Over the past several weeks, there have been a number of government programs announced to assist individuals and businesses during the COVID-19 pandemic. Below is a summary of the programs that have been announced to assist businesses and not-for-profit/charitable organizations.
The Greater KW Chamber of Commerce continues to advocate on behalf of the business community. If you have questions or are experiencing challenges, please contact Art Sinclair, Vice President of Public Policy and Advocacy at email@example.com.
UPDATE: On July 27, 2020, Bill C-20, which includes amendments to the CEWS, received Royal Assent. The amendments to CEWS are outlined below. Applications for claim period (July 5 to August 1) will open August 17, 2020. Please visit the CEWS website for more information.
For more information about the CEWS amendments, please see the federal government’s Adapting the Canada Emergency Wage Subsidy to Protect Jobs and Promote Growth document.
Under the Canadian Emergency Wage Subsidy program, eligible businesses may receive a subsidy of 75% of employee wages up to a maximum of $847 per week for up to 12 weeks, retroactive from March 15 to August 29, 2020. Registered charities and not-for-profit organizations are eligible to apply to the CEWS. Eligible businesses that see a drop of at least 15% of their revenue in March 2020 and a 30% revenue decrease in April and May 2020 may qualify for the wage subsidy.
There is a calculator available to help businesses determine the amount of wage subsidy they may be eligible for. The CEWS application portal is open; employers can apply for the CEWS through My Business Account or through the CRA’s online application portal, and their representatives can apply through Represent a Client. More information on the application process Is available on the website.
UPDATE: UPDATE: On June 26, 2020 it was announced that the expanded CEBA is now open for applications. Businesses eligible for CEBA now included owner-operated small businesses that do not have a payroll, sole proprietors receiving business income directly, as well as family-owned corporations remunerating in the form of dividends rather than payroll. Please see the CEBA site for more information
The Canadian Emergency Business Account program will provide interest-free loans of up to $40,000 to small businesses and not-for-profit organizations to help cover operating costs. Businesses who repay the balance of the loan on or before of December 31, 2022 will result in loan forgiveness of 25% (up to $10,000).
To qualify, organizations need to demonstrate that they paid between $20,000 to $2.5 million in total payroll in 2019. Business owners can apply for the CEBA program through their financial institution.
UPDATE: On July 31, 2020, the Finance Minister announced that the CECRA would be extended for one month, to the end of August
The Canadian Emergency Commercial Rent Assistance is a joint program between the federal and provincial government to provide rent assistance to small businesses. This program offers eligible property owners with forgivable loans so that they can reduce the rent owed by a small business tenants by 75% for the months of April, May and June. The CECRA was extended to the end of July. Eligible small businesses, which includes non-profit and charitable organizations, who:
Property owners are responsible for applying for this program. The Canada Mortgage and Housing Corporation will be administering this financial support. You can find more information on the CECRA program and apply here.
Update: On June 16, 2020, the Prime Minister announced that the CERB would be extended by 8 weeks.
The Canadian Emergency Response Benefit is temporary income support that is available to Canadians who have lost their job due to COVID-19. This financial support is also available for self-employment individuals. The CERB will provide those who are eligible with $500 per week for up to 16 weeks. Those who receive the CERB benefit will need to re-apply after each 4-week period. Individuals able to earn up to $1,000 per 4-week period in employment and/or self-employment income. More information about the CERB, including how to apply, can be found here.
The Business Credit Availability Program provides additional financial support through the Business Development Bank of Canada (BDC) and Export Development Canada (EDC). This program includes:
On May 13, 2020 , the Regional Relief and Recovery Fund (RRRF) was announced to help support small and medium-sized businesses that do not qualify for, or have been declined for, current Government of Canada COVID-19 relief funding. This funding will be delivered by Canada’s six regional development agencies. In southern Ontario, $252.4 million is available, which is comprised of $213 million for small and medium-sized businesses facing financial pressure; and $39.4 million to provide rural businesses with access to capital and business support. Eligible businesses must:
Priority may be given to businesses in the manufacturing, technology, tourism and other sectors key to the region, that are major employers in small communities or that support the government’s commitment to underrepresented groups.
