COVID-19 Information & Resources

On this page you will find up-to-date information regarding the economic measures put forth by the Canadian and Ontario governments in response to the COVID-19 (coronavirus) pandemic. MDP is committed to helping clients and web visitors get the information they require during this time of need. Our firm is open during regular business hours to provide support to clients and new customers. For more information, please contact us.

Click on a section below to reveal more information.

These are strange times.  Our firm is committed to ensuring the health and welfare of both our clients and our staff.  Our office is closed to all but document drop off and pick up.  Most of our staff are now working remotely and will be available via emails and phone.  We will be refraining from any on-site client visits.  The few staff remaining in the office are there to receive documents being dropped off only.  We will not be meeting with any clients in person but can conduct meetings via conference calls.

We would also encourage clients to make use of our client upload link via Citrix Sharefile in order to send in scanned documents where possible. Files can be uploaded here: https://www.mdp.on.ca/upload/

This situation is causing disruptions in normal service across all industries and we appreciate your cooperation and patience as we all adapt to the changes we are faced with.  It is our desire to provide continued service while at the same time ensuring everyone remains healthy and safe.

Individuals
The return filing due date is deferred until June 1, 2020.

The payment due date is deferred to September 1, 2020. This applies to any income tax amounts that become owing on or after March 18, 2020 and before September 2020. This relief would also 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.

No late-filing penalties or interest will be charged if the 2019 individual income tax return is filed and payments are made prior to September 1, 2020.

The extension also applies to all elections, forms and schedules that must be filed with the tax return.

Self-Employed Individuals (& Spouses/Common-Law Partners)
The return filing due date will remain at June 15, 2020.

The deadline to pay any balance due has been extended from April 30, 2020, to September 1, 2020.

Trusts
For trusts having a taxation year ending on December 31, 2019, the return filing due date is deferred until May 1, 2020.

Filing for trusts that would otherwise have a filing due date in April or May is extended to June 1, 2020.

Filing for trusts that would otherwise have a filing due date in June, July and August is extended to September 1, 2020.

The payment due date is deferred to September 1, 2020. This applies to any income tax amounts that become owing on or after March 18, 2020 and before September 2020. This relief would also 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.

No late-filing penalties or interest will be charged if the trust income tax return is filed and payments are made prior to September 1, 2020.

Partnerships
Filing for partnerships that would otherwise have a filing due date on March 31 is extended to May 1, 2020.

Filing for partnerships that would otherwise have a filing due date after March 31 and before May 31 is extended to June 1, 2020.

Filing for partnerships that would otherwise have a filing due date on May 31, in June / July / August is extended to September 1, 2020.

NR4
The filing due date for NR4 information return is extended to May 1, 2020.

Businesses
The return filing due date that is otherwise after March 18 and before June 1, 2020 is deferred until June 1, 2020.

Filing for corporations that would otherwise have a filing due date in June / July / August is extended to September 1, 2020.

The payment due date is deferred to September 1, 2020. This applies to 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.

The extension also applies to all elections, forms and schedules that must be filed with the tax return.

GST/HST Remittance
The due dates for the following remittances is extended to June 30, 2020

• Monthly filers – remittance regarding February, March and April 2020 reporting periods;

• Quarterly filers – remittance regarding amounts collected for the January 1, 2020 through March 31, 2020 reporting period; and

• Annual filers – whose GST/HST return, payment or instalment that are due in March, April or May 2020

The deadline for businesses to file their returns is unchanged. The CRA will not impose penalties where a return is filed late provided that it is filed by June 30, 2020.

If the business is unable to satisfy its balance owing when it becomes due, the directors’ may be held personally liable.

Charities
The filing deadline for all charities’ Form T3010, Registered Charity Information Return due between March 18, 2020 and December 31, 2020 has been extended to December 31, 2020.

SR&ED & ITC
No extension or relief.

Customs Duty and Sales Tax for Importers
Payment deadlines for March, April, and May are being deferred to June 30, 2020.

Payroll Deductions
No extension or relief, except to the extent they related to the reduction of remittances relates to the temporary wage subsidy)

Filing of Other Returns/Forms/Elections/Designations/Etc.
Filing that would otherwise have a filing due date after March 18 and before May 31 is extended to June 1, 2020.

Filing that would otherwise have a filing due date on May 31, in June / July / August is extended to September 1, 2020.

On March 18, 2020, the Prime Minister announced the following measures to help stabilize the economy.

