Hello everyone, in this article learn more about the New Federal COVID Support Programs.
The Department of Finance has recently released the introduction of a new Canada Emergency Rent Subsidy (CERS) and extensions to the existing Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Business Account (CEBA) loan program.
• Click here to read the news release.
Canada Emergency Rent Subsidy (CERS)
In addition to adding a new acronym to our tax and accounting world, the CERS is a rent subsidy that will be provided directly to tenants, while also providing support to property owners. This new rent subsidy will support businesses, charities, and non-profits that have experienced a revenue drop, by subsidizing up to a maximum of 65% of expenses until December 19, 2020. You will be able to make claims retroactively for the period that began September 27 and ends October 24, 2020. There will be a top-up of 25% (total subsidy of up to 90% of expenses) for businesses shut down due to mandatory public health orders. At this time, no additional information or eligibility criteria have been released.
Canada Emergency Wage Subsidy (CEWS )
The CEWS has been extended until June 2021. The current subsidy rates and eligibility criteria will be in effect until December 19, 2020.
Please visit the official site for more details (https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html).
If you have questions or need assistance in determining if you qualify for the CEWS and/or in preparing your submissions, please contact us.
Canada Emergency Business Account (CEBA)
The CEBA provides a $40,000 interest free loan to business affected by COVID for non-deferrable business expenses. The application deadline has been extended to December 31, 2020. If you qualified for the original $40,000 loan and you are still impacted by COVID, you may be eligible for an additional $20,000. An attestation of the impact COVID-19 has had on your business will be required to access the additional funding. Half of this financing would be forgivable if repaid by December 31, 2022.
• https://ceba-cuec.ca/
Temporary Wage Subsidy (TWS)
The TWS was the very first program rolled out right at the outset of COVID back in March. It was intended for small businesses with employees on payroll and allowed you to reduce your payroll sourced deductions by 10% of the gross income per employee up to a max of $1,375 per employee between March 18, 2020 and June 19, 2020. If you took advantage of this program, it will reduce any claims under the CEWS. If you qualify, but didn’t reduce your source deduction payments, you can still claim it at the end of the year and receive a refund or a credit on next year’s payroll account. If you are unsure if you qualify or if you started claiming the TWS and then determined you were eligible for the CEWS, you will want to ensure that you have all records of what was paid, not paid, claimed or not claimed in order to ensure proper reporting at year-end. You should expect to receive a “self-identification form” from CRA that will require you to identify each payroll program where remittances were reduced for reconciliation purposes. Additional details are available on the pages below. Form PD27 will need to be completed and sent to CRA or the information can be submitted electronically through your CRA My Business Account.
• https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html
• https://www.canada.ca/en/revenue-agency/services/subsidy/temporary-wage-subsidy/tws-reporting.html
Canada Emergency Commercial Rent Assistance (CECRA)
If you or your property owner applied and received support from the CECRA program, the deadline to opt-in for the CECRA extension for July, August and September is October 30, 2020. This program provides support to property owners that have provided rent relief to their tenants that have been impacted by COVID. See this link for details.
https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business
Small and Medium Enterprise Relaunch Grant
The Government of Alberta released this program to provide grants to businesses reopening after closing due to COVID. You may be eligible for 15% of your average monthly pre-Covid income if you have experienced a reduction of revenues of more than 50%. The intent of this program is to help you cover costs such as physical barriers, purchasing personal protective equipment and disinfecting supplies, paying rent and employee wages and/or replacing inventory, among other expenses. The maximum amount you can receive is $5,000. Application intake will remain open until at least August 31st. You can apply through the Alberta online system. Details on eligibility and the application process are provided on this site:
• https://www.alberta.ca/sme-relaunch-grant.aspx#:~:text=Trade%20and%20Tourism-,Overview,of%20the%20COVID%2D19%20pandemic.
If you have any questions about any of the New Federal COVID Support Programs, please feel free to call us at 403-509-3290 or email us at info@focusllp.ca.
On behalf of all of us at Focus LLP stay safe and healthy!
Glenn Fines, CPA, CGA
Partner
Focus LLP