Today I am revisiting Mat Leave Monday, because I have some very important information to share. If you are a self-employed Canadian who would like to be eligible for maternity or parental benefits, then you need to act now to opt into the EI system. (Note – If you live in Quebec you are already covered under QPIP as a self-employed person.)
Late last year the Fairness for the self-employed act was announced and passed in Canada. Under this act, self-employed Canadians who earn at least $6000 per year will be eligible to receive special benefits through EI starting in 2011. Special benefits include compassionate leave, sickness leave, maternity leave and parental leave. If you do not collect benefits, you will have the option of opting out at the end of any calendar year. Once you collect benefits, however, you must contribute to EI for as long as you remain self-employed.
How does one opt in? Service Canada’s information on special benefits for the self-employed states that the opt-in period began on January 31. To sign up you need to register for a My Service Canada Account. If you want to be eligible to receive special benefits beginning in January, 2011 you have to opt in by April 1, 2010. You can still opt in after April 1, but then your eligibility will take a full calendar year instead of happening next January.
Once you’ve opted in, you will pay your premiums, which are $1.73 / $100 of insurable earnings, with your 2010 tax return. You only pay premiums on the first $43,200 you earn annually, since that is the maximum insurable income level under EI for 2010. Premiums and maximum insurable earnings are typically re-examined annually.
If you’re self-employed and you think you might like to start a family in 2011, this is the time to opt in and sign up for benefits. It’s a good idea to think ahead as much as possible since you need to pay premiums for a full year before collecting, so if you’re holding a positive pregnancy test in your hand it may already be too late to receive your maximum benefits. However, even in that situation you may be eligible for some portion of maternity or parental leave, as you remain eligible for a full year after the baby arrives – so keep that in mind!
On a personal note, I am thrilled that the self-employed and small business owners are finally eligible for maternity and parental leave in Canada. While they undoubtedly face special challenges in taking time away from work, they are no less deserving than any other parent.