DA Levinson & Associates is doing our part to limit the potential spread of COVID-19.
Our office will continue to be closed to the public
- A drop box is located outside our office door Unit #301
- Please leave your documents in the drop box-All documentation received will be packaged and sealed for 2 days prior to us checking in and assigning the work
COVID-19 announcements: APRIL 3-2020
CRA “My Account”:
It is critical that all clients ensure that they have their “My Account” set up with CRA immediately, as this will become the conduit for receiving subsidies from the Government of Canada. The instructions to do so are as follows: https://www.canada.ca/en/revenue-agency/services/e-services/e-services-individuals/account-individuals.html
How we are handling 2019 Tax Processing during COVID-19:
Personal tax processing continues during this time, however processes and workflow are much slower due to staff working remotely on file and the scanning and sharing of documents. We will continue to work through the backlog and get the documents to you for electronic signing as quickly as possible. We are using a new system(to us) called docusign in order to facilitate the sign off process. All follow up meetings will be done by appointment by phone or by gotomeeting video conferencing software. When you receive your return, please schedule a meeting if you have questions and wish to be walked through the return.
Due date for individual tax returns: June 1,2020
Tax to be paid by: Sep 1 2020 (without penalty and interest)
File your income tax and benefit return electronically before June 1, 2020 to make sure your benefits and credits are not interrupted.
CERB- Canada Emergency Response Benefit
• Reside in Canada and at least 15 years old
• Stopped working because of COVID19
• Had income of at least $5,000 in 2019 or in the 12 months prior to the date of their application
• Who are or expect to be without employment or self employment income for at least 14 consecutive days in the initial 4 week period.
• The income of at least $5,000 may be from any combination of the following sources: employment;self-employment;maternity and parental benefits under the EI program.
• The Benefit is only available to individuals who stopped work and are not earning employment or self-employment income as a result of reasons related to COVID-19. If you have not stopped working because of COVID-19, you are not eligible for the Benefit.
• If your situation continues, you can re-apply for a payment for multiple 4-week periods, to a maximum of 16 weeks (4 periods).
Remaining specifics of applying can be found at:
Also note that if you own a corp and do not pay yourself a salary, but only take a dividend from the corp, you may not qualify for this benefit. We will need to look at these on a case by case basis, if you need assistance.
Summary of Government changes during COVID-19
Canadian Emergency Business Account (CEBA)$40,000 interest free loan(government backed)
The CEBA is designed to support small business owners in meeting their immediate cash flow needs and includes:
• A $40,000 interest-free, government guaranteed loan to help pay for operating costs that can’t be deferred as a result of COVID 19.
• $10,000 (25%) of the $40,000 loan is eligible for complete forgiveness if $30,000 is fully repaid on or before December 31, 2022.
• If the loan cannot be repaid by December 31, 2022, it can be converted into a 3 year term loan at an interest rate of 5%.
Please check with your financial institution for specifics, but most banks seem to be rolling out as quickly as possible. Rollout will be through the online banking system, from my understanding. Here is a link for CIBC for example:
Temporary wage Subsidy for employers:
The Temporary Wage Subsidy for Employers is a three-month measure that will allow eligible employers to reduce the amount of payroll deductions required to be remitted to the Canada Revenue Agency (CRA).
You are an eligible employer if you:
• are a(n):
o individual (excluding trusts),
o partnership (see note below),
o non-profit organization,
o registered charity, or
o Canadian-controlled private corporation (including a cooperative corporation) eligible for the small business deduction;
• have an existing business number and payroll program account with the CRA on March 18, 2020; and
• pay salary, wages, bonuses, or other remuneration to an eligible employee.
An eligible employee is an individual who is employed in Canada.
The subsidy is equal to 10% of the remuneration you pay from March 18, 2020 to June 19, 2020, up to $1,375 for each eligible employee and to a maximum of $25,000 total per employer.
The subsidy is taxable and should be tracked in your general ledger to correctly account for it.
