March 25, 2020 - Resources for Individuals & Businesses
Over the last week, both the federal government and the provincial governments have been working hard to develop programs and offer support. Canada’s Economic Response Plan outlines programs aimed at improving cashflow for individuals and businesses by deferring payments, improving financing options or providing subsidies to those most affected.
Through our network of CPA partner firms and professionals, we have access to information, education, and thought leadership. To support our clients, we have provided the links to the federal and provincial programs along with several well written resources that do a good job summarizing the opportunities for individuals and business owners to access support at the federal and provincial level.
Content available within this blog post:
Government of Canada Programs for Businesses
Government of Canada Programs for Individuals
GOVERNMENT OF CANADA PROGRAMS FOR BUSINESSES
Visit the Canadian government website for businesses for information about supporting your employees and your business. It will be constantly updated as the COVID-19 crisis evolves.
Download the Canada Business App to find tailored supports to address your specific needs and questions about COVID-19.
Consult the Canadian Chamber of Commerce’s pandemic preparedness guide to help prepare your business in the days and weeks to come.
To help provide some stability for businesses through this time of uncertainty, the Office of the Superintendent of Financial Institutions (OSFI) is lowering the Domestic Stability Buffer requirement, releasing more than $300 billion of additional lending capacity for Canadian financial institutions. Contact your bank.
COVID-19 Small Business Help Centre, Canadian Federation of Independent Business
Changes to the Canada Account
The government is making changes to the Canada Account so that the Minister of Finance would now be able to determine the limit of the Canada Account in order to deal with exceptional circumstances. The Canada Account is used to support export transactions which the EDC is unable to support, but which are determined by the Minister for International Trade to be in Canada's national interest. This will allow the government to provide additional support to Canadian companies through loans, guarantees or insurance policies.
Eligible small employers (payroll of <$1 million) are granted a temporary wage subsidy equal to 10% of renumeration paid for a period of three months up to a maximum subsidy of $1,375 per employee and $25,000 per employer. Businesses will be able to benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration. (No application necessary).
Enhancing the Work-Sharing Program by expanding eligibility for EI benefits to workers who voluntarily reduce their working hours.
Filing Business Taxes
The Canada Revenue Agency (CRA) will allow all businesses to defer payment of any income tax amounts that become owing on or after March 18, until after August 31, 2020. This applies to tax balances due, as well as instalments, under Part I of the Income Tax Act.
No interest or penalties will accumulate on these amounts during this period.
The CRA will not contact any small or medium enterprise (SME) to initiate any post assessment GST/HST or Income Tax audits for the next four weeks.
Traditionally available in-person, the Liaison Officer service is now available over the phone.
Ensuring Businesses Access to Credit
Increase credit available to farmers through Farm Credit Canada. Sign up for FCC Online Services.
The Canada and the US border is closed to all non-essential travel (recreation and tourism), travel for trade and work purposes will not be impacted.
Canadian Life and Health Insurance Association has confirmed that commercial truckers with group insurance coverage will continue to have coverage for emergency out-of-country medical expenses as they bring goods across the US-Canada border.
Business Development Bank (BDC) and Export Development Canada (EDC) programs
In response to the financial hardship experienced by Canadians and Canadian businesses during the COVID-19 outbreak, the Government of Canada has established the Business Credit Availability Program (BCAP) to further support financing the private sector through the Business Development Bank (BDC) and Export Development Canada (EDC). These measures are effective March 18, 2020 for qualified businesses.
Details regarding BCAP, including specific industry support, is expected within the coming days. Businesses seeking support through BCAP should first contact their financial institutions for an assessment of their situation. Qualifying businesses will be referred by their financial institutions to BDC and EDC if their needs extend beyond what is available through the private sector alone.
The BDC supports SMEs of all industries and the measures in response to COVID-19 are:
Working capital loans of up $2million with flexible terms and payment postponements for up to 6 months.
Postponement of payment for up to 6 months, free of charge, for existing BDC clients with total BDC loan commitment of $1million or less.
Reduced rates on new eligible loans.
Specific details on financial support are expected within the coming days. The EDC urges its clients to contact an EDC trade advisor for support.
Phone: 1-888-220-0047 between 9a.m. and 5p.m.
GOVERNMENT OF CANADA PROGRAMS FOR INDIVIDUALS
EI Sickness Benefits: Apply, Government of Canada
Application for the Emergency Care Benefit will be available in April through 1 of 3 channels:
By accessing it on the CRA MyAccount secure portal
By accessing it from the secure My Service Canada Account
By calling a toll-free number (not yet made public)
Department of Finance, Canada’s COVID-19 Economic Response Plan
For Canadians without paid sick leave (or similar workplace accommodation) who are sick, quarantined or forced to stay home to care for children, the Government is:
Waiving the one-week waiting period for those individuals in imposed quarantine that claim Employment Insurance (EI) sickness benefits. This temporary measure will be in effect as of March 15, 2020. (EI Application)
Waiving the requirement to provide 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 Benefit would be administered through the Canada Revenue Agency (CRA) and provide income support to:
Workers, including the self-employed, who are quarantined or sick with COVID- 19 but do not qualify for EI sickness benefits.
Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not quality for EI sickness benefits.
Parents with children who require care or supervision due to school closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.
