Government Support Relief for COVID-19

July 07, 2021

While COVID-19 continues to impact the world, many businesses and people are looking for support to help them through the crisis. As the situation continues to change, it can be difficult to keep track of all the programs and decide which one is most appropriate for you. This infographic will help guide you through the various programs.

Support for businesses – Federal

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Benefit

  • Subsidy will be equal to a maximum of 10% of remuneration paid during the eligible period, up to a maximum subsidy of $1,375 per employee and $25,000 per employer.
  • Allows eligible employers to reduce payroll deductions (income tax amounts only) required to be remitted to CRA. It is not a payment to employers
  • Assistance received will be taxable to the recipient employer and will reduce the amount of remuneration expenses eligible for other federal tax credits calculated on the same remuneration.
  • On July 31, 2020, the CRA released Form PD27, 10% Temporary Wage Subsidy Self-Identification Form for Employers. The CRA will use the information from an employer's PD27 to reconcile the subsidy on their payroll program (RP) accounts. This will ensure that employers do not receive a discrepancy notice at the end of the year.
  • If eligible for both the 75% CEWS and the 10% TWS, the amount paid under the 75% CEWS amount must be reduced by an amount credited under the 10% TWS in respect of remuneration paid in the same time period.

Who should apply?

  • Employers who qualify and who have not applied for CEWS.

Eligibility

  • An eligible employer can be an eligible CCPC, an individual (other than a trust), a partnership (all of the members of which are individuals, eligible CCPCs, registered charities or other eligible partnerships), a not-for-profit, or a registered charity.

Timeline

  • The eligible period begins on March 18, 2020 and ends on June 19, 2020.
  • With the release of the regulations to support the TWS on May 15, 2020, and clarifying comments in the updated FAQs for the CEWS on May 19, 2020, one key aspect of the TWS program was changed. It is now possible for employers to elect the wage subsidy rate to be 10% or a lower percentage.

Useful links

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Benefit

  • The CEWS is a wage subsidy, calculated on a per-employee, per-week basis, based on a maximum weekly wage of $1,129. The maximum subsidy that can be received varies by qualifying period (claim period), with the periods beginning in March 2020. The maximum that can be received is:
  • $847 for the first four qualifying periods of the program;
  • $960 per week for the next two qualifying periods;
  • $847 for the qualifying period that ended in September;
  • $734 for the qualifying periods that ended in October, November, and December, 2020, and
  • $847 for the qualifying periods that end in January, February, March , April, May, and June 2021.
  • In many cases, the subsidy will be less than the maximum amount, because the employee's weekly wages are less than $1129 per week or, for periods from July 5 and onwards, the employer did not experience a revenue drop that results in the highest CEWS rate.
  • The amount of subsidy that can be received is determined by the CEWS rate, which in turn is generally determined by the rate of revenue drop in a given month in 2020 or 2021 when compared to the same month in 2019 (or 2020 for some months) or average of revenue arising in January and February 2020.
  • The concept of baseline remuneration is relevant in some cases when determining CEWS.
  • It is particularly important for non-arm's length employees in benchmarking wages paid prior to the beginning of the CEWS period of March 15, 2020. Where a non-arm's length employee does not have remuneration in one of the baseline periods, no CEWS can be claimed for that individual.
  • The July 17 legislation expanded the baseline periods from one, January 1 to March 15, 2020, to also include several periods in 2019. The expansion of the number of baseline remuneration periods particularly benefits CEWS claims for seasonal employees, as well as for non-arm length employees.
  • The March 3, 2021 draft legislation further expanded the baseline periods to include a new baseline period from March 1, 2019 to June 30, 2019 for the last three CEWS qualifying periods that end in April, May and June 2021.
  • Specific rules are provided in the legislation with respect to the computation of the employer's qualifying revenue

Who should apply?

  • Employers that have had a downturn in gross revenues and need support to avoid laying off or looking to hire back employees.

Eligibility

  • Eligible employers include: individuals, taxable corporations, partnerships consisting of eligible employers, taxable corporations, NPOs and registered charities.
  • For qualifying revenues in March 2020, there must have been a comparative decline in revenue of at least 15% in order to be eligible for CEWS. This was increased to 30% for comparative revenue declines in each of April, May, and June of 2020. For these four periods, the CEWS rate was fixed at 75%. For the remainder of the qualifying periods, from July 2020 through June 2021, there is no minimum revenue decline required to qualify for CEWS, but the amount of CEWS is dependent on the comparative revenue decline in those qualifying periods.