Note: Associated CCPCs will not be required to share the maximum subsidy of $25,000 per employer.
Please ask your payroll provider if you need assistance to navigate this subsidy.
The Canada Emergency Wage Subsidy (CEWS)
Please note that we are still waiting for written legislation on this subsidy. Also note this subsidy has challenges in that it assumes you have cash flow in order to make it through payrolls , until such tome the subsidy is received, which could be 6-8 weeks estimated at this time.
This subsidy may provide a 75-per-cent wage subsidy to eligible employers for up to 12 weeks, retroactive to March 15, 2020.
This wage subsidy aims to prevent further job losses, encourage employers to re-hire workers previously laid off as a result of COVID-19, and help better position Canadian companies and other employers to more easily resume normal operations following the crisis. While the Government has designed the proposed wage subsidy to provide generous and timely financial support to employers, it was done with the expectation that employers will do their part by using the subsidy in a manner that supports the health and well-being of their employees.
• individuals, taxable corporations, and partnerships consisting of eligible employers as well as non profit organizations and registered charities.
• This subsidy would be available to eligible employers that see a drop of at least 30 per cent of their revenue (see Eligible Periods). In applying for the subsidy, employers would be required to attest to the decline in revenue.
An employer’s revenue for this purpose would be its revenue from its business carried on in Canada earned from arm’s-length sources. Revenue would be calculated using the employer’s normal accounting method, and would exclude revenues from extraordinary items and amounts on account of capital.
Amount of Subsidy
The subsidy amount for a given employee on eligible remuneration paid between March 15 and June 6, 2020 would be the greater of:
• 75 per cent of the amount of remuneration paid, up to a maximum benefit of $847 per week; and
• the amount of remuneration paid, up to a maximum benefit of $847 per week or 75 per cent of the employee’s pre-crisis weekly remuneration, whichever is less.
Further guidance with respect to how to define pre-crisis weekly remuneration for a given employee will be provided in the coming days.
In effect, employers may be eligible for a subsidy of up to 100 per cent of the first 75 per cent of pre-crisis wages or salaries of existing employees. These employers would be expected where possible to maintain existing employees’ pre-crisis employment earnings.
Employers will also be eligible for a subsidy of up to 75 per cent of salaries and wages paid to new employees.
Eligible remuneration may include salary, wages, and other remuneration. These are amounts for which employers would generally be required to withhold or deduct amounts to remit to the Receiver General on account of the employee’s income tax obligation. However, it does not include severance pay, or items such as stock option benefits or the personal use of a corporate vehicle.
How to Apply
Eligible employers would be able to apply for the Canada Emergency Wage Subsidy through the Canada Revenue Agency’s My Business Account portal as well as a web-based application. Employers would have to keep records demonstrating their reduction in arm’s-length revenues and remuneration paid to employees. More details about the application process will be made available shortly.
In order to maintain the integrity of the program and to ensure that it helps Canadians keep their jobs, the employer would be required to repay amounts paid under the Canada Emergency Wage Subsidy if they do not meet the eligibility requirements and pay their employees accordingly. Penalties may apply in cases of fraudulent claims. In addition, anti abuse rules will be proposed to ensure that the subsidy is not inappropriately obtained and to ensure that employees are paid the amounts they are owed. The government is considering proposing to create new offences that will apply to individuals, employers or business administrators who provide false or misleading information to obtain access to this benefit or who misuse any funds obtained under the program. The penalties may include fines or even imprisonment.
Interaction with 10 per cent Wage Subsidy
On March 18, 2020, the Prime Minister announced a temporary 10 per cent wage subsidy. For employers that are eligible for both the Canada Emergency Wage Subsidy and the 10 per cent wage subsidy for a period, any benefit from the 10 per cent wage subsidy for remuneration paid in a specific period would generally reduce the amount available to be claimed under the Canada Emergency Wage Subsidy in that same period.
If you have questions or need specific clarifications on the proposed legislation for relief from COVID-19 issues, please contact our office to set up a meeting.