The pandemic has wreaked havoc on small businesses, leaving many of you to look for financial support. Here, you’ll find more information about government aid programs, so you can get the help you need.
Most recent update:
March 3, 2022, government launches the Canada Digital Adoption Program to allow businesses to apply for grants and loans to support digital transformation needs such as digital adoption plan and grants.
January 12, 2022, government announces the extension of the CEBA repayment deadline and interest-free period to December 31st, 2023. This new deadline also applies to the CEBA-equivalent loans offered through the RDAs (i.e., RRRF).
On December 22, 2021, government temporarily expanded the lockdown supports from December 19, 2021, to February 12, 2022, in the following ways:
See our chart to learn what you need to know about the changes to the COVID support programs.
As more details are available, we’ll update our website with the most accurate, recent information.
Important Financial Support Programs
To help pay for wages
To help pay for costs
To help with income support
Frequently Asked Questions
If you missed the application deadline because of CRA or made a mistake in your application (giving you a lower CEWS/CERS amount), you can now amend or submit a late application within 30 days from the later of April 21, 2021, or the applicable filing deadline. This includes errors or mistakes with your application for CEWS periods 1-5. To find out if this applies to you call the CRA Business Enquiries line at 1-800-959-5525.
There are no deadlines if you are returning money to the CRA. If you need additional CRA information or assistance, please contact the CRA Business Enquiries Line directly at 1-800-959-5525.
Yes, there are other programs available depending on your sector and the type of work the student will be performing:
Other programs can be found by using the government’s Business Benefit Finder and filtering your search to “hire and train employees” on the filter bar on the right-hand side of the page.
No taxes have been deferred at this point. All taxes are still due at the prescribed times. CFIB is pushing for some tax deferrals and/or leniency around tax deadlines.
CEBA & RRRF - only the forgivable portion of the loan is taxable, and it is taxable in the year that CEBA/RRRF or the CEBA/RRRF expansion loan is received. The rest of the loan you received through CEBA/RRRF is considered a repayable loan and does not need to be included in your revenue.
If you must repay the forgivable portion of the CEBA/RRRF loan in a subsequent taxation year, you may be able to claim a deduction when calculating your income for that subsequent year (i.e., the year you repay the forgivable portion).
You can claim the deduction even if you had previously filed to reduce the income inclusion in the year that you received the CEBA/RRRF loan.
CEWS and CERS - must be included immediately before the end of the qualifying period to which they relate, not when the funds are received. This means that a subsidy received for the 4 weeks ending October 24, 2020, is included as income on October 24, 2020, even if you have not yet received the subsidy from government.
Provincial Grants e.g., the Ontario Small Business Support Grant and the NB Small Business Recovery Grants – are taxable income when received (hits the account) and should be reported on the corporation’s tax return as a grant/subsidy.
Temporary Wage Subsidy - must be reported using the PD27 form. The total subsidy you received must be reported as income on your tax return for the year you reduced your remittances.
Should you have any questions or concerns, please consult your accountant for any tax advice.
If a business does not want to claim the forgivable portion of the loan as income, they can instead elect to reduce the amount of expenses they claim when filing their taxes for the year in which the forgivable portion was received.
If the forgivable portion of a CEBA loan is included in income when received but is subsequently repaid pursuant to a legal obligation to repay the amount, it may be possible to claim a deduction in the year in which the repayment of the forgivable portion is made.
The principal amount of the CEBA loan in this example is $60,000 and the taxpayer included the forgivable portion of the CEBA loan of $20,000, in their income in the year ending December 31, 2020. The taxation year of the taxpayer is December 31st. The taxpayer makes no repayment of the CEBA loan on or before December 31, 2022, and repays the entire CEBA loan of $60,000 on December 31, 2025. The taxpayer is entitled to a deduction of the forgivable portion of the CEBA loan that was previously included in income. In this example, the repayment of the full principal amount of the CEBA loan is made on December 31, 2025. Therefore, a deduction of $20,000 is available to the taxpayer in the 2025 taxation year.
Should you have any questions or concerns, please consult your accountant for any tax advice.
