Employment Insurance Special Benefits for Self-Employed People
Good news! Service Canada, on behalf of the Government of Canada, is pleased to be able to offer Employment Insurance (EI) special benefits to self-employed people. Until recently, only employees – those who work for others – who qualified for benefits through the Employment Insurance program could receive financial support when they got sick, gave birth, adopted a child, cared for a newborn or newly adopted child, or took care of a family member who was seriously ill. Under the Employment Insurance Act, as amended by the Fairness for the Self-Employed Act, self-employed Canadians and permanent residents – those who work for themselves – will be able to apply for EI special benefits if they are registered for access to the EI program.
Employment Insurance Special Benefits
There are four types of EI special benefits:
- Maternity benefits are for mothers who give birth. These benefits cover the period surrounding the child’s birth (up to 15 weeks).
- Parental benefits are for any parent (mother or father) to care for their newborn or newly adopted child or children. Either parent can receive benefits, or they can share benefits between them (up to 35 weeks).
- Sickness benefits are for people who cannot work due to injury, illness, or the need to be isolated in quarantine because they may be carrying a disease (up to 15 weeks).
- Compassionate care benefits are for people who must be away from work temporarily to provide care or support to a family member who is seriously ill with a significant risk of death (up to 6 weeks). The 6 weeks of benefits can be shared between different family members who applied and are eligible to receive them.
If you are eligible for EI special benefits, you can expect to receive 55% of your average weekly earnings up to a defined annual limit. In 2013, you can receive up to $501 per week, based on the maximum insurable earnings of $47,400 for that year. The amount of your benefits may decrease if you continue to work or if your business generates earnings while you are collecting EI special benefits.
As with any insurance program, you will need to pay premiums. In 2013, for every $100 you earn, you will need to contribute $1.88 in EI premiums up to a defined maximum—the same amount that employees pay. This means the most you will pay in EI premiums for 2013 is $891.12. EI premiums are calculated based on your income tax return. For example, if you sign up for the program in 2013, your premiums will be based on your 2013 tax return.
Eligibility
- You can register if you operate your own business
- If you work for a corporation but cannot access EI benefits because you control more than 40% of the corporation’s voting shares
- You must also be either a Canadian citizen or a permanent resident of Canada.
- You must have earned a minimum specified amount of self-employed earnings during the calendar year before the year you submit an EI claim (for claims filed in 2013, the minimum amount of 2012 income is $6,342).
However, some individuals who work independently and are not hired as employees cannot register for these EI special benefits for self-employed people because they are already eligible to receive benefits through the regular EI program. These individuals include:
- barbers, hairdressers, taxi drivers, and drivers of other passenger vehicles who are not hired as employees but whose employment is insurable under the EI Regulations; and
- fishers who are included as insured persons under the EI Fishing Regulations.
Waiting Period
Once you register, you must wait 12 months after the day you register to make a claim for EI special benefits. For example, if you registered on June 13, 2012, you could apply for EI special benefits on June 13, 2013.
Claims
If you are applying for sickness benefits, you have to provide a medical certificate as proof that you are ill, injured, or in quarantine. If you are applying for compassionate care benefits, you have to provide medical proof showing that a gravely ill family member needs your care or support.
Cancelation of EI Special Benefits for self Employed
By taking part in this EI program, you are registering with the Canada Employment Insurance Commission and agreeing to pay premiums on your self-employed income. If you change your mind, you have 60 days to cancel your registration. If you choose to cancel your registration within those first 60 days, you will not have to pay any premiums. After the 60-day period, you can terminate your registration at any time – as long as you have never claimed any benefits. This termination will be effective at the end of the calendar year, so you will have to pay EI premiums for the entire calendar year. Once you have claimed EI benefits, your participation in the program lasts indefinitely. You will have to pay premiums for the entire duration of your self-employed career, regardless of any change in the nature of your self-employment.
Please let us know how we can help. Whether it is a free no-obligation quote or just a question – we will be happy to provide you with detailed answers.
“We used Olga’s expertise to insure and protect business interest of our company. She also provided us with a very valuable financial advice that benefited our company greatly. Thanks a lot!”
