Federal Government COVID-19 Response Plan
On March 18, 2020, the federal government announced up to $27 billion in direct support to Canadian workers and businesses. These supports include:
- Updated | Wage Subsidies for Small Businesses
The subsidy has been increased to up to 75% as of Mar 27, 2020. More details to come.
To support businesses that are facing revenue losses and to help prevent lay-offs, the Federal Government is proposing to provide eligible small employers a temporary wage subsidy for a period of three months. The subsidy will be equal to 10% of remuneration paid during that period, up to a maximum subsidy of $1,375 per employee and $25,000 per employer. Businesses will be able to benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration. Employers benefiting from this measure will include corporations eligible for the small business deduction, as well as non-profit organizations and charities.
- New | Canada Emergency Business Account
Banks will soon offer $40,000 loans, guaranteed by the Federal government to qualifying businesses. These loans will be interest-free in the first year and, if your business meets certain conditions, $10,000 will be forgivable.
- Business Credit Availability Program
On March 13, 2020, the Federal government established a Business Credit Availability Program (BCAP) to support financing in the private sector through Business Development Bank of Canada (BDC) and Export Development Canada (EDC). This will allow BDC and EDC to provide more than $10 billion of additional support to businesses through coordination of financing and credit insurance solutions for Canadian businesses. These include:
- Deferral of Business Filing Taxes
The Canadan Revenue Agency will allow all businesses to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after March 18, 2020 and before September 2020. This relief would apply to tax balances due, as well as instalments, under Part I of the Income Tax Act. No interest or penalties will accumulate on these amounts during this period.
- New | Deferral of GST, HST, and duties and taxes owed on imports
GST, HST, and duties and taxes owed on imports will be delayed until June 2020.
- Extended Work-Sharing Program
The work-sharing program is an adjustment program designed to help employers and employees avoid layoffs when there is a temporary reduction in the normal level of business activity that is beyond the control of the employer. The measure provides income support to employees eligible for EI benefits who work a temporarily reduced work week while their employer recovers.
Provincial Government BC COVID-19 Action Plan
On March 23, 2020, the Province of BC announced $5 billion in funding to provide relief for people, businesses and services, including $2.2 billion for businesses to provide relief and help them recover after the outbreak. These supports include:
- Tax payment deferral
The following tax filing and payment deadlines have been deferred until Sept. 30, 2020.
- Employer health tax on businesses with a payroll over $500,000. Businesses with a payroll under this threshold are already exempt from the tax.
- Provincial sales tax
- Municipal and regional district tax on short-term accommodation
- Tobacco tax
- Motor fuel tax
- Carbox tax
- School taxes cut in half for business and light- and major-industry property classes