There are two funding options: 1) up to a $40,000 conditionally repayable contribution (interest-free loan) and 2) up to $500,000 unconditionally repayable contribution (interest-free loan). For more information about the program, including how to apply, please see the program guidelines and the frequently asked questions. The Application Guide for the RRRF program can be found here.
The federal government announced funding to support farmers, food businesses, and food processors. This support will include:
The Agri-Food Open for E-Business is a joint program with the Governments of Canada and Ontario being offered through the Canadian Agricultural Partnership to help the agri-food sector expand to online services. More information about the program, including how to apply, can be found here.
Through this program, Farm Credit Canada helps businesses with cash flow challenges. Existing members of Farm Credit Canada can ask for deferrals of principal and interest payments up to 6 months or a deferral of principal payments of up to 12 months. More information about the program, including how to apply, can be found here.
The federal government announced up to $306.8 million in funding to support small and medium-sized Indigenous businesses and to support Aboriginal Financial Institutions that offer financing to these businesses. The funding will allow for short-term, interest-free loans and non-repayable contributions through Aboriginal Financial Institutions, which offer financing and business support services to First Nations, Inuit, and Métis businesses. These measures will help 6,000 Indigenous-owned businesses get through these difficult times. More information about this support can be found here.
The WSIB Financial Relief package allows businesses to defer premium reporting and payments until August 31, 2020. Businesses who report and pay monthly, quarterly or annually based on their insurable earnings are eligible for this deferral. All businesses covered by the WSIB’s workplace insurance are automatically eligible for the financial package. No action is required from businesses to receive the financial relief. More information about this relief package can be found here.
The Canada Revenue Agency (CRA) will allow all businesses to defer, until August 31, 2020, the payment of any income tax amounts that become owing on or after March 18, 2020 and before September 2020. This relief would apply to tax balances due, as well as instalments, under Part I of the Income Tax Act. No interest or penalties will accumulate on these amounts during this period.
Individuals have until June 1st to file their taxes for the 2019 year.
Employer Health Tax (EHT) Exemption
On March 25, 2020, the Ontario government announced it is increasing the Employer Health Tax (EHT) exemption for 2020 from $490,000 to $1 million due to the special circumstances caused by the coronavirus (COVID-19) in Ontario. The EHT is a payroll tax that employers pay based on their total remuneration – which has a top rate of 1.95%. This program applies to private sector employers with a total Ontario Remuneration of $5 million and under.
Deferral of all Goods and Services Tax/Harmonized Sales Tax Remittances
The CRA will allow all businesses to defer, until the end of June 2020, any GST/HST payments or remittances that become owing on or after March 27, 2020, and before June 2020. This means that no interest will apply if your payments or remittances are made by the end of June 2020. The deadline for businesses to file their returns is unchanged. Those who are able to, should continue to file their GST/HST returns on time reporting their net tax for the reporting period to help facilitate tax compliance and administration. However, recognizing the difficult circumstances faced by businesses, the CRA won’t impose penalties where a return is filed late provided that it is filed by June 30th.
Deferral of Customs Duty and Sales Tax for Importers
Imported goods by businesses are generally subject to the GST, at a rate of 5 per cent, as well as applicable customs duties, which vary by product and country of origin. While the vast majority of imports enter Canada duty-free, some tariffs remain, especially on consumer goods. The CRA will allow payments for statements of accounts for March, April, and May to be deferred to June 30, 2020.
The government has announced its intention to create a series of programs directed toward students and recent graduates. The application portals for the programs listed below are not yet open; we will provide an update as soon as more information is available.
The government will also expand existing federal employment, skills development and youth programming, including: