021, and also applies to recipients of Quebec Parental Insurance Plan benefits.
In September 2020, the federal government announced that the EI program will be available to more Canadians, including those who would not have qualified for EI in the past, adding more than 400,000 people.