All 13 of Canada’s Premiers join our fight in calling on Ottawa for a full one-year extension to the CEBA loan forgivable deadline. Read our statement in response.
CEBA UPDATE FROM CFIB PRESIDENT
As you already know, the Federal Fall Economic Statement was released on Tuesday and it did not include action on the CEBA forgivable deadline. This was one of the last major opportunities to change gears before the January 18th deadline.
CFIB was very disappointed that government ignored this window to take action on this critical file. Many members (and small business owners more generally) are looking to CFIB for advice on whether there is still hope for a change in direction or if they should do everything in their power to repay the loan now.
My advice to business owners is the following:
- Prepare to repay on/before January 18th if you possibly can: At this stage, a further extension is unlikely and those businesses that have the capacity to repay should be prepared to do so in advance of the January 18th deadline. To avoid losing the forgivable portion of the loan, ensure you know how you will repay your financial institution by that date.
- If you are looking to borrow to repay your CEBA loan, ensure you have documentation of your application before January 18 to qualify for a special extension to March 28, 2024: The government has created a special provision for businesses that make a refinancing application with the financial institution that provided their CEBA loan by January 18, 2024. The repayment deadline to qualify for partial loan forgiveness now includes a refinancing extension until March 28, 2024. CFIB is seeking clarification of what documentation will be accepted as proof for this extension.
- If you don’t have the capacity to repay or borrow to repay your loan, consider how you will repay the larger amount over the next 3 years: While CFIB believes it is still deeply unfair that businesses will lose the forgivable portion of the loan if not repaid by early next year, the government did make other changes. If you haven’t repaid the balance by January 18, you will lose the forgivable portion, but the balance can be repaid over 3 years (to the end of 2026) subject to interest of 5% per annum. In addition, businesses will only be required to pay monthly interest payments and can pay the principal amount just before the term loan repayment deadline of December 31, 2026.
- Keep up the fight for an extension until the final deadline: While businesses need to be fully prepared, CFIB will continue to fight for an extension until the very last minute. Sadly, Ottawa often makes policy changes at the 11th hour. In fact, just a few weeks ago, Ottawa changed gears on documentation requirements for the Underused Housing Tax on the day before the new rules were to kick in. CFIB has collected over 55,000 signatures on our petition, kept CEBA in the news for months and gathered the support of three out of the five federal parties and all 13 of Canada’s Premiers. Please keep calling your MP to ensure they know an extension remains important to you.
I wish I had better news to share on this key file. And while our fight will continue, businesses need to be fully prepared for no further changes from Ottawa.
In addition to CEBA, CFIB has many other critical files at the moment, including the fight for fairness for small businesses with the carbon tax, and the need to proceed quickly with the recently announced reduction in credit card fees, among several other issues.
Thanks for your ongoing support!
Dan Kelly
President and CEO
UPDATE & RECOMMENDATIONS FROM CFIB PRESIDENT RE: RECENT CEBA CHANGES
As you know, the entire CFIB team has been working hard to push back the date at which point small businesses lose the forgivable portion of CEBA (up to $20,000).
After months of lobbying, dozens of meetings with MPs, and over 40,000 signed petitions from small business owners we have delivered to government since the start of 2023, the government announced changes to the CEBA repayment process on September 14, 2023.
The Prime Minister himself announced that CEBA loans would be extended by one year. Journalists, small business owners and even Liberal MPs all believed this meant that small business owners would have an extra year to repay $40,000 on their CEBA loan in order to keep the $20,000 forgivable portion.
But sadly, this isn’t true at all.
The confusion is that there are 2 CEBA deadlines. The first is the December 31, 2023 deadline to repay in order to keep the forgivable portion. That deadline was extended—but only by 18 days – to January 18, 2024.
The extra year is for those who miss out on the forgivable portion – they now have 3 years rather than 2 to pay back the full $60,000 CEBA loan (by the end of 2026). While this will be helpful for some, it is not the deadline small businesses were worried about.
Since this announcement, I’ve heard from hundreds of small business owners who feel that the government deliberately misled them on what was changing and that the change that was made misses the mark entirely.
Business owners have every right to be angry about how the government is treating them. The government is now telling business owners that they should simply convert their CEBA loan to a regular bank loan in order to secure the forgivable portion. In fact, the government has created a special provision allowing those who apply for a bank loan to repay CEBA before January 18 to have until March 28 to convert their loans in order to keep the forgivable portion. This is essentially like government telling a family struggling to pay their Visa bill to simply apply for a Mastercard.
Instead of two CEBA deadlines, we now have three. Here is a summary of these new dates.
| Previous Plan | Current Plan | |
|---|---|---|
| Deadline to keep the forgivable portion (up to $20K) by repaying the balance (up to $40K). | Dec. 31, 2023 | Jan. 18, 2024 |
| Deadline to keep the forgivable portion if you have an application in process before Jan. 18, 2024 for a bank loan to repay CEBA. | --- | Mar. 28, 2024 |
| Deadline to repay the entire CEBA loan (up to $60K) if you miss the forgivable deadlines. | Dec. 31, 2025 | Dec. 31, 2026 |
So where do we go from here?
First, despite the incredibly short time frame, CFIB will continue our campaign for further changes to the deadlines. Now that the government has pushed the forgivable deadline to January 18, 2024, we are calling on them to further move it to December 31, 2024 to give small business owners a full extra year to repay the $40,000 while protecting the $20,000 forgivable portion.
This, combined with the other changes they did announce, would make it a package CFIB can support.
But many business owners are asking us for advice on what they should do? Should business owners hold out hope for a further change, or is this the time to try to borrow $40,000 in order to pay the balance to ensure they are able to keep the $20,000 forgivable portion?
My best advice is that 2 strategies are needed:
- I ask you to join the final push for a further change to the repayment deadline. Make sure you sign (or re-sign) the new petition we’ve created to call on government to push the forgivable deadline to December 31, 2024. Share the petition with other business owners. Call your MP right away to let them know the changes are not good enough and a further fix is required.
- Take steps now to be prepared if government doesn’t make any further changes. If you do not have the money to repay up to $40,000 before January 18, 2024, it would be wise to see if your bank will offer you a term loan to allow you to keep the forgivable portion. In most cases, if you are able to get a term loan, it will be less expensive than losing out the $20,000 forgivable portion.
CFIB will do everything we can to get a further delay in the forgivable deadline. But as we can’t be certain that further changes will be made at the 11th hour, we want to ensure small business owners are prepared before January 18th of next year. CFIB is also working on a list of alternative lenders for those who are not able to secure a term loan with their bank.
As always, please feel free to call CFIB’s Business Helpline if our team can be of any assistance along the way.
We haven’t given up and we never go away. Thanks for your ongoing support!
Dan Kelly
President and CEO
Watch CFIB President, Dan Kelly, call for a better CEBA extension and join our fight!
Financing Options
While we caution you against rushing into a loan or financing since we hope to extend the repayment deadline, we have a list of resources to help you find the best option should the need arise.
See all the work CFIB has done so far to help your business with CEBA:
Press Release
Read our latest press release: "CFIB statement on Premiers’ letter calling for a CEBA extension".
Press Release
Read our latest press release: "Not good enough: CFIB statement on CEBA extension".
Joint Letter
Read our joint letter to Deputy Prime Minister Freeland, co-signed by 250+ employer associations across Canada.
CEBA report
Read our report "Small Business Debt and CEBA: Fall Update" on the implications the federal government's CEBA repayment schedule changes could have on business owners.
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