Timeline

  • The 2021 Federal Budget (released on April 19, 2021) announced changes the CEWS program, including:
  • Extending the CEWS program by four more periods, to September 25, 2021
  • Gradually decreasing the maximum subsidy rate from 75% to 20%, beginning July 4, 2021.
  • Beginning July 4, 2021, only organizations that experience a revenue decline of more than 10% will be eligible for CEWS
  • Imposing a new requirement for publicly traded companies to repay the wage subsidy received for qualifying periods that start after June 5, 2021, where the aggregate compensation for certain specified executives in the 2021 calendar year exceeds the aggregate compensation for such executives paid during the 2019 calendar year.

Useful links

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Benefit

  • Proposed as part of the 2021 Federal Budget (on April 19, 2021), the Canada Recovery Hiring Program (CRHP) is a new wage subsidy program
  • Provides a subsidy to employers who add to their remuneration expense by adding employees or increasing what existing employees are paid
  • Special rules restrict this subsidy for non-arm's length wages, and for furloughed employees

Who should apply?

  • Employers who have increased their remuneration expenses since the four-week period March 14 to April 10, 2021 and have also experienced a decline in revenue compared to pre-COVID revenue.

Eligibility

  • The increase to compensation can be for full-time or part-time employees. The increase in remuneration is measured from the four-week period March 14 to April 10, 2021 and is compared to the period in respect of which a claim is made. Claim periods will start on June 6, 2021, and are currently planned to run until November 20, 2021
  • Must be a “qualifying recovery entity”, which includes entities that qualify for CEWS except that for-profit corporations must be CCPCs (or would be CCPC's if not for S.136(1), which deems cooperatives to not be private corporations)
  • The restriction on non-CCPCs also applies to partnerships where 50% or more of their fair market value is held by non-qualifying entities
  • Must have experienced a revenue decline in the qualifying period, or the immediately previous qualifying period of:
    • More than 0% in the first qualifying period for the CRHP (June 6 – July 3), or
    • More than 10% for any qualifying period starting after July 3, 2021

Timeline

  • The same four-week periods that apply for CEWS and CERS apply for the CRHP, except that it is anticipated that the CRHP program will run until November 2021, while the CEWS and CERS programs are scheduled to end by September 25, 2021.

Useful links

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Benefit

  • Open to large for-profit businesses – except for those in the financial sector – as well as certain not-for-profit businesses, such as airports, with annual revenues generally in the order of $300 million or higher.
  • Delivered by the Canada Development Investment Corporation (CDEV), in cooperation with Innovation, Science and Economic Development Canada (ISED) and the Department of Finance.
  • Program provides bridge financing to Canada's largest employers, whose needs during the pandemic are not being met through conventional financing, in order to keep their operations going.

Who should apply?

  • Canadian employers who (a) have a significant impact on Canada's economy, as demonstrated by (i) having significant operations in Canada or (ii) supporting a significant workforce in Canada, ; (b) can generally demonstrate approximately $300 million or more in annual revenues; and (c) require a minimum loan size of about $60 million.

Eligibility

  • The loan size for each applicant will be assessed on a case by case basis based on demonstrated need
  • LEEFF will be open while the economic situation persists

Useful links

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Benefit

  • Through the EDC BCAP Guarantee, EDC will partner with an approved financial institution to provide eligible businesses with additional credit. This guarantee is specifically for new operating lines of credit or new term loans to sustain operations in response to COVID-19
  • The size of the loan or line of credit is determined by the financial institution
  • EDC fees related to this guarantee may be deferred for the first six months for smaller credit amounts
  • The government announced that the program will be extended to June 2021
  • On June 2, 2021, the government announced that this program is being extended to December 31, 2021 (from June 30, 2021)

Who should apply?

  • Eligible businesses
  • As well, eligibility for the EDC BCAP Guarantee is subject to additional requirements through approved financial institutions.

Useful links

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Benefit

  • This $25 billion program will provide interest-free loans of up to $60,000 to small businesses and not-for-profits, to help cover their operating costs during a period where their revenues have been temporarily reduced.

Who should apply?

  • Small businesses and NPO's that need help covering operating costs.

