As have many of you, we have been waiting patiently, in anticipation, for the announcement of details of the wage subsidy from the Canada’s Federal Government. At his daily address to the Nation, the Prime Minister was vague, however, the Finance Minister provided a few more pieces of information this afternoon.
Here is what we know:
Canada Emergency Wage Subsidy
The Canada Emergency Wage Subsidy (“CEWS”) will subsidize 75 per cent of wages for qualifying businesses up to a period of three months. It will be retroactive to March 15 and will cover the first $58,700 of salary up to a maximum of $847 per week.
In order to qualify for the CEWS, business owners that apply will have to show their revenue fell at least 30 per cent compared to the same month last year. Updated Wednesday, April 8 at 1 pm ATL: An announcement by Justin Trudeau states that the qualifications for the subsidy will be a 15% decrease in revenue in March 2020 as compared to January 2020 and February 2020. This has not been enacted and is subject to change.
The funds under the CEWS will be sent to businesses via Canada Revenue Agency.
These funds will not be available for at least 6 weeks….
Business owners are encouraged to pay the remaining 25% of the wages of the employees, however will not be penalized if they cannot pay the remaining 25%.
For businesses that do not qualify for the CEWS, the originally announced program is still available. The original program included the following assistance:
A 10% wage subsidy on wages paid from March 18 to June 19, with a maximum of $1,375 per employee and to a maximum of $25,000 per business. When originally announced , this program would have businesses reduce their payroll remittances to recover the wage subsidy.
We have a lot of questions for clarification of these programs but we wanted to share what we know at this point. We will be reaching out to our clients on a one on one basis and we encourage anyone reading this to reach out to their professional service provider. We are available for answering questions and guiding folks through this process.
Until next time,
Jason