COVID-19 Updates

PTMG continues to monitor the COVID-19 situation and its implications to our staff and clients. We will continue to update this page as new information becomes available.

OFFICE POLICY

We are keeping our office open to both staff and clients. We are operating under normal business hours, taking phone calls and responding to email. We are trying to reduce the number of visitors to our office, by encouraging clients to:

Provide information electronically - speak with your accountant for options; and
Mail information to our office.

However, we are currently accepting in-person meetings.

You may still drop off information at our office in person; however, we have implemented new policies in our office for both staff and visitors. Do not enter PTMG's office if:

You have travelled outside of the country in the past 14-days, or
You are displaying symptoms consistent with COVID-19 (cough, fever, difficulty breathing, pneumonia in lungs).

GOVERNMENT MEASURES

Businesses

December 4 - Canada Emergency Business Account (CEBA)

The Canada Emergency Business Account (CEBA) provides interest-free loans up to $60,000 to small businesses and not-for-profits to help pay for non-deferrable operating expenses. The original CEBA provided $40,000 with $10,000 forgivable if $30,000 was repaid by December 31, 2022.

The expanded CEBA provides a total of $60,000 (the original $40,000 plus an additional $20,000) of interest-free loan with $20,000 forgivable (the original $10,000 plus an additional $10,000) if $40,000 is repaid by December 31, 2022. If you have already applied for the original $40,000 CEBA, you may apply on your banking website for the additional $20,000. You are not required to upload any additional supporting documentation; however, you are required to attest that you meet certain conditions (see the conditions at the bottom of this message).

The program was also expanded to include businesses which did not have an active business chequing/operating account on March 1, 2020. Businesses that were excluded due to this condition may now apply for CEBA after opening a business/operating account with their primary bank.

If you have not previously applied for CEBA but wish to apply now, you may only apply for the expanded $60,000 CEBA. You will need to apply under one of two streams:

Payroll stream: For businesses with a 2019 payroll between $20,000 and $1.5 million, or
Non-deferrable expenses stream: For businesses with less than $20,000 in 2019 payroll. These businesses must provide supporting documentation that they have eligible non-deferrable expenses between $40,000 and $1.5 million.

Applications are made through your primary banking website. The deadline to apply has been extended to March 31, 2021.

When applying for the expanded CEBA, the borrower must attest to the following:

that its business is facing ongoing financial hardship (including, for example, a continued decline in revenue or cash reserves, or an increase in operating costs) as a result of the COVID-19 pandemic;
that it intends to continue to operate its business or to resume operations;
that in response to the COVID-19 pandemic it has made all reasonable efforts to reduce its costs and to otherwise adapt its business to improve its viability; and
that it has not used any loan received under the Program to make any payment or pay any expense other than Eligible Non-Deferrable Expenses. Specifically, the Borrower has not used any loan received under the Program to make any prepayment/refinancing of existing indebtedness, any payment of dividends, distributions or increases in management compensation or to increase the compensation of related parties.

October 9 - Canada Emergency Wage Subsidy (CEWS), Canada Emergency Rent Subsidy (CERS) and Canada Emergency Business Account (CEBA) Update

CEWS will be extended through June 2021. The subsidy will remain at the October subsidy rate through Period 10 (ends December 19).
CERS will provide rent and mortgage support until June 2021 for qualifying organizations affected by COVID-19. The subsidy will be provided directly to tenants that have suffered a revenue drop, but subsidizing a percentage of their expenses on a sliding scale, up to to 65% of eligible expenses until December 19, 2020 (claims may be made retroactively for the period that began on September 27). A top-up of 25% is available for organizations temporarily shut down by a mandatory pubic health order.
CEBA has been expanded for businesses that continue to be seriously impacted by COVID-19 - it provides access to an additional interest-free loan of up to $20,000, half of which is forgivable if repaid by December 31, 2022. The CEBA application deadline has been extended to December 31, 2020.

August 10 - Canada Emergency Commercial Rent Program (CECRA)

The CECRA program has been extended to cover rent in July and August.
The deadline for new applications which include the July or August extension is August 31, 2020. For those who already submitted a previous application, the deadline for the July or August extension is September 14, 2020.