CRA uses a range of data to determine which tax returns are at a high-risk of non-compliance. Once a return is identified as high risk, CRA reviews information from various sources to determine whether an audit is required, for example:
- Tax-payer's filing
- Third-party information
- Facts on emerging and known areas of non-compliance
Due to COVID-19, CRA has adjusted their thresholds and will only audit those who have the highest risk of non-compliance.
The focus of an audit is determined by the risk issues identified when the file was selected for audit. The auditor will review various documents, which could include:
- Business records (e.g., ledgers, journals, invoices, receipts, contracts, bank statements)
- Personal records of the business owner (e.g., bank statements for personal accounts, mortgage documents, credit card statements)
- Personal or business records of other individuals/entities related to the business owner (e.g., spouse, family members, corporations, partnerships, trusts)
The CRA may also ask for input from the business’s accountant, bookkeeper, and/or employees about information that relates to the books, records, and what was reported in the tax returns.
The best way to prepare for an audit is to ensure proper documentation is maintained and made available to support the amounts reported on your tax returns.
Auditors will work to hold meetings virtually or by secure telephone channels to mitigate the risks associated with COVID-19. It is recommended that businesses sign up for the various CRA portals (My Business Account, My Account, Represent a Client) so they can securely and efficiently submit required documents electronically, and ensure a timely resolution of the audit.
Employees and self-employed persons must meet different conditions under the Income Tax Act to claim a deduction for home office expenses from their employment or business income. Since home office expenses can only be deducted from the income (employment or business) to which they relate, and not from any other income, the claims for an individual earning both employment income and business (self-employment) income must be made separately. In addition, if the individual is using the same workspace, they will need to allocate their work-space-in-the-home-expenses on a reasonable basis between employment and business use.
Further, under the Income Tax Act, an individual is generally not allowed to deduct the same amount from both employment and business income. For example, an individual cannot deduct the total cost of office supplies purchased from both their employment and business income.
Example: if you buy $100 of office supplies, you cannot deduct that amount from both your employment income and your self-employment income. The amount must be deducted from the revenue it helped generate or must be pro-rated if the supplies were used for both employment and self-employment purposes.
For information concerning home office expenses for self-employed persons, go to the Business-use-of-home expenses webpage.
There are three possible options:
- The employee can claim $2 for every day they worked from home up to a maximum of $400 for the year on their taxes. There is no obligation for the employer to do anything when this option is chosen. The employee must have worked at least 50% of the time from home for a period of at least 4 consecutive weeks.
More information on the simplified method can be found on the government website.
- The employee may want to claim more as they incurred expenses exceeding $400. If they are only claiming amounts paid as a result of working from home, they can use the simplified form - T777S to file their claim. They will require their employer to provide them with a completed T2200S (Declaration of Conditions of Employment for working at home due to COVID-19) which only has 3 questions for you to answer confirming that they were required to work from home.
- If the employee is claiming other employment expenses (e.g., motor vehicle) or parts of the home as expenses, they will have to use the long form process. For the employee that would be the Statement of Employment Expenses T777. As their employer, you would be required to provide them with the completed Declaration of Conditions of Employment T2200.
As per the CRA, Employment income is the number that you would find in box 14 of an individual’s T4 Slip. This includes:
- Salary, wages (including pay in lieu of termination notice), tips or gratuities, bonuses, vacation pay, employment commissions, gross and insurable earnings of self-employed fishers, and all other remuneration (see Box 14 – Employment income for a detailed list) you paid to employees during the year
- Various taxable benefits or allowances
- Retiring allowances
- Deductions you withheld during the year
- Pension adjustment (PA) amounts for employees who accrued a benefit for the year under your registered pension plan (RPP) or deferred profit-sharing plan (DPSP)
What is CFIB advocating for?
What we have achieved
Thanks to our members’ feedback, we have successfully pushed for the government’s aid to be expanded and extended, especially CEWS, CERS and CEBA. Find out more about our many victories for small business.
What we’re pushing for
The federal financial supports have improved, but there are still many gaps in the relief they provide. Here’s what we’re still pushing government to do to provide more and better support.
How you can help
We’ve pushed the government to make some progress, but we're still fighting for better relief measures. Add your voice today.
Our primary concern at CFIB is making sure you have the support you need to get through this uncertain and challenging time. We provide you with expert advice and ensure that you have all of the latest information on government announcements and available support.