Canada Emergency Wage Subsidy Extension
Dear Valued Clients and Friends,
Hope you and your families are staying safe and well.
Today, our Prime Minister announced that the Canada Emergency Wage Subsidy (CEWS) will be extended to December 2020. Details such as specific dates and eligibility criteria have not been publicized yet.
On April 11, 2020, legislation was passed to implement this program which was introduced to provide eligible employers with amounts equal to 75% of their employees’ remuneration paid, up to a maximum of $847 per week, per employee, retroactive from March 15, 2020. The federal budget for CEWS sits at $80 Billion.
Previously, the CEWS program was set to expire on June 6, 2020, and a further extension was approved for eligibility until August 29, 2020. Now, qualifying companies and non-profit organizations will have until December 2020 to receive financial assistance to handle the impact of COVID-19 on their businesses.
Applications for Claim Period 4 (June 7, 2020 to July 4, 2020) are open as of July 8, 2020. Thus far, eligibility for previous periods have required a minimum of 15% to 30% year-over-year revenue reduction within a four-week period. The same eligibility criteria will still apply for the current Claim Period 4.
Any potential changes would commence as of Claim Period 5 (July 5, 2020 to August 1, 2020) and/or Claim Period 6 (August 2, 2020 to August 29, 2020), and all following Claim Periods up to December 2020.
We will provide further updates once we hear more about the CEWS extension.
REMINDERS REGARDING INCORRECT OR FRAUDULENT CLAIMS
If you do not meet the Canada Emergency Wage Subsidy eligibility requirements for a period, you will be required to repay any amounts you received for that period.
If you artificially reduce your revenue for the purpose of claiming the wage subsidy, you will be required to repay any subsidy amounts you received, plus a penalty equal to 25% of the total value.
If you produce and submit a fraudulent claim, penalties of 225% may apply, including fines or even imprisonment.
This newsletter and the details provided are solely shared for informational purposes and does not constitute legal, tax, or financial advice or opinions. Please do not hesitate to contact your manager for assistance.
Pramen Prasad CPA, CA, CMA Managing Partner
Prasad & Company LLP
If you have any questions, you can reach us at:
(416) 226-9840 or
1 (888) 550-8227