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We’ve had team members working from Alberta for a few years already, but now we can officially announce that James & McIntyre CPAs LLP has an office in Calgary.
Do you own residential real estate? Understand your UHT filing obligations
The COVID-19 Canada Emergency Wage Subsidy and Temporary Employer Wage Subsidy: What they are and how to claim them.
[updated end of day April 8, 2020]
The government first announced a temporary 10% wage subsidy which would come in the form of an immediate reduction in payroll remittances for most small to medium businesses. That program is still going forward, and now there is a new (separate) subsidy program which provides up to a 75% wage subsidy for businesses that have seen a decline in revenue starting March 2020 due to COVID-19 (details below). You can claim both subsidies, but the maximum you can get is a 75% wage subsidy so if you qualify for that but receive the 10% subsidy, it will reduce your 75% amount coming back. Here are the details on how to claim these:
10% Wage Subsidy
Qualification criteria: you need to be an employer in Canada and have an existing payroll account with CRA on March 18, 2020
Amount of subsidy: 10% of gross wages paid your employees up to a max of $1,375 per employee or $25,000 total per employer
How you claim it: you need to manually calculate the subsidy and reduce your payroll remittances by the 10%. There is no application process or reporting needed - you simply calculate and remit less.
Example using random numbers:
You paid employees $10,000 of wages in total on or after March 18th.
You withheld $3,500 of income taxes on those amounts, plus CPP and EI. Instead of remitting the $3,500 as you normally would, you would remit $2,500 ($3,500 less 10% of $10,000) plus your CPP and EI as you normally would.Subsidies for non-arm’s length employees (ie. business owners and their family members) will need to be calculated on their normal pre-COVID earnings. In other words, you can’t increase your pay to get more subsidy.
More details and FAQ from the CRA here: https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html
75% Wage Subsidy
Qualification criteria: you need to be an employer in Canada and have experienced a drop in revenues of 15% or more due to COVID-19 in March 2020, and 30% or more in the following months. This is considered on a month-by-month basis, and is compared to either the same month of the previous year, or an average of January & February 2020 revenues.
Amount of subsidy: 75% of gross wages paid your employees from March 15th 2020 onward, up to a max of $847 per week per employee. There is no cap on the total per employer, and wages paid to new employees hired and paid would be eligible under this program as well.
Subsidies for non-arm’s length employees (ie. business owners and their family members) will need to be calculated on their normal pre-COVID earnings. In other words, you can’t increase your pay to get more subsidy.
How you claim it: via your My Business Account on CRA’s website. You will receive the reimbursement by direct deposit if you are signed up, and it may take up to 6 weeks. As of this date, applications are not yet open but are coming soon so we expect to have more details when they do.
More details from the CRA here: https://www.canada.ca/en/department-finance/economic-response-plan/wage-subsidy.html
Can I claim both?The short answer is YES. But you’ll only receive a maximum of 75% subsidy, so if you reduce your payroll remittances by the 10% subsidy and then claim the 75% subsidy later, you’ll only get up to 65% (bringing you to 75% in total).
COVID-19 Tax Measures: Here's what you need to know
Some of the key highlights, in brief:
Tax Deadlines Extended
Filing deadline for personal taxes extended to June 1, 2020
Payment deadlines for tax due have been extended as well:
Personal tax due: extended to August 31, 2020
Corporate tax due: extended to August 31, 2020
Tax Incentives & Special Measures
Most audits are paused for the next 4 weeks for small and medium businesses. No new ones will be initiated.
Temporary business wage subsidy: effective immediately, this is a reduction of payroll remittances of 10% of total wages paid over the next 3 months, up to a maximum of $1375 per employee and $25,000 per employer.
Emergency care benefit: up to $900 every two weeks, for up to 15 weeks for those who do not have paid sick leave and do not qualify for EI sickness benefits. You'll be able to apply for this starting in April; more details yet to come.
See our newsletter below for more information.
