There is Help and Hope for Small Business
The outlook for small business seems bleak right now. The implementation of self-isolation and social distancing to limit the spread of COVID-19 started affecting businesses with fewer customers in our stores or clients in our chairs.
With the resolution last week to close all businesses except for essential services, the tough situation got exponentially worse. Small businesses—in fact all businesses—are facing some of the toughest choices they’ve ever had to make. Whether to lay staff off, reduce work hours, cut hourly wages, or even whether to shut their doors permanently.
We are fortunate as Canadians to have had our government step up to offer temporary supports for businesses that can provide immediate relief to owners and entrepreneurs who are not earning an income as a result of COVID-19, or wage subsidy to keep employees working, financing and credit insurance, and deferred tax payments until businesses recover. Please note that changes to the benefits are happening regularly, but here is what we know now… Let’s breakdown the benefits.
The Canada Emergency Response Benefit (CERB) will provide $2,000 a month for up to four months to help business owners and workers who are not receiving a paycheque, quarantined or sick with COVID-19, or taking care of a family member infected by the virus. Expect the application for this benefit to be available by April 6 both online through the CRA website or by calling a toll-free number not yet shared. The estimated turnaround time to receive benefits is a quick three to 10 days, depending on direct deposit or mailed cheque service.
Next is the temporary wage subsidy with benefits expected to last for three months. The government just announced that the subsidy will be 75 per cent for all businesses, and not just for small and medium-sized ones. The subsidy will carry a backdate to March 15, 2020. To learn more about the benefit, click here.
The government is also guaranteeing small businesses one-year interest-free bank loans of up to $40,000. Prime minister Trudeau said that up to a quarter of the loan could be non-repayable under certain conditions, although the conditions were unavailable at the time of the announcement. For more information about the Business Credit Availability Program (BCAP), follow this link.
Lastly, businesses can also see some relief in the form of deferred tax payments, which will now be due by August 31, 2020. Of note is that HST remittances don’t fall under this benefit and are still due on time. Click on this link to learn about deferred tax payments and click here to learn about GST/HST due dates.
So before you decide to call it quits with your small business, be sure to review all of the options and relief benefits that can help you ride out the pandemic and provide you with some security while we all wait for things to get back to a new normal. And most importantly, stay safe and healthy, so you can get your small business back on its feet when the time comes.