COVID-19 Update on Financial Resources for Individuals and Businesses

Updated June 19, 2020

Below please find a recap on the various government programs, resources and filing deadlines available for small businesses and individuals. Announcements on new programs and changes have been on a daily basis so we will attempt to keep this updated:

Individuals
Tax Filing Extensions

• Individual tax filing deadline extended from April 30 to June 1, 2020.
• Self Employed tax filing deadline unchanged – still June 15, 2020.
• Payment deadline for income tax owing extended to September 1, 2020.
• June 15 Instalment deadline extended to September 1, 2020.

For more information see here. 
 
For those not able to work or laid off
Canada Emergency Response Benefit (CERB)

• For individuals laid off and not receiving EI or are self-employed or still employed by not receiving any pay due to COVID-19.
• Will provide monthly payments of $2,000.
• Can apply after April 6, 2020 via a portal in CRA My Account or via telephone through an automated toll free line.
• More details can be found here 

 
Businesses
Filing Extensions – Income Tax

• Tax filing deadlines remain in place for Self Employed -June 15th filing deadline .
• Corporations – with September, October, November year ends – extended filing due date to June 1, 2020.
• Corporations with December, January or February year ends - extended filing due date to September 1, 2020.
• Income tax payments normally due after March 18 –  now extended to September 1, 2020.

 
Registered Charities with year ends between September 30 2019 to June 30 2020 -  Charity Return due date extended to December 31, 2020.
 
GST/HST
Normal filing deadlines remain in place – still must file on normal due date.
However, payments of HST owing can be deferred until June 30 without interest.
 
Payroll Deduction Remittances
Normal filing and payment due dates for Payroll Deduction Remittances. However, may be eligible for a reduction of remittance with the 10% Temporary Wage Subsidy (below).
 
10% Temporary Wage Subsidy

• Available to Sole proprietorships, Partnerships, Non-Profit Organizations and Corporations eligible for the Small Business Deduction.
• Subsidy of 10% of employee gross wages paid from March 18, 2020 to June 19, 2020.
• Up to $1,375 per employee. Maximum of $25,000 per employer.
• You do not need to apply for this subsidy, but rather claim it as a deduction against the income tax portion in that month’s payroll deduction when remitting in the following month.

For details and examples see here. 
 
75% Canada Emergency Wage Subsidy
Available to all businesses regardless of size, as well as non-profits, if their revenue for the month has dropped 30% from that same month in the previous year or from their Jan/Feb 2020 average.

• Calculated as 75% of gross wages paid by eligible employers up to a maximum of $847 per employee per week for up to 12 weeks, retroactive to March 15, 2020.
• Eligible employers need to have shown at least a 15% drop in revenues for March and a 30% drop for subsequent months. (see more details on these rules in the link below). You should ensure you are eligible as penalties will apply if you make a fraudulent claim or if you artificially reduce your revenues to qualify. 
• Calculated on wages paid between March 15 and June 6, 2020.
• The The Government announced on May 15, 2020 that the CEWS would be extended by an additional 12 weeks, to August 29, 2020.
  
• The CRA has made available a tool to calculate the subsidy. This should be calculated before applying. See "Calculate your Subsidy" in the link below.
• Application processing expected via CRA’s My Business Account or a separate web portal.
• If you are eligible for both the 10% and 75% wage subsidy, any amount eligible under the 10% program will reduce the payment receivable under the 75% program.

 
More details on the 75% wage subsidy here. 
 
Business Credit and Loan Programs
The government has established a Business Credit Availability Program through Business Development Bank of Canada (BDC) and Export Development Canada (EDC).  BDC and EDC are working with the banks to coordinate getting this credit to small businesses. The main program for small businesses is the:

Canada Emergency Business Account (CEBA)

• Offers a $40,000 interest free loan of which only $30,000 needs to be repaid (so includes $10,000 grant portion).
• Loan available to eligible businesses that have paid between $20,000 and $1.5 Million in wages in 2019 as indicated on their 2019 T4 Summary. 
• The government announced that the loan will extended to businesses that may not meet the wage test above (eg sole proprietorships, those that rely on contractors vs employees or who pay employees through dividends rather than salary)  However the implementation of these changes continues to be delayed.

• Interest free loan until December 31, 2022. Early re-payments can be made after July 1, 2020. 
• Application through your business bank - online or can try calling your bank. Ensure you have your 2019 T4 Summary on hand when applying.

 
More information can be found here.
 
Further information
We have found the Canadian Federation of Independent Business (CFIB) a great resource for information for businesses dealing with this crisis – see a link to their page here.