Support to Canadians

Temporary Income Support for Workers and Parents
For Canadians without paid sick leave who are sick, quarantined or forced to stay home to care for children, the Government is:

  • Waiving the Employment Insurance (EI) sickness benefit one-week waiting period for those individuals in imposed quarantine.
  • Waiving the requirement to provide a medical certificate to access EI sickness benefits.
  • Introducing the Canadian Emergency Response Benefit (CERB) – combination of previously announced Emergency Care Benefit and Emergency Support Benefit.

https://www.canada.ca/en/department-finance/news/2020/03/introduces-canada-emergency-response-benefit-to-help-workers-and-businesses.html

  • Canadians who have lost their job, are sick, quarantined, or taking care of someone who is sick with COVID-19, as well as working parents who must stay home without pay to care for children who are sick or at home because of school and daycare closures. The CERB would apply to wage earners, as well as contract workers and self-employed individuals who would not otherwise be eligible for Employment Insurance (EI)..
  • workers who are still employed, but are not receiving income because of disruptions to their work situation due to COVID-19, would also qualify for the CERB

Application for the Benefit will be available in April 2020, and require Canadians to attest that they meet the eligibility requirements. They will need to re-attest every two weeks to reconfirm their eligibility. Canadians will select one of three channels to apply for the Benefit:

  1. by accessing it on their CRA My Account secure portal;
  2. by accessing it from their secure My Service Canada Account; or
  3. by calling a toll free number equipped with an automated application process.

Longer-Term Income Support for Workers
For Canadians who lose their jobs or face reduced hours as a result of COVID’s impact, the Government is:

  • Introducing an Emergency Support Benefit to provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment.
  • Implementing the EI Work Sharing Program, which provides EI benefits to workers who agree to reduce their normal working hour as a result of developments beyond the control of their employers.

Income Support for Individuals Who Need It Most
The Government is proposing to provide a one-time special payment by early May 2020 through the Goods and Services Tax credit (GSTC). This will double the maximum annual GSTC payment amounts for the 2019-20 benefit year. The average boost to income for those benefitting from this measure will be close to $400 for single individuals and close to $600 for couples.

The Government is proposing to increase the maximum annual Canada Child Benefit (CCB) payment amounts, only for the 2019-20 benefit year, by $300 per child. The overall increase for families receiving CCB will be approximately $550 on average; these families will receive an extra $300 per child as part of their May payment.

To ensure that certain groups who may be vulnerable to the impacts of COVID-19 have the support they need, the Government is proposing targeted help by:

  • Placing a six-month interest-free moratorium on the repayment of Canada Student Loans.
  • Reducing required minimum withdrawals from Registered Retirement Income Funds (RRIFs) by 25% for 2020. Similar rules would apply to defined contribution Registered Pension Plan.

Flexibility for Taxpayers
The Canada Revenue Agency will defer the filing due date for the 2019 tax returns of individuals, including certain trusts.

  • For individuals, the return filing due date will be deferred until June 1, 2020.
  • For self-employed individuals or those who have spouses or common-law partners that are self-employed, the deadline to pay any balance due for your individual income tax and benefit return has been extended from April 30, 2020, to September 1, 2020.
  • For trusts having a taxation year ending on December 31, 2019, the return filing due date will be deferred until May 1, 2020.

The Canada Revenue Agency will allow all taxpayers to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today 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.

Penalty and interest implications for upcoming trust tax obligations not covered by the relief described above will be considered by the CRA on a case-by-case basis.

Effective immediately the Canada Revenue Agency will recognize electronic signatures as a temporary administrative measure.

Role of Financial Institutions
Banks in Canada have affirmed their commitment to working with customers to provide flexible solutions, on a case-by-case basis, for managing through hardships caused by recent developments. This may include situations such as pay disruption, childcare disruption, or illness. Canada’s large banks have confirmed that this support will include up to a 6-month payment deferral for mortgages, and the opportunity for relief on other credit products.

Mortgage Default Management Tools
The Canada Mortgage and Housing Corporation (CMHC) and other mortgage insurers offer tools to lenders that can assist homeowners who may be experiencing financial difficulty. These include payment deferral, loan re-amortization, capitalization of outstanding interest arrears and other eligible expenses, and special payment arrangements.

Support to Businesses

Helping Businesses Keep their Workers
The 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.

Flexibility for Businesses Filing Taxes
The Canada 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 today 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.