Eligibility

  • If the conditions of the CEBA program are met, up to $20,000 of the loans will be forgiven. However, if the loan is not repaid by December 31, 2022, it can be converted to a three-year term loan with a 5% interest rate
  • There are two streams under which an organization can apply – the Payroll Stream and the Eligible Non-Deferrable Expense Stream.
    • Payroll Stream – Under this stream, applicants must have had total payroll between $20,000 and$1.5 million in 2019.
    • Eligible Non-Deferrable Expense Stream – Under this stream, available to organizations that did not have sufficient payroll in 2019.
      • Applicants must have a CRA BN and filed a 2018 or 2019 tax return and have eligible non-deferrable expenses between $40,000 and $1.5 million, such as rent, property tax, utilities and insurance.
  • All applications for the CEBA are made through an organization's financial institution website. If applying through the Payroll Stream, the application process is relatively straightforward. Once submitted, the application will be looked at by the government and if approved, funds will be provided to the applicant in their business account
    • The CEBA can be used to pay for eligible non-deferrable expenses According to the CEBA website, these include the following:
      • Wages and other employment expenses to independent (arm's length) third parties;
      • Rent or lease payments for real estate
      • Rent or lease payments for capital equipment
      • Insurance related expenses;
      • Property taxes;
      • Telephone and utility expenses (such as gas, oil, electricity, water and internet)
      • Payments for regularly scheduled debt service;
      • Payments incurred under agreements with independent contractors
      • Fees required in order to maintain licenses, authorizations or permissions necessary to conduct business:
      • Materials consumed to produce a product ordinarily offered for sale by the borrower.
  • The funds obtained from the CEBA cannot be used for prepayment or refinancing of existing indebtedness, payments of dividends, distributions and increases in management compensation

Timeline

  • On March 22, 2021, the government announced that the deadline to apply for the CEBA is extended to Jne 30 (from March 31, 2021).

Useful links

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Benefit

  • The BDC, together with financial institutions will co-lend term loans to SMEs, for their operational cash flow requirements.

Who should apply?

  • Eligible businesses.

Eligibility

  • Canadian businesses that are directly impacted by COVID-19 may be eligible for a loan between $1 million and $12.5 million for cash flow needs, including regularly scheduled principal and interest payments on existing debt.

Useful links

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Benefit

  • The BDC, together with financial institutions, will guarantee amounts ranging from $25,000 to $1 million to ensure a degree of continuity for business through the pandemic
  • The loan guarantees are for small and medium-sized businesses that have seen their revenues decrease by 50% or more as a result of COVID-19
  • Eligible businesses can benefit from a 4% interest rate, a repayment term of up to 10 years and up to a 12-month postponement of principal payments at the start of the loan

Who should apply?

  • Eligible businesses

Eligibility

  • Eligibility criteria include:
    • Ability to demonstrate a minimum 50% revenue decline for at least three months (not necessarily consecutive) within the eight-month period prior to the date of application
    • Already qualify for, or are receiving, either CEWS or CERS (although can still apply if an eligible business does not qualify for CEWS and CERS, as long as the business otherwise meets all HASCAP eligibility criteria)
  • Eligible businesses can apply directly with their financial institution, as of February 1, 2021
  • On June 2, 2021, the government announced that this program is being extended to December 31, 2021 (from June 30, 2021)

Useful links

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Benefit

  • The RRRF provides over $1.5 billion of funding nationally. As part of the Economic Statement, the federal government is proposing to add an additional $500 million of funding

Who should apply?

  • Businesses and communities that are unable to access other federal relief measures, or that may require additional support during the pandemic

Eligibility

  • The funds are administered and delivered by Canada's regional development agencies:
    • Atlantic Canada Opportunities Agency (ACOA)
    • Canada Economic Development for Quebec Regions (CED)
    • Federal Economic Development Agency for Southern Ontario (FedDev Ontario)
    • Federal Economic Development Agency for Northern Ontario (FedNor)
    • Western Economic Diversification Canada (WD)
    • Canadian Norther Economic Development Agency (CanNor)

Timeline

  • The 2021 Federal Budget proposes to extend the application date for this funding to June 30, 2021

Useful links

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Benefit

  • Work sharing is an adjustment program designed to help employers and employees avoid layoffs when there is a temporary reduction in the normal level of business activity that is beyond the control of the employer.
  • The program provides income support to employees eligible for EI benefits who work a temporarily reduced work week while their employer recovers.

Who should apply?

  • Work-Sharing is a three-party agreement involving employers, employees and Service Canada.
  • Employees on a Work-Sharing agreement must agree to a reduced schedule of work and to share the available work over a specified period of time.

Eligibility

  • The employer and the employees (and the union, if applicable) must agree to participate in a Work-Sharing agreement and must apply together.

Timeline

  • Reduction in hours by employee can be from half day to 3 days.
  • Maximum duration is 76 weeks, minimum duration is 6 weeks.
  • An application for a Work-Sharing agreement must be submitted a minimum of 10 days prior to the requested start date.

