There are three federal programs offered to businesses because of the pandemic: the Canada Emergency Wage Subsidy, the Canada Emergency Business Account and the Canada Emergency Rent Subsidy.
LOANS
The Canada Emergency Business Account is a loan of up to $60,000, with a forgivable portion of up to $20,000, to help businesses pay non-deferrable expenses. CEBA has two streams of eligibility: the payroll stream and the non-deferrable expense stream. These loans are government funded and interest free if repaid before Dec. 31, 2022.
Those who have previously received the loan of up to $40,000 can apply for the CEBA expansion to increase their loan by an additional $20,000, with an additional $10,000 forgivable portion if repaid before Dec. 31, 2022 after self-attesting to having experienced a revenue drop.
The money is taxable in the year you receive the CEBA or CEBA expansion, not in the year the loan is forgiven.
RENT SUBSIDY
The Canada Emergency Rent Subsidy provides rent and mortgage support to small businesses affected by COVID-19. It will be administered by the Canada Revenue Agency and provide support directly to tenants.
It is administered on a period-by-period basis, with each period spanning four weeks. Generally, new periods are open for application the day after a CERS period has ended.
The subsidy will be available on a sliding scale with a maximum amount of 65 per cent for businesses that can demonstrate a revenue loss for the period from Sept. 27 to Dec. 19, 2020.
An additional top up of 25 per cent (maximum possible subsidy of 90 per cent) will be available for organizations temporarily shut down by a mandatory public health order issued by a qualifying public health authority. Program duration: Sept. 27, 2020 to June 2021.
After using the CERS calculator, you must apply online through one of two CRA portals: MyBusiness Account or Represent a Client.
Businesses need to apply for the rent subsidy after a month has passed. For example, applications for November support would not be available until December. Claims can also be made retroactively to cover the period Sept. 27 to Oct. 24, 2020.
Application deadline: 180 days after the end of each claim period.
WAGE SUBSIDY
The Canada Emergency Wage Subsidy is a wage subsidy program offered until June 2021 to qualifying employers who have seen a drop in revenue due to COVID-19. CEWS is meant to prevent more job losses by helping keep employees on payroll, enabling workers to be rehired and facilitating a return to normal operations. If businesses qualify, they get a percentage of employees’ pay paid by the government based on revenue loss.
The CEWS rate increased to 75 per cent as of Dec. 20, 2020 to March 13, 2021 (periods 11-13). Applicants with a revenue loss of 70 per cent or more will be able to receive the maximum 75 per cent wage subsidy. The earliest applicants will be able to apply for Period 11 will be Jan. 18.
Source: Canadian Federation of Independent Business
