Communitech Highlights Financial Support for Businesses and Employees
~shared with permission from Communitech
A full rundown of federal government supports for businesses can be found here, but here’s a quick(ish) overview:
To help businesses hold on to their employees, the federal government is providing a temporary wage subsidy equal to 75% for the first $58,700 of salary, up to $847 per week. All businesses – the number of employees on the payroll doesn’t matter – that have seen revenue drop by 30% or more because of COVID-19 are eligible for the wage subsidy. This measure is retroactive to March 15. Businesses can re-hire recently let-go workers and place them on subsidized wages. The Department of Finance will release technical information (e.g. how to obtain the wage subsidy) for employers in the coming days.
To help businesses avoid layoffs, the federal government is also enhancing the Work-Sharing Program. The program works this way: Instead of being laid off, multiple workers’ hours and pay are reduced, with the federal government making up the shortfall in the workers’ income.
More credit is available to Canadian businesses through the new Business Credit Availability Program (BCAP). You can access the BCAP via BDC or EDC.
Through the Canada Emergency Business Account, banks will soon offer $40,000 loans, guaranteed by the government and interest-free for the first year, to small businesses. If recipients meet certain conditions, $10,000 will be forgivable. The government will release more details in the coming days.
More generally, the federal government is providing additional liquidity to Canadian banks. In return, the banks have committed to working with companies to help them get through COVID-19. Talk to your bank if you haven’t already done so.
Businesses can defer, until after Aug. 31, the payment of any income tax amounts that become owing on or after March 19 and before September. In addition, GST/HST payments, as well as duties and taxes owed on imports, are deferred until June.
In Ontario, the provincial government is helping businesses with cash flow through a number of measures: payment of most provincial taxes is deferred for five months without penalty or interest; Workplace Safety and Insurance Board (WSIB) payments are deferred for six months; municipalities will be providing property tax relief; and most businesses are not required to pay the Employer Health Tax.