The Canada Revenue Agency will not contact any small or medium (SME) businesses to initiate any post assessment GST/HST or Income Tax audits for the next four weeks. For the vast majority of businesses, the Canada Revenue Agency will temporarily suspend audit interaction with taxpayers and representatives.

Any objections related to Canadians’ entitlement to benefits and credits have been identified as a critical service which will continue to be delivered during COVID-19. With respect to objections related to other tax matters, CRA is currently holding all other objections in abeyance. No collection action will be taken with respect to these accounts during this period of time.

On March 16, 2020, the Tax Court of Canada has ordered the extension of all timelines prescribed by the rules of that Court while it is closed for business until March 30, 2020.

Ensuring Businesses Have Access to Credit
The Business Credit Availability Program (BCAP) will allow the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) to provide more than $10 billion of additional support, largely targeted to small and medium-sized businesses.

The Bank of Canada also took a series of actions to support the Canadian economy. This included cutting the interest rate to 0.75% as a proactive measure.

Conclusion

We at MDP will continue to monitor the status of the legislation and advise accordingly. If you would like to discuss the above in regards to your specific situation, please contact us.

Other announcements

  • The filing deadline for all charities’ Form T3010, Registered Charity Information Return due between March 18, 2020 and December 31, 2020 has been extended to December 31, 2020.
  • Collections activities on new debts will be suspended until further notice.
  • Effective immediately, the CRA will not be sending any “Requirements to PAY” (RTP) to employers.
  • For RTPs currently in place, remittances are not required, until further notice.
  • The CRA also requests that any RTPs that one may receive this week not be actioned.
  • The exemption from the Ontario Employer Health Tax (EHT) will be increased from $490,000 to $1 million retroactive to January 1, 2020.
  • Businesses can defer remitting WSIB premiums for the period starting March 25 and ending August 31, 2020, with no penalty or interest. Interest on outstanding premium payments will also cease to accrue.
  • Beginning April 1 and up until August 31, 2020, businesses will not incur any penalty or interest on Employer Health Tax, Tobacco Tax, Fuel Tax, Gas Tax, Beer, Wine and Spirits Taxes, Mining Tax, Insurance Premium Tax, International Fuel Tax Agreement, Retail Sales Tax on Insurance Contracts and Benefit Plans and Race Tracks Tax
  • MPAC property assessment will be postponed to 2021

IRS Notice 2020-18 states that the due date for an individual, a trust, estate, partnership, association, company or corporation that is normally on April 15, 2020 is automatically postponed to July 15, 2020. This includes the filing of Federal income tax returns, Federal income tax payments (including payments of tax on self-employment income), and the 1st quarter federal estimated income tax payment. No extension is provided for the filing of any Federal information return.

It is expected that the deadline for New York state tax return will also be extended to July 2020.

Executive Order 202.8 was passed, which directs the NYS Department of Taxation and Finance to extend the filing period for sales and use taxes due March 20, 2020 (for the period ending February 29, 2020), for a period of 60 days.

New York City has issued a statement that they will waive all late filing, late payment or underpayment penalties for business and excise taxes due between March 16, 2020 and April 25, 2020. It is important to note that interest is not waived, and the statement does not refer to individual taxes.

The Families First Coronavirus Response Act was passed on Wednesday, March 18, 2020. The provisions will go into effect on April 2, 2020, which expanded the Emergency Paid Sick and Family Medical leave. The IRS recently released IR 2020-57 on March 21, 2020 to help answer some ongoing questions.

The third Coronavirus Bill, Senate Bill 3548, looks to increase the eligibility by expanding the definition of businesses eligible for the SBA loans to include private non-profit organizations, or public non-profit organizations which employ not more than 500 employees. Previously, the SBA Disaster loans offer designated states and territories low-interest federal disaster loans for working capital to small businesses and non-profit organizations who are suffering substantial economic injury. All of New York State has been designated an eligible disaster area.

On March 27, the federal government announced an enhancement to the previously enacted Temporary Wage Subsidy. Further details were released on April 1, 2020 and on April 8, 2020. The legislation received Royal Assent on April 11, 2020.

Eligibility

Eligible employers include:

  • Individuals (including trusts)
  • taxable corporations
  • Partnerships consisting of eligible employers
  • Non‑profit organizations and registered charities.

An eligible employer must have an existing business number and payroll program account with the CRA on March 15, 2020.

Third party payroll administrators cannot currently apply for the wage subsidy on behalf of an employer by using their own business number and payroll program account. On June 10, 2020, it was proposed (not enacted yet) that this restriction be removed.

