COVID-19 pandemic#Canada; #Finance; #CEBA; #Covid19; #EDC; #CECRA
Ottawa, Jun 15 (Canadian-Media): Canada's Minister of Finance Bill Morneau announced June 15 that as of Friday, June 19, 2020, applications will be accepted so that more small businesses can access the Canada Emergency Business Account (CEBA), media reports said.
Bill Morneau. Image credit: Twitter handle
Through Canada’s COVID-19 Economic Response Plan, government of Canada supporting Canadians and businesses, particularly owner-operated small businesses facing difficult challenges as a result of the global COVID-19 outbreak.
Previously being ineligible for this program, these small businesses are now eligible to apply this week for this program.
“Our government is providing support to small businesses...We want businesses to know that we are there for them, and that we are listening to their concerns. Based on the feedback we have received on the CEBA, we are pleased to make adjustments to the program and expand it so that it can help more small businesses,” said Morneau in a statement.
Launched on April 9, 2020, CEBA plans to assist the small businesses by providing zero-interest, partially forgivable loans but face ongoing non-deferrable costs, such as rent, utilities, insurance, taxes and employment costs to facilitate the post-COVID resumption of normal business operations.
To qualify under the expanded eligibility rules, CEBA applicants with payroll lower than $20,000 will need: a business operating account at a participating financial institution; a Canada Revenue Agency business number; a 2018 or 2019 tax return; and eligible non-deferrable expenses of between $40,000 and $1.5 million.
Eligible businesses will qualify for financing of up to $40,000, with 25 percent of this being forgivable based on the current terms of CEBA loans. Businesses can contact their primary financial institution for more information or can apply directly to CEBA.
Delivered by Export Development Canada (EDC), CEBA will be working closely with participating financial institutions in coming days to ensure the delivery of loans to their existing business banking customers as early as June 19, 2020.
When first launched, CEBA rapidly deployed credit to businesses with 2019 payroll between $50,000 and $1 million, but this range has been now expanded to between $20,000 and $1.5 million.
Since CEBA’s launch, more than 669,000 loans have been approved, representing a total of more than $26 billion in credit disbursed.
Additional support provided by the government to Canadian businesses through the COVID-19 outbreak includes providing a forgivable loan through the Canada Emergency Commercial Rent Assistance (CECRA) for small businesses to qualifying commercial property owner; support for COVID-19 hardest hit eligible employers through the Canada Emergency Wage Subsidy (CEWS), in place from March 15 to August 29, 2020 eligible to employers of all sizes with certain exceptions including public sector entities.
Small businesses, including self-employed individuals, would be deferred from all Goods and Services Tax/Harmonized Sales Tax (GST/HST) payments, as well as customs duty payments owed for imports, until June.
They would also be deferred to pay income taxes until after August 31, 2020. No interest or penalties will be levied on these amounts during this period.