Keeping up to date with the ongoing Economic Response due to COVID-19 we have listed some of the updated measures that would be most applicable for small businesses. For a detailed list of all the economic support please refer to the Government of Canada website.
Updated Canadian Emergency Bank Account (CEBA):
An interest free loan through your corporate bank of up to $40,000. The loan is interest free until December 31, 2022. If repaid by December 31, 2022 $10,000 of the loan can be forgiven.
To be eligible the business will need to have paid at least $20,000 in payroll through a payroll account in 2019. OR
Applicants with $20,000 or less in payroll can still apply if they can demonstrate having eligible Non-Deferrable Expenses of at least $40,000. These types of expenses are contractual obligations that cannot be deferred, such as rent, payroll, utilities, insurance, property taxes.
The business must agree to use the funds for operating expenses that cannot be deferred. The loan is intended for businesses that continue to operate and need the cash flow to cover operating costs.
Most banks have made available the application for these loans. The application is done online via your bank. You will require the information from the corporation’s 2019 T4 Summary or proof/contracts of the non-deferrable expenses.
Visit your business banks website for further details.
Updated Canadian Emergency Wage Subsidy (CEWS):
The wage subsidy has been updated so that if your business revenue drop was less than 30% starting in July you can still qualify for the CEWS for periods 5 onwards (July onwards).
The business would have to have seen a drop in revenues when comparing year over year revenues for a particular month due to COVID. For example, comparing July 2020 revenues to July 2019.
The new subsidy percentage rate is determined by how much the revenue dropped.
Based on that rate a percentage of wages paid are reimbursed through the subsidy.
The business must have an existing payroll account and have been paying pre-crisis wages.