Eligible employers would be required to attest a drop in revenue. The table below outlines each claiming period and the period in which it has a decline in revenue of 15 / 30 per cent or more.

 

Claiming period

 

Reference period for eligibility

 

Required reduction in revenue
Period 1March 15 – April 11March 2020 over:

• March 2019 or

• Average of January and February 2020

 

15%
Period 2

 

April 12 – May 9Eligible for Period 1, OR

 

April 2020 over:

• April 2019 or

• Average of January and February 2020

 

30%
Period 3

 

May 10 – June 6Eligible for Period 2, OR

 

May 2020 over:

• May 2019 or

• Average of January and February 2020

 

30%
Period 4

 

June 7 – July 4To be announced

 

To be announced

 

Period 5

 

July 5 – August 1To be announced

 

To be announced

 

Period 6

 

August 2 – August 29To be announced

 

To be announced

 

 

It was announced that the CEWS program will be extended to August 29, 2020.

Eligible employers who met the revenue decline test in a period would automatically qualify for the immediately subsequent period.

Employers would be allowed to choose to compare revenue with the corresponding month in 2019 or the average of revenue in January and February 2020. Once determined, the same option must be used for the subsequent periods.

Definition of Revenue

Revenue for this purpose would be revenue in the course of the ordinary activities in Canada earned from arm’s-length sources.

Revenue would be calculated using the employer’s normal accounting method

Employers would be allowed to calculate their revenues under the accrual method or elect to use the cash method, but not a combination of both. Once a calculation method is chosen, the same method must be used for the entire duration of the program.

Revenue from extraordinary items and amounts on account of capital would be excluded.

To the extent that investment revenue, such as interest or dividends from investments in securities, arises in the course of an eligible employer’s ordinary activities in Canada in the particular period, is not an extraordinary item or on account of capital, and is included in revenue under its normal accounting practices, it would generally be included in qualifying revenue.

Affiliated group may elect to compute revenue on a consolidated basis.

For eligible employer whose income is from a joint venture, the eligible employer may compute its revenue using the revenue of the joint venture if:

  • The eligible employer is wholly owned by the participant(s) of the joint venture, and
  • All or substantially all (more than 90%) of the income of the eligible employer is from the joint venture.

For eligible employer whose income is from non-arm’s length person or partnerships, the eligible employer may compute its revenue using the revenue of the non-arm’s length party if:

  • The eligible employer and the non-arm’s length party elect jointly, and
  • All or substantially all (more than 90%) of the income of the eligible employer is from the non-arm’s length party.

For registered charities and non-profit organizations,

  • The calculation will include most forms of revenue, excluding revenues from non-arm’s length persons.
  • These organizations can choose whether or not to include funding from government sources as part of the calculation. Once chosen, the same approach would have to apply throughout the program period.

Amount

The subsidy is calculated on eligible remuneration paid between March 15 and August 29, 2020, and would be the greater of:

  • The least of:
    • 75 per cent of the amount of remuneration paid
    • $847 per week
    • $0 with respect to non-arm’s length employees
  • The least of:
    • 100 per cent of the amount of remuneration paid
    • 75 per cent of the employee’s pre-crisis weekly remuneration
    • $847 per week

Employers will be eligible for a subsidy of up to 75 per cent of salaries and wages paid to new arm’s length employees. For non-arm’s length employees, the subsidy would only be available for those who were employed and paid prior to March 15, 2020.

Owner-managers who compensate themselves with solely dividend would not be eligible for this subsidy.

For employee employed by more than one employer who do not deal with each other at arm’s length, the maximum subsidy is to be computed as if the employee was employed by only one employer.

Eligible remuneration may include salary, wages, and other remuneration like taxable benefits. These are amounts for which employers would generally be required to withhold or deduct amounts to remit to the Receiver General on account of the employee’s income tax obligation. It does not include:

  • severance pay
  • stock option benefits
  • personal use of corporate vehicle
  • an increase in remuneration, where one of the main purposes is to increase the amount of subsidy under this program.

The “pre-crisis remuneration” would be based on the average weekly remuneration paid between January 1 and March 15, 2020 inclusively, excluding any seven-day periods in respect of which the employee did not receive remuneration. On May 15, 2020, it was proposed (not enacted yet) that “pre-crisis remuneration” could alternatively be based on average weekly remuneration paid between March 1, 2019 and May 31, 2019.

