By Tommy Osborne

Covid debt

CRA moving to recover $9.5 billion in unpaid Covid recovery debt

Jun 27, 2024 | 9:58 AM

PRINCE GEORGE – The Canada Revenue Agency (CRA) is moving to the next phase of debt recovery regarding overpayments for all Covid-19 benefit programs. As of April 30, 2024, the CRA says there remains a total outstanding Covid-19 benefit recovery-related debt of $9.53 billion, as broken down below:

“Starting in July 2024, the (CRA) will begin issuing legal warnings to individuals who have not responded or cooperated with previous attempts to recover Covid-19 benefit overpayments and have been determined to have the financial capacity to pay,” a statement from the CRA says.

If you are able to pay back the overpayment debt but have not done so, the CRA says legal actions may include garnishment of wages or other income sources, such as a bank account. However, if you are unable to pay back the debt, or would not be able to pay everything back as one lump sum, the CRA says it will work with people to create repayment plans, or offer extended deadline.

“When Covid-19 benefit debts remain unpaid, the CRA follows a process of responsible enforcement. We encourage individuals to follow the directions they receive in any correspondence from the CRA without delay. The CRA will work with Canadians to resolve any debt they may have by entering into a mutually satisfactory payment agreement, based on their ability to pay,” the statement says.

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The CRA added legal action ideally isn’t its first course of action, and it will make several attempts to contact people prior to taking any action. Saying it has “a flexible collection approach,” the CRA encourages you to reach out if you have not paid yet to avoid legal action. If you are already in contact with the CRA and have an agreed upon repayment plan, the CRA says you do not need to reach out again.

“Individuals who are already in contact the CRA and have a payment arrangement in place can rest assured – there is no need to worry about receiving legal warning letters,” the CRA says.

For details on how you can repay, you can visit the Government of Canada’s website here.

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