Canadian Government COVID-19 Assistance Programs

In 2020, the Canadian Government offered several assistance programs. This blog post outlines some of what was available and how to apply for them and we will take a look a look at how you can manage payroll subsidies in Spire. 

Note: This information needs to be confirmed by the company that applies to these programs. It would be best if you determine your eligibility for each program offered. We are only showing you where you can apply. 

The link below is from the Canadian Government and has several program offerings for your business to consider during the COVID-19 pandemic. It includes information for individuals as well. We don’t cover personal information in this blog post and always recommend you get in touch directly with the Canadian Government for clarification. 

https://www.canada.ca/en/department-finance/economic-response-plan.html

Canadian Government 10% Wage Subsidy

Click this link to determine eligibility for the Wage Subsidy being offered by the Government of Canada,

Organizations who manage payroll can qualify for 10% back on gross payroll and up to $1,375 per employee and a maximum of $25,000 per employer.
It is available for payroll dates of March 18, 2020, to June 19, 2020, at the time of this writing (April 27, 2020).
To claim it, the employer can reduce the amount of their payroll remittance for the period. Spire 3.4 has a built-in calculator that uses all the rules that CRA put in place to ensure you get the maximum due. See instructions below on how it works.

Spire’s Payroll Subsidy Calculator

Suppose you are claiming the Temporary Wage Subsidy for Employers. In that case, the source remittance will automatically reduce the payment to CRA for the eligible amount and post it to the GL account setup in company settings -> Payroll -> employer -> Temporary Wage Subsidy Revenue Account.

First, create a GL account for the subsidy income. Second, you will then want to add that GL account as indicated below.

 

When you submit the payroll deductions, Spire will calculate the subsidy and post it to this GL account.

 

Spire will post the subsidy amount to the Subsidy income account.

$40,000 Interest-Free Loan

The Canadian Government is lending businesses $40,000 for ongoing expenses, including payroll. See this link for more details.   https://ceba-cuec.ca/

You can apply for this loan through your bank.

This example shows how to apply through Royal Bank (RBC)

What is and How to Apply for the Canada Emergency Business Account?

For a business to be eligible for the Canada Emergency Business Account (CEBA), per the Government of Canada’s requirements, the organization must meet specific criteria, including (but not limited to) the following:

  • RBC is your primary bank for business banking.
  • The RBC business deposit account you opened was before March 1, 2020, is active and in good standing.
  • Your organization was registered and operational on or before March 1, 2020.
  • Your organization is not a holding company.
  • Has total employment income paid in the 2019 calendar year between $20,000 and $1,500,000?

To enroll for CEBA, log into your RBC Online Banking for Business:

  • Those eligible will already have an email or link to apply on your My Accounts page.
  • If you do not have online banking, click here to enroll in RBC Online Banking for Business.
  • If you are an RBC Express client, don’t hesitate to contact your RBC Account Manager for separate instructions to register for CEBA.
  • Please note that the CEBA enrollment cannot be fulfilled in our branches or through our advisors and RBC Advice Centre.

Click on the ‘Learn More’ box that looks like this.

Follow the instructions for the bank, and if you are approved, a new line of credit or credit card will appear in your account with a $40,000 limit..

75% Wage Subsidy

As of April 27, you can log into your MyBusiness site to apply for a 75% wage subsidy. Use this link to log on  https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/business-account.html

This subsidy pays out to businesses that have seen a drop in revenues, as defined in the link below.
https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html

The link includes a handy spreadsheet to assist with the calculation. Be sure to check back for the latest version as these are constantly updating.

https://www.canada.ca/content/dam/cra-arc/serv-info/tax/business/topics/cews/cews-calculation.xlsx

Once you have calculated the amounts go into your MyBusiness account and select payroll -> Canada Emergency Wage Subsidy (CEWS)

 

You then will want to make sure you select the correct reporting period because this is a required step. See our image below:

 

Fill in the amount that you have calculated manually or with the included spreadsheet.

 

Add your contact information and click on “Submit.”

NOTE: Make sure you have a direct deposit set up with the CRA. A mailed cheque adds a considerable delay.

 

For more information about how Spire manages payroll and sign up for a free demo click here.

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