An employer would not be eligible to claim the CEWS with respect to employees who have been without remuneration for 14 or more consecutive days in the eligibility period. For employers who is rehiring its employee as a result of this CEWS program, the employees can cancel their CERB claim and repay that amount as follow:

Return or repay CERB

The CERB can be repaid under one of the following methods:

  1. Return the CERB cheque by mail to

Revenue Processing – Repayment of CERB
Sudbury Tax Centre
1050 Notre Dame Avenue
Sudbury ON P3A 0C3

  1. Mail a cheque, made payable to “Receiver General for Canada”, to the above address. Please include your Social Insurance Number (Sin), and indicate it is for “Repayment of CERB”.

Employers who remunerate its employees for an entire week but the employee does not perform any work for the employer would be eligible for a special refund of 100 per cent for the employer portion of Employment Insurance (EI), the Canada Pension Plan (CPP), the Quebec Pension Plan (QPP), and the Quebec Parental Insurance Plan (QPIP) with respect to that employee for that week.

Any benefit from the 10% Temporary Wage Subsidy paid and the Work-Sharing Program in a specific period would reduce the amount available to be claimed under the CEWS in that same period.

How to apply and timing

Please refer to the link to download the calculation spreadsheet as provided by the Canada Revenue Agency.

https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy/cews-calculate-subsidy-amount.html

Beginning April 27, 2020, eligible employers can apply for CEWS using:

  • My Business Account

https://www.canada.ca/en/revenue-agency/services/e-services/e-services-businesses/business-account.html

  • An online application form, which will be available on April 27, 2020

It is also possible to apply under the Represent a Client portal.

The subsidy benefit will generally be issued by the CRA within 10 business days upon application.

Businesses must file an application before October 2020.

Other

Penalties, fines or even imprisonment may apply in cases of fraudulent claims. Employers that engage in any artificial transactions to reduce revenue, where one of the main purposes is to increase the amount of subsidy, would be subject to a penalty equal to 25 per cent of the value of the subsidy claimed, in addition to the requirement to repay in full the subsidy that was improperly claimed.

The subsidy is reportable as income in the year in which the subsidy is received.

Employers will be expected to report the amount of the wage subsidy that was used to pay each of their employees’ salaries by using a special code in the “Other information” area at the bottom of the employees’ T4 slips. More information on the T4 reporting requirements will be released before the end of the year.

It is expected that CRA will publish a list of employers that have applied for the CEWS.

Disclaimer

This document is last updated on June 19, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

For additional information, please refer to

https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html

https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy/cews-contact.html

https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy/cews-frequently-asked-questions.html

https://www.canada.ca/en/department-finance/news/2020/04/government-introduces-covid-19-emergency-response-act-no-2-to-help-businesses-keep-canadians-in-their-jobs.html

https://www.canada.ca/en/department-finance/news/2020/04/additional-details-on-the-canada-emergency-wage-subsidy0.html

https://www.canada.ca/en/department-finance/news/2020/04/government-introduces-covid-19-emergency-response-act-no-2-to-help-businesses-keep-canadians-in-their-jobs.html

https://www.parl.ca/DocumentViewer/en/43-1/bill/C-14/royal-assent

https://www.canada.ca/en/department-finance/economic-response-plan/wage-subsidy.html

https://www.canada.ca/en/department-finance/news/2020/04/the-canada-emergency-wage-subsidy.html

https://www.canada.ca/en/department-finance/news/2020/04/government-announces-details-of-the-canada-emergency-wage-subsidy-to-help-businesses-keep-canadians-in-their-jobs.html

The Canada Emergency Business Account (CEBA) program provides interest-free loans of up to $40,000 to small businesses and not-for-profits. Repaying the balance of the loan on or before December 31, 2022 will result in loan forgiveness of 25 percent (up to $10,000).

Eligibility

The borrow must be:

  • Canadian operating business in operation as of March 1, 2020.
  • Has a federal tax registration.
  • Had total employment income paid in the 2019 calendar year was between $20,000 and $1,500,000.

For applicants with $20,000 or less in total employment income paid in the 2019 calendar year, the applicants must have a Canada Revenue Agency business number and has filed a 2018 or 2019 tax return.

  • Has eligible non-deferrable expenses between $40,000 and $1,500,000.

Eligible non-deferrable expenses could include costs such as rent, property taxes, utilities, and insurance. Expenses will be subject to verification and audit by the Government of Canada.