July 27 - Canada Emergency Wage Subsidy (CEWS) Update

The CEWS program was amended and approved by the Senate on July 27, 2020.
A summary of the key changes are as follows:
- Extended the wage subsidy to November 21, 2020.
- Revenue declines of less than 30% now qualify, retroactive to July 2020 revenues compared to the prior reference period.
- A sliding scale has been introduced which provides wage subsidy support based on the extend of the revenue decline. The base subsidy percent declines in each of periods 7 through 9 (September through November).
- A top-up subsidy allows for additional support for those most affected, to a maximum of $960 per week per employee (based on a rolling three month average drop in revenues in excess of 50%).
- Introduction of new "baseline remuneration" periods that can be selected on an employee-by-employee basis.
- A "safe harbour" provision allows for employers to use the original wage subsidy calculation for P5 & P6 (July and August) if it results in a higher subsidy than the amendments to the program.

July 13 - Canada Emergency Wage Subsidy (CEWS) Update

Those organizations that do not qualify for the Canada Emergency Wage Subsidy may continue to qualify for the previously announced wage subsidy of 10 per cent of remuneration paid from March 18 to before June 20, up to a maximum subsidy of $1,375 per employee and $25,000 per employer - refer to our March 18 update below for details.
Conditions applicable to those applying for the 75% wage subsidy include
- Businesses, not-for-profits and charities, no matter what the size, are eligible for this subsidy.
- Not available to organizations that are publicly funded.
- There is no employer limit to how much subsidy an organization can claim. There is an employee limit of $847 per week.
- Employer must attest that they are doing everything they can to pay the remaining 25%. If an organization is unable to pay the remaining 25% of wages, the wage subsidy is still available.
Employers may compare the revenue of an eligible wage period to either a) the same month of 2019, or b) to an average of their revenue in January and February 2020. The approach selected must be used consistently each period.
- The revenue recognition policy can be accrual or cash basis, but must use the same policy for all eligible periods.
- Revenue excludes non-arm's length sources and excludes extraordinary items and amounts on account of capital.
- Eligible periods for CEWS include March to August 2020 (proposed extension to December 2020).
- Employers are eligible for wage subsidy if there is a 15% decline in revenue in March 2020 or a 30% decline in revenue in any other month. If you experience a revenue decline as defined above, you automatically qualify for wage subsidy in both the month with the decline and the subsequent month.
The wage subsidy is calculated as the greater of
- 75% of remuneration paid, up to a maximum of $847 per week; and
- The full remuneration paid, up to a maximum of $847 per week or 75% of the employee's pre-crisis weekly remuneration (from January 1 to March 15 2020), whichever is less.
For employees that are related or non-arms length with the employer the subsidy is further limited to 75% of the pre-crisis weekly remuneration (i.e., if they weren't paid from January 1 to March 15, 2020, then no subsidy is available).
100% refund for certain EI and CPP employer contributions of furloughed employees (paid without work) in the period where the employer is receiving CEWS.
There are significant penalties of up to 225% repayment and 5 years in prison for those who take advantage of this program.

Application for the subsidy will be administered by the CRA through My Business Account as well as a web-based application. More details about the application process will be made available shortly.

May 26 - Youth Employment and Skills Program (YESP)

Additional funding to help the agriculture industry attract Canadian youth, ages 15 to 30) to their organizations to assist with labour shortages brought on by the pandemic.
The YESP program will provide agriculture employers up to 50% of the cost of hiring a Canadian youth, up to $14,000. Indigenous applicants and those applicants hiring youth facing barriers are eligible for funding of up to 80% of their costs.
Eligible applicants include producers, agri-businesses, industry associations, provincial and territorial governments, indigenous organizations and research facilities.
Employers may apply for this funding retroactive to April 1, 2020 with projects to be completed by March 31, 2021.

May 20 - Canada Emergency Commercial Rent Assistance (CECRA) Program Update

Applications for this program will begin on May 25.
Eligibility for this program requires that landlords reduce the rental costs of small business tenants for April to June by at least 75%.
The Federal and Ontario governments will provide a forgivable loan to cover 50% of the total 75% reduction in rent paid by the tenant(s). The remaining 25% of the rent reduction would be rent waived by the landlord.
A signed rent forgiveness agreement that also includes a moratorium on evictions for three months must be in place between impacted tenants and landlords.
This program will be administered by the Canada Mortgage and Housing Corporation (CMHC) and is available for applications until September 30, 2020.
This program applies to commercial properties with small business tenants. Commercial properties with a residential component, and residential mixed-use properties with a 30% commercial component, would also be eligible for support with respect to their commercial tenants.
An eligible small business tenant is one that:
- Pays monthly rent not exceeding $50,000 in gross rent payments,
- Generates no more than $20 million in gross annual revenues, and
- Is experiencing a decline of at least 70% in pre-COVID-19 revenues (determined by comparing revenues in April, May and June to the same month in 2019 or alternatively compared to average revenues for January and February 2020).

