Since our last update to you, our unpredictable Maritime weather has quickly turned to late Fall and we have seen a re-emergence of COVID 19 in Atlantic Canada after several weeks of few cases. While we are fortunate that infection rates have been low compared to other areas, we must remember to do our individual part to keep each other safe and healthy. With an approved vaccine on the horizon, there is reason to be hopeful as we approach the Holiday season.
As you may be aware, the Federal government provided a fall economic update on November 30th that confirmed the government will continue to support Canadian individuals and businesses through the pandemic.
The eligibility criteria for each of the programs continue to evolve and are becoming more complex. As such, we strongly urge you to contact us before you apply for any of the programs. We can assist in determining which programs are available to you and the application process.
A summary of the most significant changes are below:
Support for Businesses
Canada Emergency Wage Subsidy (“CEWS”)
In the fall economic update, the Federal government extended the CEWS program to March 13, 2021 with a further extension possible to June 30, 2021. The program was made available to employers that suffered a decline in revenue. The maximum subsidy rate was increased to 75% for employers that suffered a 70% revenue reduction. The revenue decline is calculated by comparing the same month in the prior year or the average revenue of January and February, 2020. The method used to calculate the reduction must be used consistently
Canada Emergency Rent Subsidy (“CERS”)
In an effort to address concerns raised by landlords and tenants about the Canada Emergency Commercial Rent Assistance program (“CECRA”), the government introduced the CERS program. Commercial tenants can access the program directly (without landlord participation). The eligibility criteria is the same as the CEWS program. Tenants with revenue reductions compared to the same month in the prior year or average revenue of January and February, 2020 can access this program. Under CERS, the subsidy amount is based on the percentage of revenue decrease with a maximum subsidy of 65% with a related 70% revenue reduction.
Eligible rent must be paid to an arm’s length landlord. The maximum rent under CERS is $75,000 per location for each qualifying period with an overall maximum of $300,000 of expenses. In the fall economic update, the Federal government extended the CERS program to March 13, 2021 with a further extension possible to June 30, 2021.
Applications must be made within 180 days of the qualifying period being applied for.
Canada Emergency Business Account
The Federal government expanded the CEBA program to provide an additional interest free loan of $20,000 with up to 50% of the loan being forgivable if the loan is repaid by December 31, 2022. Businesses must attest to the need for the loan. It is important to note that both the eligibility criteria and attestation requirements for the original $40,000 loan and the expanded $20,000 loan have changed. Given these changes, we recommend you contact us to discuss the loan terms in more detail before applying. The application deadline is March 31, 2021 to apply for the $60,000 CEBA loan or the $20,000 expansion.
Support for Businesses Under Lockdown
The Federal and provincial governments introduced lockdown rental support for businesses that are forced to close because of a public health order. Please contact us if you require more details on the Federal program which are complex. The Provincial government provides a $5,000 impact grant for restaurants, bars and fitness businesses in parts of HRM and Hants county that have been ordered to reduce operations or close under the public health directive in effect beginning November 26, 2020. The $5,000 grant is to cover operating expenses.
Support for Individuals
Home Office Expenses
COVID 19 has resulted in many Canadians being required to work from home by their employers and in many cases, individuals incurred expenses to do so. To address this, the government has indicated that employees will be able to deduct up to $400 of expenses in a simplified manner. CRA will be providing more detail on this support in the coming weeks.
Student Loan Interest
The government proposes to eliminate interest on the federal portion of Canada Student loan repayments and Canada Apprentice loans for 2021 and 2022.
Our Office, Our Team and a Happy Holiday
We continue to follow provincial health protocols relating to COVID 19 in order to ensure the health and safety of our team. We continue to have in person meetings as needed however we do offer clients the option of virtual meetings as well.
For 2021, we are continuing our efforts to become a “paperless” office. To achieve this, we are implementing new software that will allow us to securely send financial statements and tax return packages to our clients with the ability to sign and return all correspondence electronically and eliminate the need for hard copy packages which have been customary.
As has become our tradition, we have made donations to Feed NS and the Salvation Army totaling $2,000 as our own way to recognize our valued clients. At this time of year and especially for 2020, our community needs our support more than ever and we felt this was the best way to honour our clients.