As of early April, the Government of Canada has announced a number of measures to support Individuals, Businesses and specific Industries deal with the economic impact of the COVID-19 pandemic.
While every detail of each program has not been fully released as of April 16th, the government is making details public as they become available in real-time.
There are a number of sources producing useful summaries of the Economic Response Plan; however, given the somewhat real-time nature of the release of specifics, the Government of Canada has put together an informative webpage where detailed information, summaries and FAQs are available:
Here are some highlights of the programs:
A. Support for Individuals and Families
i. Canada Emergency Response Benefit. The CERB becomes accessible online as of April 6th for eligible workers who have lost their income due to COVID-19. A taxable benefit of $2,000 per month is available for up to 4 months. Note, the CERB is also available to self-employed individuals.
For more information and to apply www.canada.ca/en/services/benefits/ei/cerb-application.html
ii. Mortgage Support. Canadian banks have committed to work with their customers to defer up to six monthly mortgage payments (principal & interest) on a case-by-case basis. Please consult your financial institution for their COVID-19 related support measures.
iii. Income Tax Filing & Payment Dates. Due dates for individuals have been extended to June 1st for filing. The payment of any amounts outstanding has been extended to August 31st.
iv. Reduced Minimum Withdrawals for Registered Retirement Income Funds. The minimum required withdrawals from RRIFs has been reduced by 25% for 2020.
v. Suspend Repayment and Interest on Canada Student and Apprentice Loans. All student loan borrowers will automatically have their loan repayments and interest suspended for six months through September 30th. This will apply to the Federal portion of student loans; however, a number of Provincial bodies have followed suit.
For more information www.csnpe-nslsc.canada.ca/en/what-is-new
vi. Special Goods and Services Tax Credit Payment. A one-time special payment of $400 for single individuals and $600 for couples will be made starting April 9th through the GST credit for low- and modest-income families. No application is required for this payment that will automatically be made to eligible individuals and families.
vii. Increasing the Canada Child Benefit. The CCB will pay an extra $300 per child for 2019-20, as part of the scheduled CCB payment in May. If you already receive the CCB, you will automatically receive this.
B. Support for Businesses
i. Canada Emergency Wage Subsidy. Provides a subsidy up to 75% on renumeration paid up to $847 per week or 75% of the employee’s pre-crisis weekly renumeration, whichever is less. Note, the subsidy covers a series of 4-week periods retroactive to March 15th, with eligibility for each period based on a revenue test. As currently structured, the last 4-week period would end June 6th. Businesses can apply at the CRA’s My Business Account Portal.
For more information www.canada.ca/en/department-finance/economic-response-plan/wage-subsidy.html
ii. Extending the Work-Sharing Program. The work-sharing program now allows for 76 weeks for employers impacted by COVID-19, up from the normal 38 weeks.
iii. Income Tax Filing & Payment Dates. The due date for Corporations is extended to June 1st (Self-Employed due date remains June 15th). Payment dates of any amounts outstanding have been extended to September 1st.
iv. Business Credit Availability Program. The BCAP will provide $65 billion of direct lending and financial support to Canadian businesses via Export Development Canada (EDC) and Business Development Bank of Canada (BDC).
Loan guarantees and incremental credit amounts of up to $6.25 million will be made available to small and medium enterprises. Interested businesses should contact their financial institutions who can guide their application process.
For more information refer to EDC and BDC, respectively
v. Canada Emergency Business Account. Interest-free loans of up to $40,000 will be provided to small businesses to cover operating costs, with eligibility based on a revenue test. This program will roll out in mid-April. Interested businesses should contact their financial institutions for more information.
vi. Deferral of GST/HST Tax Remittances. The date by which monthly/quarterly filers of GST/HST returns must collect and remit the GST/HST has been extended to June 30th for monthly filers of February, March and April returns, as well as quarterly filers whose reporting period ended March 31st.
Annual filers with a return date in March, April or May have also had their remittance date extended to June 30th. Note, the requirement for businesses to file has not been deferred.
vii. Changes to Canada Summer Jobs Program. The CSJ was amended to increase the ability of employers to hire individuals by subsidizing 100% of the salary of CSJ-funded positions. The program was further extended from August 2020 to February 2021. This program represents an opportunity for both individuals and employers to benefit.
Jobs for individuals via the CSJ can be found at the Job Bank: https://www.jobbank.gc.ca/home. Details for employers on the expanded program can be found here: https://www.canada.ca/en/employment-social-development/services/funding/canada-summer-jobs/temporary-flexibility.html
This is just a summary of some programs of the available program at the Federal level; there are a number of commensurate programs that are also being offered at the Provincial level. We encourage you to be diligent, follow online sources, both Federal and Provincial, and consult your tax Advisors as well.