Canada child benefit (CCB) while abroad for less than a year?

[loveofjesus2]

Hello! Question for a family without a Reddit account. This family decided to move abroad for less than a year last year between August 14, 2022 - July 10, 2023 due to various circumstances in their home country. While they were there, their 1 child studied in an international school there, then they came back in July 2023 and put the child back into a school here in Canada. They only have 1 child and qualify for CCB, are all Canadian citizens and filed taxes every year, including when they were away. However, they recently received a notice here saying there is no record of their child registered to a school in Canada for that year so they will need to submit proof of his registration or an explanation of where he was to get CCB moving forward.

In this case, would they have qualified for CCB for 2022-2023? Do they have to return the benefits they got in those 11 months? Just overall confused on what to expect!

 

[athanasius1007]

@loveofjesus2 https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/factual-residents-temporarily-outside-canada.html#:~:text=If%20you%20are%20eligible%20to,CRA%20can%20calculate%20your%20CCB%20.

Maybe start reading there.

Also, I’m not sure if proving your child was in school is part of a CCB eligibility criteria.

https://www.canada.ca/en/revenue-ag...ew/canada-child-benefit-before-you-apply.html

 

[coolboy96]

@loveofjesus2 It doesn't matter if they filed taxes every year, leaving without significant ties to Canada means CCB cannot be collected when out of the country. They would be viewed as a non-resident during that time. Here's one legal opinion from 2018.

CRA cracking down on non-residents claiming CCB

"I explain that the only situations I have ever seen where the CRA is arguing that an individual is a non-resident, is where they have very low income and are claiming eligibility for the “Canada child benefit” (“CCB”)[1]. Well, lately it appears that the CRA has a project where it is zeroing in on just that type of scenario."

This means CRA created a dedicated audit team just for CCB around 2018. Although it's not a requirement to be registered in a Canadian school, this CRA team is collecting evidence to prove no significant ties. If they're asking for this, they've already decided that there are no ties with employment or other acceptable reasons on CRA's site. They may receive more requests if, say, they also collected the Canada Housing Benefit.

The next step is a judgement notice to repay and perhaps a fine. CCB for one child is about $7500 a year if under 6, about $6000 if older if a low income. If they can't repay the whole amount, they can make a payment arrangement. If they ignore it, eventually their bank accounts could be frozen, wages garnisheed if either parent works and definitely more fines. CRA has a far reach.

If they feel that they do have significant ties to Canada under the government's listed reasons, then hiring a tax accountant/lawyer will help appeal the decision. Might be a good idea to hire one today while CRA is still collecting evidence. It depends if they do feel they fall under one of those acceptable reasons. In Canada, tax accountants typically start at $150 an hour.

Usually one still has to pay back taxes owed despite an appeal in progress. They'll be given a deadline to pay the CCB owed in the letter they will receive soon after CRA receives no proof of education. Since this is a human audit, not an automated computer flag, then my guess is a letter in March with a deadline to repay a month later. For the 2023 CCB amounts, not until April 30th.