A round of letters from the Canada Revenue Agency has self-employed Canadians who received the Canada Emergency Response Benefit (CERB) worried they may have to pay back the thousands of dollars they say kept them afloat during the pandemic’s early months.

The letters, which the CRA said were sent to CERB recipients for whom the agency can’t confirm eligibility for the benefit, say that self-employed recipients needed $5,000 in net employment income — income after expenses — to qualify, either in 2019 or in the 12 months leading up to the date of their application.

However, some self-employed CERB recipients say the CERB application and eligibility criteria did not mention net income, and believed that their gross income qualified them for the benefit.

Pan Dong, a self-employed paralegal in Toronto, is one of them.

His income before expenses — in other words, his gross income — was well above $5,000 when he applied for CERB, he said.

But thanks to the expenses of owning a business, especially during a pandemic, his net income was below $5,000. However, at no time during the application process was he made aware that his eligibility was based on his net income, Dong said.

Now, it seems he may have to pay back the $14,000 in federal funding he received.

“For a lot of people, it’s not a small amount of money,” Dong said.

He’s not alone.

Tracey Crosson is the admin for Facebook group “Canada CERB / EI / CRB Unofficial Support Group,” which is run by non-profit Ubi Works. She said the group has hundreds of members who are self-employed and in the same situation as Dong: they made more than $5,000 in gross income, but less than $5,000 in net income.

They, too, received the letter from the CRA saying they may not be eligible for the benefit, and may be required to pay back the money.

“I don’t know how people are going to survive,” Crosson said.

The CRA said the eligibility criteria have not changed since CERB began.

“The CRA considers self-employment income as the net pre-tax income (gross income less expenses). This is consistent with how self-employment income is calculated when dealing with the CRA. To be clear, there has been no change to this position during the life cycle of the CERB.

“This requirement was publicized on Canada.ca since the beginning, specifically under the category ‘Self-Employed and Independent Workers’ on the question and answers page,” a CRA spokesperson said in an email. (The Star has verified this. However, under the “eligibility” and “income requirements” categories on the same , it mentions self-employment income but does not specify gross versus net income.)

The spokesperson also clarified that receiving the letter does not necessarily mean a person has to pay back the CERB money.

“Individuals who have received this letter should not interpret it as a determination that they have definitively been deemed ineligible for the CERB; what the letter means is that the CRA does not yet have the information needed to confirm that they are in fact eligible for the benefit,” the email said.

“The letter strongly encourages those individuals who have yet to file their 2019 returns to do so as soon as possible, as this is the simplest way to confirm their eligibility. We expect this will likely be the case for many of the individuals who receive this letter.”

Though the CRA is encouraging people to pay back any owed CERB money by the end of the year, the spokesperson said this is not mandatory, but rather encouraged “to ensure that there is no impact on the recipient’s 2020 income tax return.”

But people receiving these letters say the criteria for CERB wasn’t made clear enough to begin with.

That’s what Cory Perry said happened to his partner, Diane Duplessis.

Duplessis runs a private daycare out of the couple’s home that was shut down at the beginning of the pandemic. When she went to apply for CERB, Perry said, she assumed that the criteria on the website was referring to gross income. (The Perry referred to says, as of publication time, that to be eligible an applicant must earn $5,000 before taxes, but does not mention “net” or “gross.”)

The money helped the family keep their heads above water, Perry said. But now, it looks like Duplessis may have to repay the $14,000 she received.

If that’s the case, the couple may have to sell their home, Perry said.

David Murray, an accountant in Wilmot, Ont., said he’s heard from self-employed Canadians across the country, including several of his own clients, who are in the same situation. That’s why he started a to amend the criteria for these CERB applicants, alleging that the CRA added the “net” to the eligibility criteria later on (the CRA denies this claim).

Small-business owners have a lot of expenses that can lower their net employment income, Murray said, including tools, bills and the depreciation of assets like vehicles.

Many people have already spent their CERB money on rent or other bills, he added, and don’t have the means to pay it back.

Murray also pointed out that on the for the government’s new temporary Canada Recovery Benefit, the eligibility criteria specifically state that self-employed income is income minus expenses.

Vicki Hargreaves, the moderator for the Facebook group “I Lost My Gig Canada” and a lead advocate for an arts group in Kingston, Ont., said many self-employed artists are in this situation, too.

The CRA’s letter, for many, was the first time these applicants were hearing about the net income requirement, she said.

“That information wasn’t available.”

And it’s not just self-employed people who are receiving these letters.

Brandi Campbell applied for CERB after the pandemic forced the casino she worked at to shut down temporarily. She said she made more than $5,000 in gross employment income, and that none of the information on government web pages or in the application mentioned gross or net.

Campbell received the full CERB amount, $14,000, and then received a letter two weeks ago saying the CRA couldn’t confirm her eligibility. The letter includes “gross employment income” and “net self-employment income” as examples of a valid source of income for CERB eligibility.

“When I received the letter … I was absolutely shocked,” said Campbell, who said she did her taxes in early 2020 to make sure she could qualify for the benefit.

Now she’s worried she may have to pay it all back.

“We’re all wondering what the ramifications are going to be.”

Correction — Dec. 10, 2020: This article was edited to clarify that Brandi Campbell did her taxes in early 2020 to make sure she could qualify for the CERB.

Rosa Saba is a Toronto-based business reporter for the Star. Follow her on Twitter: