During these unprecedented times, the federal government has announced a variety of incentives to assist Canadian businesses.  This bulletin summarizes pertinent federally-announced COVID incentives for businesses.  We expect additional announcements will be made to further address support for Canadian businesses in the coming days.

  1. 75% Canada Emergency Wage Subsidy (CEWS)- The CEWS will provide a subsidy to employers equal to 75% of the employees’ remuneration to a maximum of $847 per week per employee. This subsidy can cover remunerations up to 12 weeks retroactive to March 15, 2020.  To be eligible for this subsidy, you will need to be able to show that your arms-length monthly revenues have decreased by at least 30% from the same month last year.  An online application portal will be put up on the CRA website in the coming weeks, as well as a link from myCRA.  You will need to apply monthly for the CEWS.  Draft legislation has not been released for this program yet, so changes will likely be made from the original announcement.
  2. 10% Temporary Wages Subsidy Program– If you are a CCPC that qualifies for the small business deduction, you will be eligible for a 10% wage subsidy up to $1,375 per employee (and $25,000 per employer).  This wage subsidy can be deducted from your payroll remittances.
  3. EDC and BDC loans- under the Business Credit Availability Program (BCAP), the federal government has provided both organizations with additional $10 billion of funds for business loans to target SMEs.   Contact BDC and EDC directly to apply for these loans.
  4. Federal income tax deferrals– the deadline for amounts that become owing or due from March 18 up to September 1, 2020 has been extended to September 1, 2020. This includes balances of income tax owing from the 2019 taxation year, as well as income tax instalment payments that become due as of March 18, 2020 and before September 1, 2020. This deferral will not come with any interest or penalties. 
  5. Tax filing deadline extension for businesses– The income tax return filing due date for the current tax year has been extended to June 1, 2020, for corporations that have normally have filing due dates after March 18, 2020, and before June 1, 2020.
  6. GST/HST deferrals- the Federal Government announced a deferral of Goods and Services Tax/Harmonized Sales Tax (GST/HST) remittances to June 30, 2020. However, the federal announcement did not include a deferral of the filing due-date for GST/HST returns. 
  7. Deferrals of Customs Duty and Sales Tax for Importers- Typically, payments owing for customs duties and the GST on imports are due before the first day of the month following the month in which the Statements of Accounts are issued. Payment deadlines for statements of accounts for March, April, and May are being deferred to June 30, 2020.
  8.  SR&ED claims- You may want to consider filing your SR&ED claim as soon as possible, if your fiscal year has already been completed in order to potentially receive your return sooner.  The March 18, 2020 announcement confirmed that the CRA will not contact any small or medium-sized (SME) businesses in the next four weeks to commence any GST/HST or income tax audits, but it is uncertain whether this would extend to SR&ED audits.