May 19 - Canada Emergency Business Account (CEBA) Update

The CEBA eligibility has been expanded to include many owner-operated small businesses. CEBA allows banks and credit unions to provide their business clients' interest free loans of up to $40,000 for non-deferrable operating expenses. The loans will be guaranteed by the Government of Canada and 25% of the loan amount will be forgivable (up to $10,000) if 75% is repaid after January 1, 2021 and before December 31, 2022. Eligibility includes
- Small businesses who have a 2019 payroll between $20,000 and $1.5 million
- Applicants that have payroll of less than $20,000, including sole proprietors receiving income directly from their businesses, businesses that relies on contractors or family-owned corporations that pay employees through dividends rather than payroll, and have:
  - A CRA business number and to have filed a 2018 or 2019 tax return, and
  - Eligible non-deferrable expenses between $40,000 and $1.5 million. Eligible non-deferrable expenses could include costs such as scheduled loan repayments, rent, property taxes, utilities and insurance.

April 17 - Community Futures Network Supporting Rural Businesses

Community Futures Network is supporting rural businesses and communities.
Funding will be allocated towards smaller employers and businesses located in rural parts of the country who do not qualify for the recently announced Canada Emergency Wage Subsidy or loan programs (e.g., Canadian Emergency Business Account).

April 8 - Canada Summer Jobs Program

The Federal government announced temporary changes to the program:
- An increase to the wage subsidy, so that private and public sector employers can also receive up to 100% of the provincial minimum hourly wage for each employee.
- An extension to the end date for employment is now February 28, 2021.
- Employers may adapt their projects and job activities to support essential services.
- Employers may hire staff on a part-time basis.

March 25, 2020 - Ontario's Action Plan: Responding to COVID-19

Employer Health Tax (EHT) exemption has been increased from $490,000 to $1,000,000 for 2020.
Workplace Safety and Insurance Board (WSIB) will allow employers to defer payments for a six-month period.
Proposed Regional Opportunities Investment Tax Credit, which will provide a 10% refundable corporate income tax credit for Canadian-controlled private corporations that make qualifying capital investments (e.g. commercial and industrial buildings) between $50,000 and $500,000 in eligible regions (includes Huron, Perth, Middlesex, Bruce, Grey, Lambton and others).

March 23 - Ontario government orders closure of all non-essential workplaces

The Ontario government announced the mandatory closure of all non-essential workplaces, effective Tuesday, March 24 at 11:59pm for at least 14-days. Businesses defined as essential can remain open.

March 21 - Charity deadlines extended

The deadline was extended for charities with a T3010 or Registered Charity Information Return due between March 20 and December 31, to December 31.

March 18 - Federal government announces Canada's COVID-19 Economic Response Plan

The Federal government announced several new measures in their COVID-19 Economic Response Plan. For a full list of the measures applicable to businesses, please refer the government's announcement.
Key highlights (not the full list) include
- Corporate tax balances and instalments owing after March 17 may be deferred without penalty or interest until after August 31, 2020.
- A temporary business wage subsidy will be available to the following businesses who are trying not to lay off their employees: a) Canadian-controlled private corporations with taxable capital employed in Canada for the preceding taxation year of less than $15 million b) non-profit organizations, c) registered charities, d) an individual (other than a trust) and e) a partnership comprised of members who are described in (a), (d) or (c). Qualifying employers will be eligible to a wage subsidy of 10% of wages paid between March 18 and June 20, 2020 up to $1,375 per employee and $25,000 total. For more information, visit the government's Frequently Asked Questions [https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html] page or speak with your accountant.

Individuals

May 13 - Canada Emergency Student Benefit

The CESB is a benefit for post-secondary students who are not eligible for the CERB and are looking for, but unable to, work or unable to earn more than $1,000 pre-tax income over the four week period for which they are applying.
The benefit is available from May to August, providing $1,250 per month to eligible students. An additional $750 per month is available to eligible students with disabilities or dependents.