Useful links

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Benefit

  • Announced on October 9, the CERS is to replace the Canada Emergency Commercial Rent Assistance for small business program (which closed to new applications on September 30) as a means of providing commercial rent relief
  • CERS is provided directly to tenants, and property owners
  • CERS amount is comprised of a base amount plus a top-up:
    • Base rent subsidy: The base amount will cover, on a sliding scale, up to a max. of 65% of qualifying rent expenses. The max. 65% will be available to businesses that demonstrate a revenue decline of 70% or more (for businesses with less than a 70% decline, the subsidy will decrease in line with the decline in revenues)
    • Lockdown Support: A top-up amount of 25% of qualifying expense will be available to businesses subject to additional lock-down restrictions.
  • There is a limit of $75,000 on the total amount of qualifying rent expenses allowed per location per qualifying period and an overall cap of $300,000 of eligible expense per qualifying period. This overall cap only applies for the purposes of calculating the amount of base rent subsidy and does not affect the calculation of the Lockdown Support, if applicable.
  • The 2021 Federal Budget (released on April 19, 2021) announced changes the CERS program, including:
    • Extending the CERS program by four more periods, to September 25,2021.
    • Gradually decreasing the maximum subsidy base rate from 65% to 20%, beginning July 4, 2021. Lockdown Support will remain at the current 25% rate.
    • Beginning July 4, 2021, only organizations that experience a revenue decline of more than 10% will be eligible for CERS
  • The CRA is administering the CERS. Applications are made through My Business Account. The CRA opened its online application portal opened on November 23, and began processing applications as of November 30, 2020.
  • On May 20, 2021, the CRA updated their website and announced that the minimum lockdown period can span across two different claim periods and that if the CRA's CERS calculator was used on or before May 20, 2021, it may not have accurately calculated a lockdown support if a lockdown period overlapped two or more claim periods.

Who should apply?

  • Eligible entities, including businesses, charities, and non-profits that experience a drop in revenue requiring assistance with rent and/or mortgage interest payments.

Eligibility

  • Qualifying rent expense for eligible commercial tenants generally includes:
    • Rent, including gross rent, and rent based on percentage of sales, profit or similar criteria;
    • Amounts required to be paid under a net lease (either to the lessor or a third party) including base rent, operating expenses such as insurance, utilities and common area maintenance expenses;
    • Property taxes, including school and municipal taxes; and
    • Other amounts paid for ancillary services customarily supplied or rendered in connection with commercial rent
  • Qualifying rent expense for property owners generally includes:
    • Mortgage interest (determined within defined limits);
    • Insurance on the real property; and
    • Property taxes, including school and municipal taxes
  • Expenses incurred by property owners who use the real property, whether directly or indirectly, to earn rental income from an arm's length entity will not be eligible expenses for the CERS.
  • Eligible expenses must be paid or payable to an arm's length party, by written agreement in place before October 9, 2020. If unpaid, applicants must attest that amounts will be paid within 60 days following the receipt of their CERS support payment. If not paid within this timeframe, expenses will not be eligible for CERS.

Timeline

  • CERS will be available retroactively, beginning on September 27 and until June 2021.
  • The government tabled draft legislation (Bill C-9) to create the CERS program in the House of Commons on November 2 and it received Royal Assent on November 19.
  • The legislation included rates up to December 19, 2020 (i.e. for first 3 qualifying periods of the CERS) Periods 3-6, up to March 13, 2021, were enacted by regulation and legislation was released on March 3, 2021 detailing Periods 7-9, up to June 5, 2021. The rates are to remain unchanged for all periods of the CERS, up to June 5, 2021.

Useful links

Support for individuals – Federal

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Benefit

  • The CRB provides a taxable benefit amount of $500 per week for up to 38 weeks to those workers who are ineligible for EI, including those who are self-employed or who work in the gig economy
  • Claimants will have to look for and accept work when reasonable to do so
  • Recipients will be required to repay 50 cents of the CRB received for each dollar they earned above net annual income of $38,000 in the calendar year (up to a maximum of the CRB they received)
  • Effective for one year, from September 27, 2020 to September 25, 2021
  • The CRA is administering the CRB (along with the CRSB and CRCB)
  • The CRA will withhold 10% tax at source from all recovery benefit payments
  • Applications opened on October 12 through CRA's My Account

Who should apply?

