Canadian Government COVID-19 Assistance Programs

There are several assistance programs offered by the Canadian government. This blog post outlines some of what is available and how to apply for them.

NOTE: This information needs to be confirmed by the company that applies to these programs. You must determine your own eligibility for each program offered. We simply show where to apply for them.

This link from the Canadian Government leads to many programs being offered during the COVID-19 pandemic. It includes information for individuals as well but they are not discussed in this post.

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

 

10% Wage Subsidy

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

Organizations described in the link that have a payroll account qualify for getting 10% back on your gross payroll of up to $1,375 per employee to a maximum of $25,000 per employer.

It is available for payroll dates of March 18th, 2020 to June 19th, 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 make sure you get the maximum that is due. See instructions below on how it works.

 

Spire’s Subsidy Calculator

If you are claiming the Temporary Wage Subsidy for Employers, then 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. Then add that GL account as below.

 

When submitting the payroll deductions, the subsidy will be calculated and posted to this GL account.

 

The subsidy amount will be posted to the Subsidy income account.

 

$40,000 Interest-Free Loan

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

The application is done through your bank.

This example shows how it is done 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 certain criteria, including (but not limited to) the following:

  • RBC is your primary bank for business banking.
  • Your RBC business deposit account was open 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:

  • If you are eligible, you will have already been sent an email and/or a link to apply on your My Accounts page.
  • If you are not registered for online banking, click here to enroll in RBC Online Banking for Business.
  • If you are an RBC Express client, please contact your RBC Account Manager for separate instructions to enroll 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 27th, you can log into your MyBusiness site to apply for a 75% wage subsidy. Use this link to logon https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/business-account.html

This subsidy is paid 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 they are updating it frequently.

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)

Then select the period you are reporting on.

 

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

 

Add your contact information and click on ‘Submit’.

NOTE: Be sure to set up direct deposit with CRA because a mailed cheque adds a big delay.

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