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How to qualify for EI as a business owner in Ontario?

Employment-Insurance-EI

It can be difficult for business owners in Ontario to qualify for Employment Insurance (EI) benefits because these benefits are typically intended for employees. If they choose to enroll in the EI program for self-employed people, business owners including independent contractors may be qualified for certain special benefits under the EI.

If you run your own company or own more than 40% of the voting shares in your corporation, this program can give you access to exclusive benefits as soon as a year after registration.

Eligibility for Employment Insurance (EI)

You must fulfill the requirements of the benefits for which you are applying to be qualified for these benefits. 

  • You must be a Canadian citizen or permanent resident
  • Be enrolled in the program for at least a year
  • Have  reduced your business’s time by at least 40% for at least one week
  • Have earned a minimum amount of net self-employed earnings between January 1 and December 31 of the previous year.

Steps to Qualify for EI as a Self-Employed Business Owner

1. Register for the EI Program for Self-Employed People

You have to choose to participate in the self-employed EI program. You can register in person at a Service Canada office or online via the My Service Canada Account (MSCA) of the Government of Canada.

You must wait 12 months after registering before you are eligible to receive benefits from Employment Insurance. Before you can become eligible, you must be enrolled in the program and make payments for at least a year.

2. Make EI Contributions

You are required to pay EI premiums as a self-employed person based on your income from self-employment. Up to a maximum annual insurable amount, the premiums are determined as a percentage of your net self-employment earnings. The employee rate and the EI premium rate are the same.

3. Meet Eligibility Criteria for Specific Benefits

a. Maternity Benefits

  • Accessible to those who are either newly pregnant or have given birth and are unable to work due to their condition.
  • Qualified for maternity benefits for a maximum of 15 weeks.

b. Parental Benefits

  • Accessible to anyone taking care of a newborn or recently adopted child.
  • Qualified for extended parental benefits (up to 69 weeks, with one parent eligible for up to 61 weeks) or standard parental benefits (up to 40 weeks, with one parent eligible for up to 35 weeks)

c. Sickness Benefits

  • Accessible to those unable to work due to illness, accidents, or quarantine
  • Qualified for a maximum of 15 weeks of sick leave

d. Compassionate Care Benefits

  • Accessible to those who look after or support a family member who is critically ill and in danger of passing away.
  • Qualified for benefits of compassionate care for a maximum of 26 weeks.

e. Family Caregiver Benefits

  • These benefits are intended for people who give care or support to a critically ill or injured family member.
  • Family Caregiver Benefit for Children (up to 35 weeks) and the Family Caregiver Benefit for Adults (up to 15 weeks).

4. Submit an EI Application

Once you meet the requirements to be eligible for EI special benefits, you will need to apply online via My Service Canada Account (MSCA) or in person at a Service Canada office.

Make sure you include all the information needed, such as your Social Insurance Number (SIN), a description of the work you do for yourself, and any supporting documentation or medical certificates that may be required.

5. Report Earnings and Changes

You are required to keep reporting to Service Canada any changes in your circumstances and your earnings from self-employment while you are receiving EI benefits. Your benefits and eligibility may be affected if changes are not reported.

Getting professional advice from a tax or financial advisor can further ensure compliance and optimize the benefits available to you as a self-employed individual.

If you are a business owner or self-employed individual in Ontario and need expert guidance on qualifying for Employment Insurance (EI) benefits, One Accounting is here to help. Our team of experienced professionals can provide the personalized advice and support you need to navigate the complexities of EI and ensure you maximize your benefits.

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