  • Has an active business chequing /operating account with the Lender, which is its primary financial institution. This account was opened on or prior to March 1, 2020 and was not in arrears on existing borrowing facilities, if applicable, with the Lender by 90 days or more as at March 1, 2020. Businesses operated through a personal bank account are not eligible.
  • Has not previously used the Program and will not apply for support under the Program at any other financial institution.
  • Acknowledges its intention to continue to operate its business or to resume operations.
  • Agrees to participate in post-funding surveys conducted by the Government of Canada or any of its agents.

The funds from this loan shall only be used to pay non-deferrable operating expenses including payroll, rent, utilities, insurance, property tax and regularly scheduled debt service, and may not be used to fund any payments or expenses such as prepayment/refinancing of existing indebtedness, payments of dividends, distributions and increases in management compensation.

Application

Application should be made with the primary financial institution.

For applicants under the Non-Deferrable Expenses Stream, additional supporting is required to demonstrate 2020 eligible non-deferrable expenses between $40,000 and $1,500,000.

Disclaimer

This document is last updated on June 19, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

For additional information, please refer to

https://ceba-cuec.ca/

Eligibility

To qualify for CECRA, the commercial property owner must:

  • own or be the landlord of the commercial real property which is occupied by one or more impacted small business tenants
  • enter (or have already entered) into a rent reduction agreement for the period of April, May and June 2020, reducing an impacted small business tenant’s rent by at least 75%
  • ensure the rent reduction agreement with impacted tenants includes a moratorium on eviction for the period of April, May and June 2020
  • have declared rental income on tax return (personal or corporate) for tax years 2018 and/or 2019

Impacted small business tenants are businesses, including non-profit / charitable organizations or in sub-tenancy arrangements, that:

  • pay no more than $50,000 in monthly gross rent per location (as defined by a valid and enforceable lease agreement)
  • generate no more than $20 million in gross annual revenues in a 12-month period, calculated on a consolidated basis
  • have experienced at least a 70% decline in pre-COVID-19 revenues

Small businesses can compare revenues in April, May and June of 2020 to that of the same period in 2019 to measure revenue losses. They can also use an average of their revenues earned in January and February of 2020.

Small businesses that opened on or after March 1, 2020 are not eligible.

Landlords and tenants who are not at arm’s length will be eligible for CECRA so long as there was a valid and enforceable lease agreement in place prior to April 1, on no greater than market terms.

Amount

The program will provide forgivable loans to eligible commercial property owners to cover 50% of the monthly gross rent owed by impacted small business tenants during the 3-month period of April, May and June 2020.  The loan will be forgiven if the property owner complies with all applicable program terms and conditions — including to not recover forgiven rent amounts when the program is over. If conditions are met, the loan will be forgiven on December 31, 2020.

The property owner will be responsible for no less than half of the remaining 50% of the monthly gross rent payments (paying no less than 25% of the total).

The small business tenant will be responsible for no more than half of the remaining 50% of the monthly gross rent payments (paying no more than 25% of the total).

The deadline to apply is August 31, 2020.

Application

Application can be made through Canada Mortgage and Housing Corporation (CMHC):

https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business

The online application process will include both fillable fields and templates of the documents required. Property owners will need to provide information to prove eligibility including:

  • proof of an existing rent reduction agreement
  • moratorium on eviction, and
  • small business tenant financial hardship (i.e. attestation of 70% decline in revenue)

Application must be made with respect to all 3 months and all impacted tenants in a single application for each location. Applicants can only apply for the program once per property. Multiple applications are allowed provided that each application is for a different property.

In any case, an application must be filed on or before August 31, 2020.

Disclaimer

This document is last updated on June 19, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

For additional information, please refer to

https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business

Eligibility

The CERB is available to individual who is:

  1. residing in Canada, who are at least 15 years old;

To be eligible for the Canada Emergency Response Benefit, you must reside in Canada and have a valid Social Insurance Number.

Workers who are not Canadian citizens or permanent residents – including temporary foreign workers and international students – may be eligible to receive the Benefit if they meet the other eligibility requirements.

  1. who have stopped or reduced working because of COVID-19 or are eligible for Employment Insurance regular or sickness benefits;
  2. who had income of at least $5,000 in 2019 or in the 12 months prior to the date of their application; and

The income of at least $5,000 may be from any or a combination of the following sources: employment; self-employment; maternity and parental benefits under the Employment Insurance program and/or similar benefits paid in Quebec under the Quebec Parental Insurance Plan.

