Canadian Shipper


Summary of government help available to businesses during COVID-19

The federal government is rolling out a massive aid package for businesses affected by COVID-19, including billions in wage subsidies and credit.

A guide to the aid package for businesses affected by COVID-19, has been produced by Advisor’s Edge, a Newcom Media publication. (See the table below for a summary of the programs available to business owners during the pandemic.)

The Canada Emergency Business Account and loan programs listed are part of the government’s Business Credit Availability Program (BCAP) of $65 billion in direct lending to small and medium-sized businesses. The BCAP will be administered by Export Development Canada (EDC) and the Business Development Bank of Canada (BDC ), with loans co-ordinated through banks or other financial institutions. Full details are forthcoming.

No limit exists for BCAP support to a single business.

Support for business owners during COVID-19 include:

Canada Emergency Wage Subsidy

  • 75% of wages of the first $58,700 normally earned by employees, up to $847/week
  • No overall limit
  • Reduced by any amounts received under the temporary 10% wage subsidy
  • Taxable income
  • Retroactive from March 15 to June 6
  • Includes individuals, taxable corporations and partnerships with a monthly revenue drop of at least 30% year over year
  • Apply through CRA’s My Business Account portal as well as a web-based application

Temporary wage subsidy for employers

  • 10% of wages, up to a max of $1,375 per employee and $25,000 per employer
  • Associated CCPCs aren’t required to share the max subsidy of $25,000
  • Taxable income
  • March 18 to June 19
  • Includes individuals, partnerships and corporations eligible for the small business deduction
  • No need to apply
  • Employers reduce their payroll remittances of income tax by the amount of the subsidy. More information here.

Work-sharing program (provides EI benefits to workers with reduced hours, helping avoid layoffs)

  • Extended to 76 weeks from 38
  • March 15, 2020, to March 14, 2021
  • Any sector or industry
  • The business must have been in operation for one year (instead of the usual two)
  • Submit applications to Service Canada 10 calendar days prior to the requested start date (instead of the usual 30). More information here.

Canada Emergency Business Account

  • Loans of up to $40,000
  • No interest for the first year, according to the BDC website, but several banks are extending the period to Dec. 31, 2022
  • Loan forgiveness of 25% if repaid on or before Dec. 31, 2022
  • Available mid-April
  • Employers with $50K to $1M in payroll
  • With your current financial institution

Loan Guarantee for Small and Medium-Sized Enterprises

  • Up to $6.25M in new operating credit and cash-flow term loans
  • Available mid-April
  • Credit-worthy businesses whose activities fall within the EDC’s mandate
  • With your current financial institution

Co-lending Program for Small and Medium-Sized Enterprises

  • Up to $6.25M for operational cash-flow requirements
  • Commercial interest rate
  • 10-year repayment
  • Available mid-April
  • Credit-worthy businesses whose activities fall within the BDC’s mandate
  • With your current financial institution

In addition to the measures in the table, businesses can defer to Sept. 1 taxes that become owing on or after March 18. GST payment and customs duties are extended to June 30. The CRA says it won’t contact small or medium businesses regarding post-assessment income tax and GST/HST audits for the next month.

Farmers can receive credit through Farm Credit Canada, and those with loans due from the Advance Payment Program on or before April 30 have an additional six months to pay.

Read the Advisor’s Edge summary of all government aid for individuals and businesses here.

Print this page

Related Posts

Have your say:

Your email address will not be published. Required fields are marked *