The Government of Canada is taking immediate, significant and decisive action to help Canadians facing hardship as a result of the COVID-19 outbreak.
March 18, 2020
March 18, 2020
On March 18, 2020, the Prime Minister announced a new set of economic measures to help stabilize the economy during this challenging period. These measures, delivered as part of the Government of Canada’s COVID-19 Economic Response Plan, will provide up to $27 billion in direct support to Canadian workers and businesses.
Some highlights for businesses
Supporting Canadian Business through the Canada Account
This will allow the Govt. to provide additional support to Canadian companies through loans, guarantees, or insurance policies
Helping businesses Keep Their Workers
Proposing a temporary wage subsidy for a period of three months to small employers
Subsidy will be equal to 10% of remuneration paid during that period up to a maximum of $1,375 per employee and $25,000 per employer
Employers benefiting from this measure will include corporations eligible for the small business deduction, as well as non-profit organizations and charities
*As soon we find out how you can apply for this subsidy, we will update with the informationThe government is trying to move quickly to get this program up and running*
Flexibility for Businesses Filing Taxes
The Canada Revenue Agency will allow all businesses to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020.
Ensuring Businesses Have Access to Credit
The Business Credit Availability Program (BCAP) will allow the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) to provide more than $10 billion of additional support, largely targeted to small and medium-sized businesses.
The Bank of Canada also took a series of actions to support the Canadian economy during this period of economic stress including cutting the interest rate to 0.75% as a proactive measure in light of the negative shocks to Canada’s economy arising from the COVID-19 pandemic and the recent sharp drop in oil prices.
Some highlights for individuals
Temporary Income Support for Workers and Parents
For Canadians without paid sick leave who are sick, quarantined or forced to stay at home the Govt is:
Waiving the one-week waiting period for individuals in imposed quarantine that claim EI sickness benefits effective March 15, 2020
Waiving a requirement for a medical certificate to access EI sickness benefits
Introducing the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks. This flat-payment would provide support for those who do not qualify for EI sickness benefits, workers (incuding self-employed) who are taking care of a family member sick with COVID-19, and parents with children who require care due to school closures and are unable to earn EI
Application for the Benefit will be available in April 2020, and require Canadians to attest that they meet the eligibility requirements. They will need to re-attest every two weeks to reconfirm their eligibility. Canadians will select one of three channels to apply for the Benefit:
by accessing it on their CRA MyAccount secure portal;
by accessing it from their secure My Service Canada Account; or
by calling a toll free number equipped with an automated application process.
Longer-Term Income Support for Workers
Introducing an Emergency Support Benefit delivered through the CRA to provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment.
Implementing the EI Work Sharing Program, which provides EI benefits to workers who agree to reduce their normal working hour as a result of developments beyond the control of their employers
Income Support for Individuals Who Need It Most
The Government is proposing to provide a one-time special payment by early May 2020 through the Goods and Service Tax credit for the 12 million low and modest income families. This will double the annual payment amounts and will inject $5.5 billion into the economy.
For over 3.5 million families with children, who may also require additional support, the Government is proposing to increase the maximum annual Canada Child Benefit (CCB) payment amounts, only for the 2019-20 benefit year, by $300 per child. The overall increase for families receiving CCB will be approximately $550 on average; these families will receive an extra $300 per child as part of their May payment
Flexibility for Taxpayers
For individuals (other than trusts), the return filing due date will be deferred until June 1, 2020.
The Canada Revenue Agency will allow all taxpayers to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020.
In order to reduce the necessity for taxpayers and tax preparers to meet in person during this difficult time, and to reduce administrative burden, effective immediately the Canada Revenue Agency will recognize electronic signatures as having met the signature requirements of the Income Tax Act, as a temporary administrative measure.
Role of Financial Institutions
Banks in Canada have affirmed their commitment to working with customers to provide flexible solutions, on a case-by-case basis, for managing through hardships caused by recent developments. Canada’s large banks have confirmed that this support will include up to a 6-month payment deferral for mortgages, and the opportunity for relief on other credit products.