COVID-19 Updates for Individuals & Business Owners

COVID-19 Updates for Individuals & Business Owners

April 22, 2020,
Dear Clients & Friends,

I wanted to take this opportunity to provide you with the most up to date changes to the CRA benefits related to COVID-19 since my last update on April 10. Note that all my COVID-19 updates are updated on our website at www.arjcpa.ca

Furthermore, please connect and follow the links to my social media at your convenience (Facebook, Twitter, LinkedIn, Instagram) to stay fully updated on COVID-19 and tips & tax planning for individuals & businesses.

For Individuals

1. Canada Emergency Response Benefit (CERB) Update:

On April 15, CRA announced the following changes to the eligibility rules:

• Allows people to earn up to $1,000 per month while collecting the CERB.
• Extend the CERB to seasonal workers who have exhausted their EI regular benefits and are unable to undertake their regular seasonal work because of COVID-19.
• Extend the CERB to workers who have recently exhausted their EI regular benefits and are unable to find a job because of COVID-19.
• If individuals receive non-eligible dividends from the business, you could be eligible for the CERB as long as you meet the requirements of having earned a minimum of $5K income in 2019. Non-eligible dividends also count toward the $1000 income threshold for a benefit period.

If you require assistance with the application process, please don’t hesitate to contact us.

Full details are available on the CRA Website at: https://www.canada.ca/en/department-finance/economic-response-plan.html#individuals

2. Canada Emergency Student Benefit (CESB):

This morning, Prime Minister Trudeau announced benefits for students:

• Eligible students include postsecondary students currently in school, those planning to start postsecondary school in September or those who graduated in December 2019
• Working students earning less than $1,000 per month are also eligible
• The eligibility period covers May 1st to Aug 31st.
• The benefit amount is $1,250 per month
• If you are supporting another person or if the student has a disability, the benefit is up to $1,750 per month
• The government will also be creating 76,000 new jobs specifically for post-secondary students within sectors contributing to the fight against COVID-19

Income Tax Reminder

A gentle reminder to submit your personal tax documents if you have not done so for us to be able to complete and file your tax returns by the extended deadline of June 1st. You many send the documents digitally (either via dropbox, google drive, box or secured email).

For Businesses

1. The Canada Emergency Business Account (CEBA) Update:
• Last week the government made some changes to CEBA.
• The new qualification requirements have been extended to allow for organizations to demonstrate they paid between $20,000 to $1.5 million in total payroll in 2019.
• The government will then provide interest-free loans of up to $40,000 to small businesses and not-for-profits, to help cover their operating costs during a period where their revenues have been temporarily reduced.
• Repaying the balance of the loan on or before December 31, 2022 will result in a loan forgiveness of 25 percent (up to $10,000).
• Business owners can apply for support from the Canada Emergency Business Account through their banks and credit unions.

Further information is available at: https://ceba-cuec.ca

2. Canada Emergency Commercial Rent Assistance (CECRA):
• Last week the government announced its intent to establish assistance to commercial property owners who will in turn lower or forgo the rent of small businesses for April, May and June
• This will include assistance and/or forgivable loans
• Implementation of the program will be in partnership with the provincial governments
• Details will be provided by the government soon
3. Canada Emergency Wage Subsidy (CEWS) Update:
• As a Canadian employer whose business has been affected by COVID-19, you may be eligible for a subsidy of 75% of employee wages for up to 12 weeks, retroactive from March 15, 2020, to June 6, 2020. This will allow employers to re-hire workers previously laid off as a result of COVID-19.
• CRA has launched a calculator as of yesterday to determine the amount of the subsidy.
• Applications will be accepted as of April 27, 2020
• The program will be available through My Business Account or through the Represent a Client service for Accountants
• There will be an automatic audit for all employers to ensure compliance with the program
• The government hopes to process the applications by May 5th. They expect at least a million applications

Full details on the calculator and process are available at: https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html

As trusted advisors, we realize the application process may be a little complicated and are therefore working with our clients to assist with the applications. As these applications will play a critical role to your cash flows, we recommend that you try and apply as soon as possible. Please contact us at your convenience and we would be happy to provide this service.

Stay Safe!