As we continue to receive information regarding government support for COVID-19 we wanted to provide you with 5 things you should know today about COVID-19 financial support:
- Cash Flow options and opportunities for Individuals – Many new programs, and changes to existing ones, have been announced since the onset of the COVID-19 crisis. We have put together a summary of the major options available to individuals that may be useful to bring in additional cash flow, as well as potential opportunities to decrease the amount of cash flow that needs to go out. More information.
- Cash Flow options and opportunities for Businesses – For Employers and Business owners, there have been additional government and financial institution announcements meant to provide cash flow support through wage subsidies to decrease payroll costs, allowing businesses to decrease their short-term cash outflows for taxes, GST/PST and operating cost, and increasing financing availability (including a portion of new financing that could be forgivable). More information.
- Applications for the Canada Emergency Response Benefit (CERB) have opened up this week. This program has been passed as part of the COVID-19 Emergency Response Act on March 25, 2020 and can provide $500/wk for up to 16 weeks (in the period March 15 to Sept 26) for qualified individuals that have suffered financial hardship due to COVID-19. Click here to start the application process. Since the official legislation was passed, the Government has made additional announcements that may expand the criteria for eligibility for CERB, so if you do not currently qualify under the current legislation it could be beneficial to continue to monitor for changes.
- Business loans under the Canada Emergency Business Account should soon be available through your primary bank. The final details for application were estimated to be released this week, so be sure to review your bank’s website for the latest information. These loans are government-backed, interest-free and can be up to $40,000 per business. To qualify, the business or Non-Profit Organization must be active and have had 2019 payroll between $50,000 and $1,000,000. If repaid by Dec 31, 2022, up to 25% of the loan balance could be forgiven and any amount not repaid at that time will be converted to a term loan with interest at 5%.
- Many of the Federal government programs are being administered through the CRA My Account or My Business Account. We are encouraging clients and potential program recipients to register as soon as possible. The initial registration requires personal information (including information from the 2018 personal income tax return) and can allow some access to information, however a unique authorization code is sent out by mail to complete the registration and allow full access. This can take up to 10 business days so early registration can help ensure access is in place if needed in the future. Link below to sign up:
- CRA My Account (individual)
- CRA My Business Account (business)
- Tax return filing deadlines for 2019 personal (T1), trust (T3), partnership (T5013) and corporate (T2) returns have been extended to allow for delays likely to be experienced due to closure of business and remote working by many businesses. We are strongly encouraging clients to provide their financial and tax information to us as soon as possible to ensure the returns can be prepared as soon as possible. In addition to potentially expediting the receipt of any underlying tax refunds due, having the information prepared well ahead of the deadlines allows plenty of time for planning in reaction to the current situation and early filing does not accelerate any payment dates for tax that might be payable. We strongly prefer electronic records which can be submitted through our secure portal, but can also receive records through mail or delivery to our offices between 10:00am and 3:00pm on weekdays.
We will continue to update our COVID-19 Resources as more information becomes available.
As always, if you have any questions please feel free to contact your Virtus Group Representative.