On March 13, 2020, Minister of Finance Bill Morneau, Governor of the Bank of Canada Stephen Poloz, and Superintendent of Financial Institutions Jeremy Rudin outlined a coordinated package of measures to support the functioning of markets, the resilience of our financial sector, and continued access to financing for Canadian businesses”
The rippling effect of COVID-19 has affected everyone and everything including families, business owners and the economy itself. For business owners who are facing financial hardships, the governing body has ensured there is support. The government and its partners have worked together to initiate measures to help stabilize the Canadian economy through this challenging time.
Due to the fact that businesses are at the forefront of direct and indirect revenue losses, the government is prepared to support employers by offering a wage subsidy for a duration of three months. For small business owners, the government is providing a wage subsidy of $1,375 per employee and $25,000 per employer. “Businesses will be able to benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration.”
“The Canada Revenue Agency will allow all businesses to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020. This relief would apply to tax balances due, as well as installments, under Part I of the Income Tax Act. No interest or penalties will accumulate on these amounts during this period.
The Canada Revenue Agency will not contact any small or medium (SME) businesses to initiate any post-assessment GST/HST or Income Tax audits for the next four weeks. For the vast majority of businesses, the Canada Revenue Agency will temporarily suspend audit interaction with taxpayers and representatives.
The Liaison Officer service offers help to owners of small businesses to understand their tax obligations. Traditionally available in-person, this service is now available over the phone and will be customizing information during these challenging times by ensuring small businesses are aware of any changes such as filing and payment deadlines, proactive relief measures, etc.”
(Department of Finance Canada, 03.18.20)
During this economically stressful time, there are some businesses & firms that are struggling to keep the lights on. The government has put measures into place to make it easier for employers to borrow. The Business Credit Availability Program (BCAP) will allow more than 10$ million of additional support to target small and medium-sized businesses in any case of emergency. As a result of the decrease in the Domestic Stability buffer by 1.25%, there will be $300 billion of additional lending money.
We ask ourselves, are the CRA Subsidies enough for law firms? We are in the beginning stages of a new legislation. If your law firm has any questions or concerns please schedule a call with Jacques Tjonasan, President