Can I make money while on Parental and Maternity leave? This is a frequent question my Canadian Budget Binder fans want to know. So, I went to Mom Expert Sarah Deveau Author of Money Smart Mom to share the inside scoop for our fellow Canadians wanting to learn about making some extra money while they are off work caring for their new bundle(s) of joy.
Here’s what Sarah has to say….
If you’ve just had a baby and are living on the reduced income of employment insurance maternity or parental leave payments, you might be wondering how to bring in extra income.
If you earn income while on the maternity leave portion of the benefit (the first 15 weeks), your earnings will be deducted dollar for dollar from your benefits.
If you work while you’re receiving the parental leave benefit, after the first 15 weeks, in the past you’ve been allowed to earn $75 per week or 40% of your weekly benefits, whichever is higher. Any income earned above that amount will be deducted dollar for dollar from your benefits.
However, due to the new Working While on Claim (WWC) pilot project, once you have served the waiting period, if your earnings are equal to or less than 90% of your weekly earnings that were used to calculate your benefit rate, your benefits will be reduced at a rate of 50% of your earnings each week. Any earnings that exceed this 90% mark, will be deducted dollar for dollar from your benefits. The 50% claw-back begins at the first dollar earned.
Due to negative feedback, the government is letting anyone on parental leave after January 6, 2013 choose which way they want their income taxed – the old way, or the new way.
For some examples of how these calculations work, see the Service Canada website. If in doubt, write to Service Canada and get their advice and calculations for your individual income level in writing.
Here are a few suggestions for ways you can earn additional income while on parental leave to help with your maternity/parental leave budget:
- Drive a school bus
- Offer evening and weekend babysitting for friends and family
- Deliver newspapers
- Operate a drop in day home
- Sign up to participate in focus groups
- Create a freelancing or in-home business in your area of expertise (tutoring, writing, music lessons, etc.)
- Join a virtual office company in your area
- Work as a casual employee, on occasional weekends or evenings when you have access to free childcare (spouse or relatives)
- Sign up as a secret shopper (be sure to join a reputable company)
- Work temporary jobs, such as seasonal retail help
If you earn money while on parental leave, you will be required to fill out regular reports. Be sure to contact Service Canada if you have any questions about earning or reporting income while on parental leave.
What other ways did you earn extra income while on Parental leave?
Guest Post By: Sarah Deveau is a mom of three, and the author of Money Smart Mom: Financially Fit Parenting. Visit her website at MONEY SMART MOM or pick up her book from Chapters Indigo.
Here is a Book Review that I did for Sarah once I finished reading her book… Money Smart Mom Financially Fit Parenting: Book Review Mr.CBB.
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