The income does not have to be earned in Canada.

Update on April 6, 2020 –

Non-eligible dividend (generally, those paid out of corporate income taxed at the small business rate) can be counted towards the $5,000 income requirement to be eligible for CERB.

  1. who are or expect to have less than $1,000 of income from employment, self-employment, or ineligible dividend for at least 14 consecutive days in the initial four-week period. For subsequent benefit periods, they expect to have less than $1,000 of income from employment, self-employment, or ineligible dividend for the entire 4-week period.

Amount

$500 a week for up to 24 weeks.

The benefit will be issued for a 4-week period, beginning March 15, 2020 (i.e. one single payment in the amount of $2,000) to October 3, 2020.

If your situation continues, you can re-apply for a payment for multiple 4-week periods, to a maximum of 24 weeks (6 periods).

Retroactive application must be made no later than December 2, 2020.

How to apply and timing

Application for the Benefit will be available in April 2020, and require Canadians to attest that they meet the eligibility requirements. They will need to re-attest every two weeks to reconfirm their eligibility. Canadians will select one of three channels to apply for the Benefit:

  1. by accessing it on their CRA My Account secure portal; https://www.canada.ca/en/services/benefits/ei/cerb-application.html
  2. by calling a toll free number (1-800-959-2019) equipped with an automated application process.

If you are getting your payment by direct deposit, expect your payment within 3 business days from the day you submitted your application

If you are getting your payment by cheque, expect to get the cheque within 10 business days from the day you submitted your application.

Return or repay CERB

The CERB can be repaid under one of the following methods:

  1. Return the CERB cheque by mail to

Revenue Processing – Repayment of CERB
Sudbury Tax Centre
1050 Notre Dame Avenue
Sudbury ON P3A 0C3

  1. Mail a cheque, made payable to “Receiver General for Canada”, to the above address. Please include your Social Insurance Number (Sin), and indicate it is for “Repayment of CERB”.

Other

The benefit is reportable as income in the year in which the benefit is received.

If you became eligible for EI regular or sickness benefits on March 15, 2020, or later, your claim will be automatically processed through the Canada Emergency Response Benefit.

Disclaimer

This document is last updated on June 19, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

For additional information, please refer to

https://www.canada.ca/en/department-finance/news/2020/03/introduces-canada-emergency-response-benefit-to-help-workers-and-businesses.html

https://www.canada.ca/en/revenue-agency/services/benefits/apply-for-cerb-with-cra.html

https://www.canada.ca/en/services/benefits/ei/cerb-application.html

https://www.canada.ca/en/services/benefits/ei/cerb-application/questions.html

On March 18, 2020, the Prime Minister announced a number of measures to help stabilize the economy, one of which is the temporary wage subsidy.

“The 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. “

On March 20, 2020, the Canada Revenue Agency (CRA) released further detail.

 

Eligibility

Employers are eligible for the temporary wage subsidy if it:

  • is a
    • non-profit organization
    • registered charity
    • a Canadian-controlled private corporation (CCPC)
    • an individual (excluding trusts)
    • or a partnership whose all partners are individuals (excluding trusts), registered charities, or Canadian-controlled private corporations (CCPCs) eligible for the small business deduction.
  • has an existing business number and payroll program account with the CRA on March 18, 2020; and
  • pays salary, wages, bonuses, or other remuneration to an employee.

Note: CCPCs are only eligible for the subsidy if their taxable capital employed in Canada for the preceding taxation year, calculated on an associated group basis, is less than $15 million.

 

Amount

The subsidy is calculated as 10% of the remuneration pay between March 18, 2020, and June 20, 2020, up to $1,375 per employee and to a maximum of $25,000 total per employer.

Associated CCPCs will not be required to share the maximum subsidy of $25,000 per employer.

For example, if you have 5 employees, the maximum subsidy you can receive is $6,875 ($1,375 x 5 employees), even though the per employer maximum is $25,000.

 

How to apply

Once the subsidy is calculated, the current remittance of federal, provincial, or territorial income tax can be reduced by the amount of the subsidy. The subsidy will NOT reduce the remittance of Canada Pension Plan (CPP) contributions or Employment Insurance (EI) premiums.

For a regular remitter, the remittance due to the CRA can be reduced starting from April 15, 2020.

If you calculated a subsidy of $2,050 on remuneration paid between March 18, 2020, and June 20, 2020, but only deducted $1,050 of federal, provincial, or territorial income tax from your employees, you can reduce a future income tax remittance by $1,000, even if that remittance is in respect to remuneration paid after June 20, 2020.

