Subsidy and Benefit Information and Links for Canadian Small Businesses
Yes, these are interesting times. Trying to wade through the new (and ever changing) COVID-19 advice and information can feel like a fulltime job. When you’re running a small business at the same time it can quickly become overwhelming.
To help you out, we’ve pulled together a list of Federal, Provincial and private company resources currently available to Canadian small businesses. These programs, subsidies and benefits are designed to create a way forward so that your business will be ready to thrive when COVID-19 is a thing for the history books.
If you want to find out more, or the latest information, about any of these programs, click the linked headings.
Canada Emergency Business Account (CEBA)
Canadian Emergency Business Account is a $40,000 interest-free loan. This program is administered by your financial institution (where your business chequing account is held), so talk to your bank for details and to apply.
Your business should be eligible for a CEBA if it has been impacted by COVID-19 related events AND was not in default of any loans prior to the start of the impact AND paid out $20,000 to $1.5 million in total payroll in 2019.
Loan of up to $40,000. Up to 25% ($10,000) is forgivable on the loan if it is paid back by the due date.
0% interest until December 31, 2022.
The Canada Emergency Wage Subsidy (CEWS)
The Canadian Emergency Wage Subsidy is designed to help small businesses keep and rehire employees during the COVID-19 crisis. Apply for a CEWS through the Canada Revenue Agency. For more information check out the CEWS website and The Financial Post’s in-depth analysis of this subsidy.
Private sector employers that have seen at least a 15% drop in revenue in March 2020 and at least a 30% drop in the following months.
75% wage subsidy for eligible employers for up to 12 weeks.
Subsidies operate as grants.
Canada Emergency Commercial Rent Assistance (CECRA)
The Canadian Emergency Commercial Rent Assistance will reduce your commercial property rent by up to 75%. You will need to reach an agreement with your landlord though, so we will see how well this one plays out. Federal government has reached an agreement with every province, and this benefit is expected to be available in Mid-May 2020.
Tenants paying less than $50,000 a month in rent. Your operations have ceased or you have experienced at least a 70% drop in revenue.
The government will pay 50% of the rent directly to your landlord. You will pay 25% of the rent.
Your landlord must agree to forgive 25% of your rent and not to evict you for a specified term. Government provides a forgivable loan.
Tax Remittance Deferrals
Both federal and provincial tax programs have extended filing deadlines due to COVID-19. The following information is applicable to federal (CRA) taxation. Check your provincial tax information for province-specific information. Here in BC, the provincial government is extending filing and payment deadlines for most taxes until September 30, 2020. For more information, visit your provincial government’s website.
Most Canadian businesses are eligible.
This is not a tax subsidy, only a deferred payment schedule. Penalties and interest will not be charged if payment requirements are met by the posted due dates.
For full details as they relate to your circumstance, visit the CRA website Income Tax Filing and Payment Dates.
Mortgage Payment Deferrals
The mortgage payment deferral program is available to assist households who may have trouble paying their mortgage due to COVID-19. Contact the financial institution holding your mortgage to find out if you qualify and to apply.
Households with income loss due to COVID-19 may be eligible for up to 6 months of mortgage payment deferral.
Based on your current mortgage payments.
Note, like the tax deferral programs, this is not a grant. All interest and principal payments suspended during the deferral period will be payable at the end of period. Your lender will arrange payment terms with you before the deferral begins.
Be sure to ask about your credit rating impact when you discuss this option with your bank.
Canada Emergency Response Benefit (CERB)
If COVID-19 has halted your work, the Canada Emergency Response Benefit (CERB) may be able to provide you with temporary income support. Note this is not EI and not claimable alongside EI benefits. If you have not been paying into EI, you may still qualify!
Employed or self-employed Canadian residents who have stopped work due to COVID-19.
The CERB provides $500 a week for up to 16 weeks.
Under most circumstances, CERB funds will not need to be repaid.
Sale Leaseback Financing
This finance option can enable your business to access the equity in your owned equipment. A leaseback agreement allows your business to sell owned equipment to a leasing company who will in turn lease it back to you long term. Your business gets an infusion of cash while still having use of the equipment.
You must own the equipment outright in order to be eligible for leaseback financing.
Based on the appraised value of the equipment.
Flexible and arranged with the leasing company at the time of financing.
Interested in finding out more about Sale and Leaseback financing?
Give Thomcat Leasing a call (1-877-846-6228) and one of our friendly specialists will be happy to walk you through the details.
All the best to you and your business in these interesting times. Here’s looking forward to a brighter future and a swift end to COVID-19.
Stay well and safe.