  • Workers who are ineligible for EI but continue to require income support following the end of the CERB as a result of COVID-19

Eligibility

  • The CRB is available to
    • those that are resident and present in Canada, who are at least 15 years old; and have a valid SIN
    • have stopped working due to COVID-19 and are available and looking for work, or who are working and have had a 50% reduction in their average weekly income as a result of COVID-19;
    • did not apply for or receive the CRSB, CRCB, short-term disability benefits, worker's compensation benefits, EI benefits, or Quebec Parental Insurance Plan (QPIP) benefits;
    • are not eligible for EI;
    • had earned income from employment or self-employment income and/or maternity or parental benefits (from EI or similar QPIP) of at least $5,000 in 2019, 2020 or in the 12 months before the date of application; and
    • have not quit their job or reduced their hours voluntarily.
  • Each payment covers a 2-week period. and
  • and recipients will have to reapply every two weeks and attest that they continue to meet the requirements

Timeline

  • As part of the 2021 Federal Budget released on April 19, 2021, the government announced that the CRB will be extended by 12 weeks, to a maximum of 50 weeks:
    • The first four weeks of this extension will be paid at $500 per week and the remaining 8 weeks will be paid at $300 per week

New CRB claimants after July 17, 2021 will be eligible to receive $300 per week, up to September 25, 2021.

Useful links

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Benefit

  • The CRSB provides a taxable benefit of $500 per week for up to four weeks to eligible workers who are sick or need to self-isolate due to COVID-19, or have an underlying condition that puts them at greater risk of contracting COVID-19
  • The CRA is administering the CRB (along with the CRB and CRCB)
  • The CRA will withhold 10% tax at source from all recovery benefit payments

Who should apply?

  • Workers who are unable to work because they contracted COVID-19, have an underlying condition or other illness that would make them more vulnerable to COVID-19, or who are required to self-isolate

Eligibility

  • The CRSB is available to workers who:
    • reside and are present in Canada;
    • are at least 15 years old and have a valid SIN;
    • are employed or self-employed at the time of application;
    • did not apply for or receive the CRB, CRCB, short-term disability benefits, worker's compensation benefits, EI benefits, or QPIP benefits; and
    • earned at least $5,000 of income from employment, self-employment, and/or maternity or parental benefits (from EI or similar QPIP) in 2019, 2020 or in the 12 months before the date of application.
  • Workers will need to have missed a minimum of 50% of their scheduled work in the week for which they claim the benefit.
  • Cannot claim the CRSB if receive other paid sick leave from employer for same benefit period.

Timeline

  • Effective for one year, from September 27, 2020 to September 25, 2021.
  • Applications opened on October 5 through CRA's My Account.

Useful links

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Benefit

  • The CRCB provides a taxable benefit of $500 per week, for up to 38 weeks per household, to eligible Canadians unable to work because they need to provide care to children or support to other dependents who must stay home because of COVID-19
  • The CRA is administering the CRB (along with the CRB and CRSB)
  • The CRA will withhold 10% tax at source from all recovery benefit payments

Who should apply?

  • Canadians unable to work because they need to provide care to a child or other dependent due to COVID-19.

Eligibility

  • In order to be eligible for the CRCB, individuals must:
    • reside and be present in Canada;
    • be at least 15 years old on the first day of the period for which they apply for the benefit;
    • have a valid SIN;
    • have earned at least $5,000 of employment income, self-employment income, and/or maternity and parental benefits (from EI or QPIP) in 2019, 2020, or in the 12 months before the date of application;
    • have been unable to work for at least 50% of their normal scheduled work within a given week because they are caring for their child (under the age of 12 on the first day of the period for which the benefit is claimed), or a family member who requires supervised care, because of one of the following reasons:
      • their school, daycare, or care facility is closed or unavailable due to COVID-19;
      • they contracted COVID-19 (or are experiencing symptoms of COVID-19), are required to isolate, or have been advised by a medical professional that they are at high risk if they contract COVID-19; or
      • their regular caregiver is not available due to reasons related to COVID-19;
    • not be in receipt of paid leave from an employer in respect of the same week; and
    • not have applied for or received the CRB, CRSB, short-term disability benefits, worker's compensation benefits, EI benefits, or QPIP benefits in respect of the same period
  • Two members residing in the same household cannot be in receipt of the benefit for the same period.

Timeline

  • Effective for one year, from September 27, 2020 to September 25, 2021
  • Applications opened on October 5 through CRA's My Account
  • As part of the 2021 Federal Budget released on April 19, 2021, the government announced that the CRCB will be extended by 4 weeks, to a maximum of 42 weeks

Useful links


The information in this publication is current as of July 7, 2021.

This publication has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only. The publication cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information contained therein without obtaining specific professional advice. Please contact BDO Canada LLP to discuss these matters in the context of your particular circumstances. BDO Canada LLP, its partners, employees and agents do not accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this publication or for any decision based on it.

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