COVID-19 Federal Benefits and Supports
By Nizam Shajani, CPA, CA, MBA
Our firm is here to help our clients gain access to COVID-19 benefits. We understand these are unprecedented times and many of you are facing uncertainty and difficulties in your businesses. We will aim to communicate and assist in benefits that are available. And we are wishing all of you health and safety.
Prime Minister Justin Trudeau announced an $82-billion dollar aid package today to help Canadians cope with the COVID-19 pandemic. The following is a summary of what will be made available.
Tax Payment Deferrals
The April 30th tax payment deadline will be extended to August 31st this year. Reports indicate tax payments due after today and before September may be paid on August 31st. The deferral of payments is anticipated to leave $55-billions in the economy.
This deferral applies to tax balances due well as installments during this period.
Tax Filing Deadlines
The department of finance has released the tax filing deadline for individuals 2019 personal taxes will be extended to June 1, 2020. However if you expect to receive benefits under the Canada Child Benefit, GST or expect a tax refund, it may be a good idea to file earlier.
Trust returns with a December 31, 2019 taxation year have an extension to file up to My 1, 2020.
The Department of Finance has noted to reduce the necessity for taxpayers and tax pre-parers to meet in person, and to reduce administrative burdens, effective immediately Canada Revenue Agency will recognize electronic signatures as having met the signature requirements of the Income Tax Act as a temporary administrative measure.
CRA will not initiate any audits over the next four weeks.
Employers of small businesses will have access to a temporary wage subsidy of 10% of salaries paid to employees for a period of three months – to a maximum of $25,000 per business. This is to encourage employers to keep staff on payroll during these uncertain times.
Export Development Canada will provide support to Canadian companies affected by COVID-19.
Farm Credit Canada will be boosted.
The Canada Account will be used to support businesses in industries directly affected by COVID-19.
Details of these supports will come in the next few days.
Business Credit Availability Program
The Business Credit Availability Program will allow Business Development Bank of Canada and Export Development Canada to provide more than $10 Billion of additional support, largely targeted to small and medium sized businesses. This is an effort to help viable Canadian businesses remain resilient during these uncertain times.
Emergency Care Benefit
A new emergency care benefit of up to $450 per week for 14 weeks (paid bi-weekly) will be provided as income support to workers, including self-employed workers, who have to stay at home and don’t qualify for paid sick leave or employment insurance. This applies to people who fall ill, are placed in quarantine, must self-isolate or take care of a family member who is ill. This may only require an attestation of the fact and not a medial note.
Emergency Support Benefit
A new emergency support benefit will be made available for workers who are not eligible for EI and are face unemployment. This includes those who are self-employed and must close shop due to the virus.
The Government, through Canada Mortgage and Housing Corporation is providing increased flexibility for homeowners facing financial difficulties to defer mortgage payments. CMHC will allow lenders to allow payment deferral starting immediately.
Canada Child Benefit
Parents should receive an additional $300 for each child.
In May, the GST credit will be supplemented by up to $300 based on $150 per child. This will be for low income Canadians and need to qualify.
Canada Student Loans will be made interest free for a period of six months.