Everything To Know About COVID-19 Canada Emergency Wage Subsidy
Everything you need to know about the Canada Emergency Wage Subsidy designed to alleviate the financial pressures caused by the COVID-19 physical distancing and quarantine requirements.
The Canadian national response to COVID-19 is essentially a precarious balancing act. Until we have a cure, the main angle of protection is self-isolation to flatten the curve. One of the big problems, however, is that ours is largely a society built on the dignity of labor. We work to put food on the table and a roof over our heads. The response to this virus puts all that in jeopardy.
We need many business owners to close or drastically reduce traffic, even if doing so is against their financial interests. We need many workers to choose to stay home, even if they have no way to financially provide for those they love. Accordingly, one of the most important measures passed by the Canadian government specifically addresses wages. The idea was to help people comply with the requirements of staying at home without suffering too much financial hardship.
Here are a few things you should know about the subsidy.
Quick Guide To The Canada Emergency Wage Subsidy In Response To COVID-19
What Is It
The Canadian Emergency Wage Subsidy is one of several initiatives enacted by the Canadian government to help its residents during the COVID-19 pandemic. The program provides financial assistance to certain businesses so they can survive and keep critical employees. This move was necessary to help businesses suffering from a sudden drop in revenue to avoid laying off workers and potentially rehire those already separated.
Who Is Eligible
The subsidy is available to any employer that experienced at least a 30% reduction in revenues due to COVID-19. All employers outside the public domain are eligible. Public domain includes local governments, public schools, colleges, hospitals, and crown corporations.
Included in the subsidy are taxable corporations, nonprofit organizations, individuals, and charities.
Demonstrating The Revenue Drop
Part of the application process includes demonstrating the 30% drop in revenue. The employer would need to provide monthly revenues for 2019 and demonstrate a current 2020 monthly revenue of at least 30% lower than the numbers last year. Eligibility is broken down into three periods between March 15th and June 6th. If your business saw a drop in only one of those periods, you may still be eligible for assistance for that period.
Current revenue does not include any funds received as part of the COVID-19 Economic Response Plan, but receiving other forms of aid may impact the subsidy amount.
What It Pays
The subsidy is relevant to any salaries or wages paid to employees between March 15th and June 6, 2020. It will cover up to 75% of wages paid, up to a maximum amount of $847 dollars per week. Payments in the form of severance, stock options, or personal use of company assets are not covered.
How To Apply
While details are not finalized, business owners will apply for the Canada Emergency Wage Subsidy through their existing Canada Revenue Agency My Business Account interface. Further details will be made available soon, but employers should begin collecting revenue and salary information now.
For More Information And Other Options
The Canadian response to COVID-19 is an ongoing effort, and residents are encouraged to watch canada.ca for further information. For more information on the Canada COVID-19 Economic Response Plan specifically, visit https://www.canada.ca/en/department-finance/economic-response-plan.html. Together, we will keep Canada healthy and moving forward!