Outstanding COVID-19 Benefit Debt Halved to $5.56 Billion, CRA Reports
The Canada Revenue Agency reports that outstanding debt from ineligible recipients of COVID-19 benefits has dropped to $5.56 billion as of July 31, down from over $10 billion in November 2025.
As of July 31, the Canada Revenue Agency (CRA) reported that $5.56 billion in COVID-19 benefits remains outstanding from individuals who were deemed ineligible for the payments. This figure represents a nearly 50 percent reduction from the more than $10 billion in debt reported by the agency in November 2025.
The CRA originally distributed approximately $14 billion in pandemic-related financial support to individuals who did not meet the income requirements for programs such as the Canada Emergency Response Benefit (CERB) and the Canada Recovery Benefit (CRB). The majority of these ineligible payments were issued under the CERB, which was active from March to October 2020 and provided $2,000 every four weeks to eligible applicants, or the CRB.
Since the CRA began informing ineligible recipients that repayment was due in 2022, about $3.671 billion has been repaid. As of July 31, the agency is owed $2.91 billion related to CERB payments and $1.81 billion related to CRB payments. In comparison, older data indicated that as of Nov. 30, 2025, the CRA was owed $5.41 billion on CERB and $3.2 billion on CRB.
The reduction in total debt is attributed to a combination of factors, including repayments, changes in eligibility determinations, and writeoffs for individuals facing permanent financial hardship. The CRA can recommend debt writeoffs to Employment and Social Development Canada (ESDC) in cases of permanent hardship. However, written-off debts are not cancelled; the Crown retains the right to recover the amount owing in the future.
The government allows for interest-free repayment over time and employs a flexible collection approach. Despite this flexibility, the CRA may take legal action against taxpayers whose debt remains unpaid despite having the ability to pay in full.