As many of you have heard and read, a series of economic measures to help protect the economy from the damage caused by COVID-19 have been released. Included in the Government’s package is a set of tax measures designed to provide immediate relief to businesses and individuals that may be facing hardship during this difficult time. We know that many of you have questions on how to apply or even if you qualify for any of these items. Below is a summary and link to help you:
Canada’s Covid-19 Economic Response Plan
This is the link to be able to access all information
Tax filing deadlines for all
Individuals – an individual’s tax filing deadline for the 2019 taxation year is postponed to June 1, 2020. Self-employed individual returns are still due as of June 15,2020.
Corporations – corporation with year ends of September 30, 2020, October 31, 2020 and November 30, 2020 have been postponed to June 1, 2020.
Trusts – the filing deadline for a trust with a December 31, 2019 year-end is postponed to May 1, 2020. There has been no mention of any extensions for testamentary trusts with off-calendar year ends.
Partnerships – filing deadline for T5013s for the 2019 year is postponed to May 1, 2020.
Individual Tax Payments & Installments
CRA is allowing individuals to defer making income tax payments until September 1, 2020, for tax payments that became due after March 18, 2020. Deferred payments will not incur interest or penalties. This relief applies to tax balances due as well as June 15th installment payments.
Corporate Tax Payments & Installments
CRA is allowing corporations to defer making income tax payments until September 1, 2020, for tax payments that became due after March 18, 2020 and before September 1, 2020. Deferred payments will not incur interest or penalties. This relief applies to tax balances due as well as installment payments.
Sales Tax Remittance (GST/HST) Payments and Installments
Businesses, including self-employed individuals, who owe GST/HST for the following filing periods can defer making payments until June 30, 2020:
- Monthly filers for February, March and April 2020
- Quarterly filer for January 1 to March 31, 2020
- Annual filer for January 1, 2019 to December 31, 2019
- Installments for 2020 (April 30th installment)
Financial Support (Loans, Mortgage Support)
For all these items (you can read about in the main link provided at the top) you should contact your financial institution to determine whether any of the programs you qualify for.
Canada Emergency Wage Subsidy (CEWS)
- 75% wage subsidy starting for a 12-week period from March 15, 2020 to June 6, 2020
- Canadian businesses (individuals, corporations, partnerships, non-profit, charities) whose revenues have decreased by at least 30% for March, April & May when compared to the same month in 2019.
- Subsidy will be on the first $58,700 earned by an employee, which can result in an amount up to $847/week ($58,700*75%/52 weeks) – this is the maximum.
- This is not a reduction of payroll remittances, this is a “rebate” that you will apply for in the coming month.
The Canada Emergency Wage Subsidy will be accessible through CRA’s My Business Account portal, as well as an online application in 3 to 6 weeks.
Wage Subsidy (Payroll Remittance Reduction)
Canadian businesses that do not qualify for the CEWS above (revenue did not decrease by at least 30%) can continue with the 10% payroll remittance reduction on remuneration paid from March 18, 2020 to June 20, 2020, up to a maximum of $1,375 per employee and $25,000 per employer (maximum 18 employees).
Businesses that are eligible for both the CEWS and Wage Subsidy can take the 10% payroll remittance reduction but when applying for the CEWS it will be reduced.
- This applies for April 15, May 15 and June 15 payroll remittances
- You cannot reduce the CPP or EI remittance amounts.
Canada Emergency Response Benefit (CERB)
This benefit will cover Canadians who have lost their job, are sick, quarantined, or taking care of someone who is sick with COVID-19, as well as working parents who must stay home without pay to care for children due to school and daycare closures. This benefit will apply to wage earners, contract workers and self-employed individuals who would not otherwise be eligible for Employment Insurance (EI).
The Canada Emergency Response Benefit will be accessible through a secure web portal starting April 6th. Applicants will also be able to apply via an automated telephone line or via a toll-free number.
One-time special payment of an average of $400 for single individuals and close to $600 for couples will be provided in early May
No need to apply for this, if you are eligible you will automatically get it.
Increase to Canada Child benefit (CCB)
An extra $300 per child will be delivered as part of the scheduled CCB payment in May.
Those who already received the Canada child Benefit do not need to re-apply.
Registered retirement income funds (RRIFs)
Minimum withdrawals from RRIF’s for 2020 will decrease by 25%.
DNTW TORONTO LLP
CHARTERED PROFESSIONAL ACCOUNTANTS