With government announcements coming daily it can be hard to keep up. Here is a quick summary of what we know so far and what is still being clarified.
An increase in wage subsidies to 75% (up from the previously announced 10% subsidy plan), backdated to March 15, so that employers can keep workers on the payroll;
- Expanded to all Canadian companies and charities that have seen at least a 30% drop in business
- Doesn’t matter how many employees you employ. It is a revenue test (i.e. 30% drop in business)
- Workers who qualify for the Canada Emergency Wage Subsidy will have 75 per cent of their salary covered, up $58,700 annually. That equals up to $847 per week. The program will be backdated to March 15th
- Trudeau urged companies that could top up employee salaries the additional 25 per cent to do so
- The prime minister said there would be “serious consequences” for any companies that try to game the system. A verification system will be set up before the program is rolled out
What is still Unknown
- Cash injection of the 75% by the CRA or reduction of source. How quickly can the cash come in?
- How to apply
- What period is the 30% drop in revenue apply to (i.e. since January 1st, or since March 15th)?
- What about those with no employees and sales dropped and only one or a few shareholders?
Loan guarantees (details to follow who qualifies – $40,000 in loans, with up to $10,000 forgiven). As of now:
- To qualify, these organizations will need to demonstrate they paid between $50,000 to $1 million in total payroll in 2019. Repaying the balance of the loan on or before December 31, 2022 will result in loan forgiveness of 25 percent (up to $10,000).
- This program is being offered through online application only
- Bank still working out how to implement
Canada Emergency Response Benefit (CERB)
Canada Emergency Response Benefit (remember to setup your MY ACCOUNT) – $2,000-a-month
$2,000 to coronavirus-affected workers who have been laid off, or cannot work, due to the crisis. That application portal is scheduled to be available on April 6.
Provides a taxable benefit of $2,000 a month for up to 4 months to:
- Workers who must stop working due to COVID19 and do not have access to paid leave or other income support.
- workers who are sick, quarantined, or taking care of someone who is sick with COVID-19.
- working parents who must stay home without pay to care for children that are sick or need additional care because of school and daycare closures.
- workers who still have their employment but are not being paid because there is currently not sufficient work and their employer has asked them not to come to work.
- wage earners and self-employed individuals, including contract workers, who would not otherwise be eligible for Employment Insurance.
What is still Unknown
- Definition of self employed
- Who qualifies is still unclear. How about shareholders of corporation that have no revenue, no employees, can the shareholders get the $2,000?
Information is changing daily with regards to these and other programs. We will continue to update things on what we know as new information becomes available.
As always, I welcome your comments, calls and questions.
Steve Garganis 416 224 0114 email@example.com
As an industry insider, Steve will share info that the BANKS don't want you to know. Steve has appeared on TV's Global Morning News, CBC's "Our Toronto" and The Real Life TV show. He's also been quoted in several newspapers such as the Globe and Mail, The Toronto Star, The Vancouver Sun, The Star Phoenix, etc.