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 (not yet made public) equipped with an automated application process.
Longer-Term Income Support for Workers
For Canadians who lose their jobs or face reduced hours as a result of COVID’s impact, 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. Enhancing the Work-Sharing Program by expanding eligibility for EI benefits to workers who voluntarily reduce their working hours. Eligibility has been extended to 76 weeks, requirements have been relaxed and the application process has been streamlined.
Tax Benefits and Credits
For low- and modest-income families, the Government is proposing to provide a one-time special payment by early May 2020 through the Goods and Services Tax credit (GSTC). This will double the maximum annual GSTC payment amounts for the 2019-20 benefit year. 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 Canada Revenue Agency will defer the filing due date for the 2019 tax returns of individuals, including certain trusts until June 1, 2020.
For trusts having a taxation year ending on December 31, 2019, the return filing due date will be deferred until May 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. This relief would apply to tax balances due, as well as instalments, under Part I of the Income Tax Act. No interest or penalties will accumulate on these amounts during this period.
The Canada Revenue Agency will recognize electronic signatures as having met the signature requirements of the Income Tax Act.
The Canada Revenue Agency is adapting its Outreach Program to be available over the phone, and through webinar.
Mortgage Default Management Tools
The Canada Mortgage and Housing Corporation (CMHC) and other mortgage insurers offer tools to lenders that include payment deferral, loan re-amortization, capitalization of outstanding interest arrears and other eligible expenses, and special payment arrangements.
The CMHC will permit lenders to allow payment deferral on homeowner CMHC-insured mortgage loans beginning immediately.
Insured Mortgage Purchase Program (IMPP) will allow the government to purchase $50 billion of uninsured mortgage pools through CMHC. Details of the terms of the purchase operations will be provided to lenders by CMHC at a later date.
Other targeted help
Providing $305 million for a new distinctions-based Indigenous Community Support Fund to address immediate needs in First Nations, Inuit, and Métis Nation communities.
Placing a six-month interest-free moratorium on the repayment of Canada Student Loans for all individuals currently in the process of repaying these loans.
Reducing required minimum withdrawals from Registered Retirement Income Funds (RRIFs) by 25% for 2020. Similar rules would apply to individuals receiving variable benefit payments under a defined contribution Registered Pension Plan.
Providing the Reaching Home initiative with $157.5 million to continue to support people experiencing homelessness during the COVID-19 outbreak.
Providing up to $50 million to women’s shelters and sexual assault centres
Alberta - Useful Links
COVID-19 Info for Albertans, Government of Alberta
COVID019 Self-Assessment, Government of Alberta
Premier Jason Kenney announced an Alberta Emergency Isolation Support package worth $50M comprising:
90-day deferrals of electricity and natural gas utility payments
Six-month deferral of student loan payments
Mortgage deferrals through Alberta Treasury Branches
Emergency care benefit that matches EI payments (to be online next week)
Alberta employers will also be allowed to defer the collection of corporate income tax balances until August 31, 2020.
Changes to the Alberta Employment Standards Code made to allow employees who are required to self-isolate or are caring for a loved one with COVID-19 to take 14 days of paid job-protected leave to cover the recommended self-isolation period. Additionally, typical legislative requirements to qualify for a leave of absence, such as obtaining a medical note or having worked for at least 90 days, will not be required. Upcoming expiry dates for Alberta drivers’ licenses, vehicle registrations, other permits and certificates are being extended until May 15. Those with Alberta government-sponsored Coverage for Seniors and Non-Group coverage programs will pay a lower co-payment of up to $8 per prescription for a 30-day supply. The current co-payment is up to $25 per prescription. Albertans with other coverage should consult with their benefits provider. Albertans can now meet with Alberta-licensed physicians through their smartphone, thanks to an initiative by TELUS Health. Albertans can use the service to check symptoms, book appointments, see a doctor, and get prescriptions and referrals for diagnostic imaging and specialists – all covered by Alberta Health Care.
PRIVATE SECTOR MEASURES
In response to the financial hardship experienced by Canadians and Canadian businesses during the COVID-19 outbreak, the Big Six banks have made a joint commitment to work with personal banking customers on a case-by-case basis to provide flexible solutions to help customers manage challenges such as pay disruption due to COVID-10; childcare disruption due to school closures; or those facing illness from COVID-19. Customers are being asked to reach out to their banks to see what assistance is available for them. Due to the large volume of customer inquiries, delays are to be expected.
Support is expected to include up to a six-month payment deferral for mortgages and the opportunity for relief on other credit products.
The extreme volatility we are seeing today requires a ‘two feet on the floor’ approach by all
integrated wealth advisors and clients who stand to be affected. Advisors and clients need to enter into a ground level risk and review period to address concerns that are a perceived threat to goals and objectives for the future. Although future forecasting is difficult not only fiscally but emotionally as well, strategies and solutions that ease the minds of clients is what integrated wealth advisory was designed for - a three hundred and sixty degree view of options and strategic implementation - and now is the time for Canadians to engage and get a return on investment through trusted advice.
Contact us to book a free Portfolio and Insurance review. WealthCo stands beside each of our clients and their unique goals and objectives for the future with long term growth, development and a shield against the volatility of a rapidly changing economic landscape.