Did you know, July, August & September are the most common months for birthdays in Canada? I know this all too well, as last September, my son was born and the hospital was packed! As a new parent your eligible for maternity and parental leave benefits. You could receive up to 55% of your earnings to a maximum $573 a week
Maternity Leave
Maternity benefits can start as early as 12 weeks before the due date or from the date of birth of your child. Maternity benefits last a total of 15 weeks.
Weekly maximum benefit is up to $573.
Parental Leave
Maternity leave is for the person giving birth. While Parental leave can be taken by either parent. You must choose between two options:
- Standard Parental Benefits
- Extended Parental Benefits
Its important to note that once you start receiving parental benefits, you cannot change options.
Standard Parental Benefits
Up to 40 weeks, but one parent cannot receive more than 35 weeks. Weekly max up to $573
Extended Parental Benefits
Up to 69 weeks but one parent cannot receive more than 61 weeks of extended benefits. Weekly Max up to $344
To be eligible for Employment Insurance (EI) maternity and parental benefits, the applicant must meet the following criteria:
- They are pregnant or have recently given birth when requesting maternity benefits.
- They are a parent caring for newborn or newly adopted child.
- Their regular weekly earnings have decreased by more than 40% for at least one week.
- They have accumulated a minimum of 600 insured hours of work in the 52 weeks before or since the start of their claim or since the start of their last claim, whichever is shorter.
- New parents who are self-employed must be registered with the EI program for at least 12 months before their application in-order to be eligible, and they must also have paid EI premiums for a certain duration of time.
Keep in mind these benefits are taxable, and are added to the total income earned throughout the year. Therefore, when you apply you should request more taxes to be deducted at source, to reflect your approximate tax bracket. This will avoid any surprise when it comes time to file your taxes.
If you have any questions on how being a new parent impacts your taxes, Elite Tax Service is here to help.