April 15 - Canada Emergency Response Benefit (CERB)

Taxable benefit up to $2,000 per month for up to four months for workers who lose their income as a result of the COVID-19 pandemic.
You must meet the following conditions to apply for this benefit:
- You stopped working due to COVID-19, whether due to illness, lost employment or reasons beyond your control (e.g., you can't voluntarily quit). Includes job loss, sickness, quarantine, caring for someone who is sick or kids off school.
- Earned at least $5,000 in 2019 or the last 12 months through employment, self-employment and maternity/paternity EI. This includes a) seasonable workers who have exhausted their EI regular benefits and are unable to undertake their regular seasonal work as a result of the COVID-19 outbreak and b) workers who have recently exhausted their EI regular benefits and are unable to find a job or return to work due to COVID-19.
- Have or expect to have at least 14 consecutive days without income in the initial 4 week period of application. This rule has been updated to allow for income of up to $1,000 per month while collecting the CERB.
- Reside in Canada and be at least 15-years old at the time of application.
- Not be currently receiving or have applied for EI regular or sickness benefits.
The portal for accessing the CERB will be available in early April on CRA's My Account.

April 6 - Ontario Support for Families

The Ontario Government has opened applications for eligible parents to receive a one-time payment of $200 per child aged 0 to 12 or $250 per child with special needs aged 0 to 21. If families previously registered for the Support for Parents during strike days, they do not need to register again.
Note - the strike days support was not available to non-school aged children; however, this program is. Therefore, you may need to register non-school aged children separately for this program.

March 25, 2020 - Ontario's Action Plan: Responding to COVID-19

Guaranteed Annual Income System (GAINS) will double for low-income seniors to $166 per month for individuals and $332 per month for couples, for six months starting April 2020.
One-time $200 payment per child up to 12 years of age ($250 for those with special needs).
Ontario Student Assistance Program (OSAP) loan and interest accrual relief for six months.
Electricity will be more affordable for 45 days for residential, farm and small business consumers, including setting prices for time-of-use customers at the lowest rate.
Low-income energy assistance program (LEAP) eligibility has been enhanced.

March 18 - Federal government announces Canada's COVID-19 Economic Response Plan

Deadline to file your personal income tax return is extended to June 1, 2020 (self-employed individuals continue to have until June 15, 2020).
- If you receive GST or the Canada Child Benefit, it is beneficial not to delay filing to ensure entitlements are properly determined.
Deadline to pay your balance of personal income taxes owing may be deferred without penalty or interest until after August 31, 2020. Deadline to pay your June 15, 2020 personal tax installment may be deferred without penalty or interest until after August 31, 2020.

Even with these announcements, we are asking clients to provide their information to us as soon as possible, to ensure that we can continue to work towards meeting these new deadlines.

Filing Deadlines

CRA has a list of filing and payment deadlines. CRA is maintaining an updated list on their website.

Personal tax returns - filing extended from April 30 to June 1 (self-employed individuals continue to have a filing deadline of June 15). Payments for balances owing may be deferred until September 1, including the June 15 instalment payment.
Corporate tax returns - corporations with deadlines between March 18 to June 1 have an extension to file until June 1. Payments for balances owing and instalments may be deferred until September 1.
Trusts - trusts with a tax year ended December 31, 2019 had their filing deadline extended to May 1. Trusts with an original filing deadline due in April or May have been extended to June 1. Payments for balances owing and instalments may be deferred until September 1.
Charities - charities with a form T3010 whose original filing deadline falls between March 18 to December 31, 2020 have had their deadline extended to December 31, 2020.
Payroll remittances - deadlines have not been changed.
GST/HST - return deadlines have not changed. However, the CRA has stated that they won't impose penalties where a return is filed late provided that it is filed by June 30.

OTHER ITEMS

Track COVID-19 Expenses

All businesses have been advised to track any expenses related to COVID-19 in a separate line item, to allow quick reporting if a) any government assistance or insurance programs are added or b) your financial history is reviewed, it could provide an explanation for the unusual one-time costs. E.g., costs of additional cleaning, enabling a remote workforce, training.

PTMG LLP

Chartered Professional Accountants & Business Advisors