Published on April 3, 2020, on Linkedin

By Mary Ng, Minister of Small Business, Export Promotion and International Trade

Businesses and their employees are feeling an incredible burden from the economic impacts of the COVID-19 pandemic. We are taking immediate action so that Canada’s 1.2 million small and medium-sized businesses are supported through this challenge – and can get back to work fast when we’re on the other side.

1.     Help to keep your employees:

Canada’s small businesses employ more than 8 million Canadians, or nearly 7 of every 10 private-sector jobs. These businesses rely deeply on their human capital – their dependable, hard-working employees who understand the business, have strong relationships with customers, and contribute to the success of the company.

That’s why we are creating the Canada Emergency Wage Subsidy for Canadian businesses of all sizes for three months so they can keep their employees on the payroll. This 75% wage subsidy means that for an employee earning $4,167 per month ($50,000 per year), keeping that employee will only cost business owners $1,041 per month – our government will cover the rest.

It will be retroactive to March 15, and available to businesses and not-for-profit organizations whose revenues have decreased by at least 30% from the same time last year as a result of COVID-19. The subsidy will cover three-quarters of each employee’s salary, up to a maximum of $58,700 per year, no matter how many people the business employs. The portal to apply for this support will be available in the next few weeks.

This wage subsidy is designed to help get the economy back up and running once the pandemic is behind us – as soon as restrictions are lifted and markets start to improve, employees will be able to return to work, and businesses can get back to normal as quickly as possible.

2.     Help to maintain cash flow:

As their revenues decline due to the COVID-19 pandemic, many small businesses and non-profits need a cash injection to pay for rent and other important, ongoing costs. That is why we introduced the Canada Emergency Business Account – a new $25 billion program that will provide small businesses with interest-free loans of up to $40,000 to see them through these extraordinary times.

As with the wage subsidy, these loans will help ensure that businesses can get through this pandemic, and allow them to bounce back quickly.

Businesses with a total 2019 payroll of between $50,000 and $1,000,000 will be eligible for the loans, up to a maximum of $40,000. The loans will be interest-free for the first two years, with an option to extend the repayment schedule for an additional three years with interest. Businesses who repay the balance of the loan before December 31, 2022 will receive loan forgiveness for 25% of the principal amount, up to a maximum of $10,000.

These loans will allow Canada’s small businesses to remain resilient through trying times – not just keep them on their feet, but keep them moving forward.

3.     Help to keep costs low:

Many businesses already find themselves in a cash crunch due to this global challenge. That’s why we are providing two distinct measures to help them maintain a healthier short-term balance sheet.

First, businesses can defer any GST/HST remittances, as well as any customs or duty payments, for the next three months. Thanks to this deferral, GST/HST payments for Q1 2020 – normally due at the end of this month – can be deferred until the end of June. These deferrals will help more than 3.2 million small businesses and self-employed Canadians and is equal to giving them $30 billion in interest-free loans.

Second, we are extending the tax filing deadline until June 1, 2020, and will allow businesses to defer any payments owing until August 31, 2020.

Together, these deferrals will help small businesses maintain a strong balance sheet, and provide them with funds they can tap into as necessary for short-term needs.

4.     Help for the self-employed:

The many Canadians who work on contract or are self-employed are also crucial contributors to Canada’s economy, and we are here to support them.

The Canada Emergency Response Benefit will give $2,000 per month to Canadians who are not receiving a paycheque due to COVID-19. Notably, this benefit will help self-employed people who don’t qualify for Employment Insurance. It is also available to working parents who must stay home without pay to care for their children or loved ones.

This benefit will be paid every four weeks and is available from March 15, 2020, to October 3, 2020. The portal to apply for this will open next week, and those who qualify will begin receiving benefits within 10 days of applying.

Small businesses are at the heart of our communities and a cornerstone of Canada’s economy. These are extraordinary times for all Canadians no matter how they earn their living – if the COVID-19 pandemic has taught us anything so far, it’s that we are all in this together. Our government is determined to do whatever it takes to help small businesses keep their employees, maintain their operations, and stay focused on better times ahead.

You can find more details about our supports for businesses and their employees here: https://www.canada.ca/en/department-finance/economic-response-plan.html