Updated: April 27, 2020
The COVID-19 pandemic has brought economic hardships to all Canadians, but it is within the small business community where these disparities are the most impactful. Small businesses are particularly vulnerable to layoffs, increased debt, and potential foreclosures. And yet, as reported in 2017, they represent 97.9% of the 1.18 million employer businesses in Canada.
Simply put, small businesses are the backbone of our economy which is why it’s important to support them as much as possible during this difficult time. For us, getting small business owners the information they need to acquire financial support is just one of the ways we can help.
Below, we have consolidated and compiled various support options from the Government of Canada’s COVID – 19 economic response plan for businesses. More detailed information can be found on their site. We will be checking the Government of Canada’s website regularly and updating any resources as they are announced.
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- Subsidies to avoid layoffs and to rehire employees
- Credit available for SMEs operational costs
- Support for self-employed individuals
- Support for rural business communities
- Funding for the innovation sector
- Funding for entrepreneurs aged 18-39
- Support for small and medium-sized businesses (unable to access other support measures)
- Deferred tax payments
- Support for Indigenous Businesses
Avoiding layoffs and rehiring employees
Canada Emergency Wage Subsidy (CEWS)
- For any employers who have suffered a drop in gross revenues of at least 15% in March, and 30% in April and May.
- Subsidy covers 75% of an employee’s wages up to $847 per week
- Program in place from March 15 – June 6
- Eligible employers are entitled to receive a 100% refund for certain employer contributions to Employment Insurance, the Canada Pension Plan, the Quebec Pension Plan, and the Quebec Parental Insurance Plan
- Applications will be open April 27
Temporary 10% Wage Subsidy
- Three-month measure that will allow eligible employers to reduce the amount of payroll deductions required to be remitted to the Canada Revenue Agency (CRA).
- Subsidy is equal to 10% of the remuneration you pay from March 18, 2020 to June 19, 2020 for each eligible employee to a maximum of $25,000 total per employer.
- This subsidy is calculated when you remit these amounts to the CRA.
- Any benefit from this subsidy for remuneration paid in a specific period will generally reduce the amount available to be claimed under the CEWS in that same period.
- How to calculate the subsidy amount
Work-sharing (WS) Program
- Program provides Employment Insurance (EI) benefits to eligible employees who agree to reduce their normal working hours and share the available benefits while their employer recovers.
- Extension of the program maximum duration to 76 weeks
- Application forms and information
Business Credit Availability Program (BCAP)
1. Canada Emergency Business Account (CEBA)
- Provides credit for small businesses and not-for-profits to pay for immediate operating costs such as rent, payroll, utilities, insurance, property tax, or debt service.
- Available to Canadian employers with $20,000 to $1.5 million in total payroll in 2019, and operating as of March 1, 2020.
- Under CEBA, financial institutions will be able to provide interest-free credit facilities of up to $40,000 to eligible businesses.
- If the loan is repaid by December 31, 2022, 25% (up to $10,000) will be forgiven.
- If the loan is not repaid by December 31, 2022, the remaining balance will be converted to a three-year term loan at 5% interest.
- Contact your primary lender to apply.
- Learn more about the Canada Emergency Business Account.
2. Loan Guarantee for Small and Medium Enterprises
- Export Development Canada (EDC) is working with financial institutions to issue new operating. credit and cash flow term loans of up to $6.25 million to small and medium-sized enterprises.
- Contact your primary lender to apply.
3. Co-Lending Program for Small and Medium Enterprises
- The Business Development of Canada (BDC) is working with financial institutions to co-lend term loans to SMEs for their operational cash flow requirement.
- Loans up to $312,500 to businesses with revenues of less than $1 million.
- Up to $3.125 million for businesses with revenues between $1 million and $50 million.
- Up to $6.25 million for businesses with revenues in excess of $50 million.
- Loans would be interest-only for the first 12 months, with a 10-year repayment period.
- Contact your primary lender to apply.
- Learn more about the BDC Co-Lending Program for SMEs.
Canada Emergency Response Benefit (CERB)
- Self- employed individuals can receive a taxable benefit of $2000 every 4 weeks for up to 16 weeks.
- Recipients are allowed to earn up to $1000 a month while collecting their CERB payments.
- Application and more information.
Rural Business Communities
- The Government of Canada is providing $287 million to support rural businesses and communities
- Reach out to your Regional Development Agency
Innovative and Early-Stage Businesses
The Canadian Government is investing $250 million to assist innovative, early-stage companies that are unable to access other COVID-19 business supports through the Industrial Research Assistance Program (IRAP).
1. The COVID-19 Challenges Procurement Program: NRC Industrial Research Assistance Program and Innovative Solutions Canada
- This program will post challenges seeking near-to-market solutions from small and medium-sized businesses (fewer than 500 staff) that need financial support to refine and sell their product or solution to meet a COVID-19 related need.
- To register and for more information.
2. The Pandemic Response Challenge Program: National Research Council of Canada
- This program will build teams to address challenges requiring further research and development for solutions to meet COVID-19 related needs.
- Funding is available to help cover the costs of research for academic institutions, small and medium-sized businesses, and other eligible recipients participating in the challenge teams.
- To register or for more information.
Young Entrepreneurs (Ages 18 – 39)
- Providing $20.1 million in support for Futurpreneur Canada to continue supporting young entrepreneurs across Canada who are facing challenges due to COVID-19. The funding will allow Futurpreneur Canada to provide payment relief for its clients for up to 12 months.
- For more information on how to apply, and repayment terms & fees
Small and Medium-sized businesses (unable to access other support measures)
- The Government of Canada is providing $675 million to give financing support to small and medium-sized businesses that are unable to access other COVID-19 business supports, through Canada’s Regional Development Agencies.
- For more information and to apply through your Regional Development Agency
- Businesses and self-employed individuals can defer, until after August 31, 2020, any income tax amounts that become owing on or after March 18 and before September 2020.
- This relief would apply to tax balances due and installments.
- No interest or penalties will accumulate on these amounts during this period
- Businesses and self-employed individuals can defer payments of GST/HST and customs duty owing on imports until after June 30, 2020.
- All tax and payment dates.
- More information on deferral of GST/HST tax remittances
- Financial support for Indigenous businesses will be provided through Aboriginal Financial Institutions and administered by the National Aboriginal Capital Corporations Association and the Métis capital corporations in partnership with Indigenous Services Canada.
- More information on financial support for Indigenous businesses.