Canada Emergency Wage Subsidy (CEWS) Information
Canada Emergency Wage Subsidy (CEWS) At-A-Glance:
UPDATE: CEWS Extended to August 29, 2020. Full news release here.
Finance Minister Bill Morneau announced thatthe Government of Canada will extend the CEWS by an additional 12 weeks to August 29, 2020. Government will consult with key business and labour representatives over the next month on potential adjustments to the program to incentivize jobs and growth, including the 30 per cent revenue decline threshold. Any potential changes following the consultation will have as key objectives to maximize employment, ensure the CEWS reflects the immediate needs of businesses, and support the post-crisis economic recovery.
DETAILED INFORMATION ABOUT CANADA'S EMERGENCY RESPONSE PLAN FOR BUSINESSES & CEWS
Access to credit:
Supporting financial stability:
Prime Minister Justin Trudeau announced in March additional new measures to support small businesses dealing with the economic impacts of the pandemic to help Canadian businesses protect the jobs that Canadians depend on, and pay their workers and bills during these difficult times:
- A 75% wage subsidy of up to $58,700 per employee (up to $847 per week) for qualifying businesses, for up to 3 months, retroactive to March 15, 2020 to June 6, 2020. This will help businesses to keep and return workers to the payroll. More details on eligibility criteria will start with the impact of COVID-19 on sales, and will be shared before the end of the month. More details available here.
- Allow businesses, including self-employed individuals, to defer all Goods and Services Tax/Harmonized Sales Tax (GST/HST) payments until August 29, 2020, as well as customs duties owed for imports. This measure is the equivalent of providing up to $30 billion in interest-free loans to Canadian businesses. It will help businesses so they can continue to pay their employees and their bills, and help ease cash-flow challenges across the country.
- Launch the new Canada Emergency Business Account. This program will provide up to $25 billion to eligible financial institutions so they can provide interest-free loans to small businesses. These loans – guaranteed and funded by the Government of Canada – will ensure that small businesses have access to the capital they need, at a zero per cent interest rate, so they can pay for rent and other important costs over the next number of months.
- Launch the new Small and Medium-sized Enterprise Loan and Guarantee program that will enable up to $40 billion in lending, supported through Export Development Canada and Business Development Bank, for guaranteed loans when small businesses go to their financial institutions to help weather the impacts of COVID-19. This is intended for small and medium-sized companies that require greater help to meet their operational cash flow requirements.
- The full news release can be found here.
On April 1, Finance Minister Bill Morneau, the Minister of Small Business, Export Promotion and International Trade, Mary Ng, and the Minister of Innovation, Science and Industry, Navdeep Bains, announced the details of the proposed Canada Emergency Wage Subsidy:
- The Canada Emergency Wage Subsidy would apply at a rate of 75 per cent of the first $58,700 normally earned by employees – representing a benefit of up to $847 per week. The program would be in place for a 12-week period, from March 15 to June 6, 2020. Eligible employers who suffer a drop in gross revenues of at least 30 per cent in March, April or May, when compared to the same month in 2019, would be able to access the subsidy.
- Eligible employers would include employers of all sizes and across all sectors of the economy, with the exception of public sector entities.For non-profit organizations and registered charities similarly affected by a loss of revenue, the government will continue to work with the sector to ensure the definition of revenue is appropriate to their circumstances.
- The government is also considering additional support for non-profits and charities, particularly those involved in the front line response to COVID-19. Further details will be announced in the near term.
- An eligible employer’s entitlement to this wage subsidy will be based entirely on the salary or wages actually paid to employees.
- All employers would be expected to at least make best efforts to top up salaries to 100% of the maximum wages covered.
- Eligible employers would be able to access the Canada Emergency Wage Subsidy by applying through a Canada Revenue Agency online portal. More details regarding how to apply for the program will follow.
- Those organizations that do not qualify for the Canada Emergency Wage Subsidy may continue to qualify for the previously announced wage subsidy of 10 per cent of remuneration paid from March 18 to before June 20, up to a maximum subsidy of $1,375 per employee and $25,000 per employer.
WHERE TO START
for Canadian business owners, entrepreneurs, artists, and those who are self-employed:
- Visit Canada's website for businesses for information about supporting your employees and your business. It will be constantly updated as the COVID-19 crisis evolves.
- Download the Canada Business App to find tailored supports to address your specific needs and questions about COVID-19.
- Consult the Canadian Chamber of Commerce’s pandemic preparedness guide to help prepare your business in the days and weeks to come.
- Contact your bank. Canada’s banks have made a commitment to support businesses and individuals through these difficult times in a responsible, fair, and compassionate way. To help provide some stability for businesses through this time of uncertainty, the Office of the Superintendent of Financial Institutions (OSFI) is lowering the Domestic Stability Buffer requirement, releasing more than $300 billion of additional lending capacity for Canadian financial institutions.
- The Department of Finance Canada has a thorough resource here outlining how the government is taking action to help Canadians experiencing hardship, including detail about flexibility for taxpayers.
- The Government is essentiall eliminating the payroll tax for three months by providing a 10% wage subsidy to small businesses – this will keep people employed. More details here.
- The Government is also helping businesses with cash flow by deferring tax payments until August 31st;
- Applications will open in April through your Canada Revenue Agency (CRA) "My Account" portal, your My Service Canada account, and a TBA toll free number equipped with an automated application process.
Read the full news release from the office of Prime Minister Justin Trudeau, outlining Canada's $82 billion support and relief plan for Canadians.