Government pandemic assistance for business

There are three federal programs offered to businesses because of the pandemic: the Canada Emergency Wage Subsidy (CEWS), the Canada Emergency Business Account (CEBA), and the Canada Emergency Rent Subsidy (CERS).

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 their non-deferrable expenses. CEBA has two streams of eligibility: the Payroll stream and the Non-Deferrable Expense stream. These loans are government-funded, interestfree (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 CEBA and CEBA expansion forgivable loan portion (up to $20,000) are taxable in the year you receive the CEBA or CEBA expansion. Not in the year the loan is forgiven. Keep this in mind when applying for the CEBA or its expansion in 2020.

RENT SUBSIDY

The Canada Emergency Rent Subsidy will provide rent and mortgage support to small businesses affected by COVID-19. The subsidy will be administered by the CRA and will provide support directly to tenants.

It is administered by the Canada Revenue Agency (CRA) on a period-by-period basis, with each period spanning four weeks (a CERS Claim Period). Generally, periods are open for application the day after the CERS period has ended.

Amount businesses can receive: 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 (MyBA) and Represent a Client.

Like the CEWS, businesses will need to apply for the rent subsidy after the month has passed. This means, for example, that applications for November support will 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 you keep your employees on payroll, enabling you to re-hire workers, and facilitating a return to normal operations. If you qualify for CEWS, you will get a percentage of your employees’ pay paid by government based on your revenue loss.

The CEWS rate increase to 75 per cent as of Dec. 20, 2020 to March 13, 2021 (periods 11-13) is official. 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 that applicants will be able to apply for Period 11 will be Jan. 18.