Area of Law: Coronavirus COVID-19
Answer # 7253
Other Federal relief programs for businessesRegion: Ontario Answer # 7253
Temporary 10% Wage Subsidy
The Temporary 10% Wage Subsidy is a three-month measure that allows eligible employers to reduce the amount of payroll deduction required to be remitted to the Canada Revenue Agency (CRA).
You are an eligible employer if you are:
- an individual (excluding trusts),
- a non-profit organization,
- a registered charity, or
- a Canadian-controlled private corporation (including a cooperative corporation) eligible for the small business deduction.
In addition, the employer must:
- have an existing business number and payroll program account with the CRA on March 18, 2020; and
- pay salary, wages, bonuses, or other remuneration to an eligible employee.
Partnerships are only eligible for the subsidy if their members consist exclusively of individuals (excluding trusts), registered charities, or Canadian-controlled private corporations eligible for the small business deduction.
How much does the subsidy pay?
The subsidy is equal to 10% of the remuneration paid from March 18 to June 19, 2020, up to $1,375 for each eligible employee. The maximum total is $25,000 for each eligible employer.
For more information on the Temporary 10% Wage Subsidy, visit canada.ca.
Deferred payment deadlines
Income tax payments
The CRA will allow corporations to defer the payment of any income tax amounts until September 30, 2020 for those amounts that become owing on or after March 18, 2020 and before September 30, 2020. This relief applies to tax balances due, as well as income tax instalments. The government made it clear that no arrears interest or penalties will accumulate on these amounts during this period. Different deadlines may apply for self-employed individuals, trusts, charities, and other business types. Visit canada.ca for more info.
The CRA has also pushed back the remittance deadline for GST/HST remittances. Normally, GST/HST amounts collected by businesses are due by the end of the month following the vendor’s reporting period. For example, if your business is a monthly filer, the GST/HST amounts collected on its February sales are due by the end of March. The CRA has announced that it will extend the remittance deadline until June 30, 2020.
The result is that:
- monthly filers can delay remitting amounts collected for the February, March and April 2020 reporting periods until June 30;
- quarterly filers have until that date to remit amounts collected for the January 1, 2020 through March 31, 2020 reporting period; and
- annual filers, whose GST/HST return or instalments are due in March, April or May 2020, can now remit amounts collected and owing for their previous fiscal year as well as instalments of GST/HST for current fiscal year by June 30, 2020.
In addition, the CRA confirmed it will not be contacting any small or medium sized businesses to initiate any post assessment GST/HST or income tax audits for the next four weeks.
For more detailed and up-to-date information, visit the Government of Canada Economic Response Plan website.
Provincial relief programs for businesses
There may also be financial relief programs and incentives for businesses available from provincial governments. For more info, visit our related links and resources for what is available where you live.
Get help from a life insurance advisor
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