COVID-19: CRA & BC Updates
for the week of March 30, 2020
Last updated: April 1, 2020
Over the course of this week, Prime Minister Justin Trudeau will be announcing more details of the Canada Emergency Wage Subsidy program along with other updates. We will be updating this post with a summary of the latest releases so that you can stay informed.
Earlier this week
Canada Emergency Wage Subsidy Program (CEWS)
On April 1st 2020, the Government of Canada more details in regards to the wage subsidy program for the period of March 15 to June 15, 2020. We are updating the below details as more information becomes available.
The program will directly pay businesses for 75% of the pre-crisis payroll cost, up to of $847 per employee, per week, for all employees remaining on the business’ payroll. Click here to download a handy spreadsheet to help you calculate CEWS.
Alternatively, CRA has put together a CEWS calculator on their website.
CEWS Qualification Criteria
- Eligible employers must show that they suffered a drop in gross revenues of at least 30% in March, April, or May, when compared to the same month(s) in 2019. For businesses that did not have operations in March to May 2019, the February 2020 revenues can be used as a comparative.
- The subsidy is only available for employees who were on payroll prior to March 15, 2020. It is also available to new hires who are not shareholders or family members of shareholders (arms-length).
- The amount of the subsidy per employee will be the lower of the amount actually paid to the employee and 75% of the employee’s pre-crisis wages and salary up to $847/week.
- Employers will be required to attest that they are doing everything in their power to pay the remaining 25% of the wages to their employees.
- The benefits will be paid out directly to businesses; this will not be paid through a reduction of payroll withholdings, taxes, or other government payments.
- Eligible employers would be able to access the CEWS by applying through a Canada Revenue Agency online portal.
- The funds will be applicable to wages and salaries paid out to employees from March 15, 2020 through June 6, 2020.
- The funds will be paid out by CRA in approximately 6 weeks (week of May 13, 2020).
- The funds will be received quicker if the business is set up for direct deposit with its CRA business number account.
- Businesses that do not qualify for the Canada Emergency Wage Subsidy may continue to qualify for the previously announced wage subsidy of 10 percent of remuneration paid from March 18 to before June 20, up to a maximum subsidy of $1,375 per employee and $25,000 per employer.
- More details regarding how to apply for the program will be announced at a later date.
Canada Emergency Response Benefit (CERB)
The $2,000/month benefit is available to individuals who stopped work and are not earning employment or self-employment income as a result of reasons related to COVID-19. The application will be open on April 6, 2020. Individuals will not be able to receive more than one of the CERB, CEWS and/or EI benefits. If you have already applied for Employment Insurance (EI), you will not need to apply for the CERB benefit. Individuals will need to apply online with CRA’s My Account or by telephone. The individual themselves must submit the application, a representative cannot apply for them.
CERB Qualification Criteria
- The Benefit is only available to individuals who stopped work and are not earning employment or self-employment income as a result of reasons related to COVID-19. Individuals who have not stopped working because of COVID-19 are not eligible for the Benefit.
- The CERB is available to Individuals who:
- Reside in Canada, who are at least 15 years old;
- who have stopped working because of COVID-19 or are eligible for Employment Insurance regular or sickness benefits;
- who had income of at least $5,000* in 2019 or in the 12 months prior to the date of their application; and
- who are or expect to be without employment or self-employment income for at least 14 consecutive days in the initial four-week period.
*The income of at least $5,000 may be from any or a combination of the following sources: employment; self-employment; maternity and parental benefits under the Employment Insurance program. This does not include dividends from private corporations. We are hoping that the government will change it’s position on private dividends being included as “income” but we have no certainty that this will be changed.
- The application will be open on April 6, 2020 through canada.ca
- The application will work on a system ordered by birth date. People born in January through March can apply on April 6, those born in April through June on April 7, those born in July through September on April 8, and those born October through December on April 9.
- Individuals will not be able to receive more than one of the CERB, CEWS, and/or EI benefits.
- Monthly confirmation check-ins (through canada.ca) will be required to remain eligible.
- The benefit will be paid out in weekly payments of $500.
- Individuals that have registered for EI will not be required register again for the CERB
- Direct deposit payment will be received 3-5 days after the application has been processed, or 10 days if received by mail
There are two ways to apply:
- Online with CRA My Account
- Over the phone with an automated phone service (1-800-959-2019)
Click here for more details on the application process.
Individuals can also use their BC Service Card to login to My Account. Choose Option 3 on this page to register/login
CEWS & CERB: What can you do right now?
- Determine if you qualify for CEWS or CERB
- For CEWS – ensure that your business is set up for direct deposit. If you are unsure if your business number has direct deposit, please contact us for assistance.
- For CERB – ensure you have access to CRA’s My Account. Unfortunately, Provision CPA cannot apply for these benefits on your behalf. Please follow the directions above to create an account.
- Discuss the benefits of the CEWS and CERB with your relationship manager at Provision to determine what is best for your business and individual needs.
BC Individuals: Deadline to File Vacancy Tax Declaration
Please note that the deadline to file the Vacancy tax declaration has not been extended. The due date for this is tomorrow March 31st, 2020. If you own property in Vancouver, you’ll receive a letter for the speculation and vacancy tax, which is separate from Vancouver’s empty homes tax. You must declare for both taxes. The letter from the BC government should have a Declaration Code and Letter ID that is need to file the declaration online.
Sign up for a Service Canada Account and CRA MyAccount
Please make sure you have signed up for a Service Canada and CRA MyAccount so that once the benefits are available, you will have the login credentials ready ahead of time. This is also to avoid signing up for an account during a time where crowds and high visitor traffic my cause the website to crash.
COVID-19 BC Action Plan: Benefits, Credits, and Deferrals
New BC Emergency Benefit for Workers. This will provide a tax-free $1,000 payment to British Columbians whose ability to work has been affected by COVID-19. The benefit will be a one-time payment for B.C. residents who receive federal Employment Insurance (EI), or the new federal Emergency Care Benefit, or the new federal Emergency Support Benefit.
B.C. Climate Action Tax Credit. The Province is increasing and expanding the BC Climate Action Tax Credit in July 2020. Eligible families of four will receive up to $564 and eligible individuals will receive up to $218 in an enhanced payment. This boosts the regular Climate Action Tax Credit payment of up to $112.50 per family of four and up to $43.50 per adult.
BC Hydro’s Customer Crisis Fund. Customers of BC Hydro now have the option to defer bill payments or arrange for flexible payment plans with no penalty. Customers who are dealing with job loss, illness or loss of wages due to COVID-19 will be able to use BC Hydro’s Customer Crisis Fund grant program for up to $600 to pay bills.
ICBC. Customers of ICBC on a monthly Autoplan payment plan, who are facing financial challenges due to COVID-19 may defer their payment for up to 90 days with no penalty. Payment deferral is also available for fleets. If you are approaching your deferral payment due date and you do not want this payment withdrawn on that date, please call ICBC at 604-661-2723 or 1-800-665-6442 to discuss payment options. Please note that their call volumes are high during this time.
In these unprecedented times, we understand that there is a lot of information to disseminate.
We at Provision are here to help you in any way we can. Feel free to reach out directly to your contact at Provision for more details and clarifications.
604-273-6601 ext. 109
604-273-6601 ext. 112
604-273-6601 ext. 104
604-273-6601 ext. 105