 

Other

The subsidy will not affect deductions from employees. The subsidy is only calculated when remittance is made to the CRA.

The subsidy can be applied and reduced payroll remittances during the year, paid out at the end of the year, or transferred to the next year’s remittance.

The subsidy is reportable as income in the year in which the subsidy is received.

The CRA is currently updating reporting requirements. More information on how to report this subsidy will be released in the near future.

 

Disclaimer

This document is last updated on April 23, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

For further assistance in the calculation of the subsidy amount, please refer to this free calculator:

https://www.taxtemplates.ca/wage-subsidy-download

For more information on the CRA guideline, please refer to

https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html

https://www.parl.ca/DocumentViewer/en/43-1/bill/C-13/royal-assent

The Canada Emergency Student Benefit (CESB) received Royal Assent on May 1, 2020

Eligibility

Eligible student includes:

  • Canadian citizen
  • Permanent resident as defined in the Immigration and Refugee Protection Act
  • Protected person as defined in the Immigration and Refugee Protection Act
  • Person registered as an Indian under the Indian Act

And:

  • is enrolled, at any time between December 1, 2019 and August 31, 2020, in a post-secondary educational program that leads to a degree, diploma or certificate, or
  • completed or ended post-secondary studies in December 2019 or later, or
  • has graduated from secondary school in 2020 at the time of application of benefit, has applied for enrollment in a post-secondary educational program that is scheduled to begin before February 1, 2021.

A student is eligible for a Canada emergency student benefit if, during the 4-week claim period,

  • Due to COVID-19, the student is,
  • unable to work
  • seeking work and unable to find it
  • is working but is paid less than $1,000 before tax, AND
  • Does not receive:
  • income from employment or self-employment of more than $1,000 before tax
  • EI benefits
  • Allowances or benefits under a provincial plan because of pregnancy, or in respect of a new-born child or child under adoption
  • Support payment under the Canada Emergency Response Benefit (CERB) program

Amount

$1,250 per month for eligible students.

$2,000 per month for eligible students with at least one dependent under age 12.

$2,000 per month for eligible students with disabilities.

This benefit would be available from May 10 to August 29, 2020, divided into 4 claim periods:

  • May 10 to June 6, 2020
  • June 7 to July 4, 2020
  • July 5 to August 1, 2020
  • August 2 to August 29, 2020

The benefit is in general not subjected to garnishment, deduction, claim as security or against bankruptcy / insolvency.

Any overpayment of benefits must be repaid as soon as feasible. Interest will not be charged on the balance owing.

Application

Application can be made through the CRA under this link starting May 15, 2020.

https://www.canada.ca/en/revenue-agency/services/benefits/emergency-student-benefit.html

In any case, an application must be filed on or before September 30, 2020.

Other

The benefit is reportable as income in the year in which the benefit is received.

Disclaimer

This document is last updated on June 19, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

For additional information, please refer to

https://www.canada.ca/en/revenue-agency/services/benefits/emergency-student-benefit.html

https://www.parl.ca/DocumentViewer/en/43-1/bill/C-15/royal-assent

Temporary salary top-up for low-income essential workers

The government is introducing a temporary top-up to the salaries of low-income workers (those who earn less than $2,500 per month on a full-time basis), that the provinces and territories have deemed essential in the fight against COVID-19.

More details will be released shortly.

 

Canada Student Service Grant (CSSG)

The Canada Student Service Grant (CSSG), which will help students gain valuable work experience and skills while they help their communities during the COVID‑19 pandemic. For students who choose to do national service and serve their communities, the new CSSG will provide up to $5,000 for their education in the fall.

More details will be released shortly.

 

Temporary changes to Canada Summer Jobs program

The Canada Summer Jobs program is being changed to allow employers to:

  • receive an increased wage subsidy, so that private and public sector employers can also receive up to 100 per cent of the provincial or territorial minimum hourly wage for each employee;
  • extend the end date for employment to February 28, 2021;
  • adapt their projects and job activities;
  • hire staff on a part-time basis.

 

Disclaimer

This document is last updated on April 23, 2020, and will be updated as new measures are announced.

We at MDP will continue to monitor the status of the legislation and advise accordingly. This document should be used for general information purposes only. If you would like to discuss the above in regards to your specific situation, please contact us.

 

For further information:

https://innovation.ised-isde.canada.ca/s/?language=en