Federal and Provincial Economic Responses to COVID-19

Federal and Provincial Economic Responses to COVID-19, 5-Part Investor Friendly Webinar starting April 07, 2020

On behalf of all of us at DLD Financial Group Ltd – we hope that you are staying safe and healthy. With the ever changing developments, we thought it would be helpful to highlight some of the Federal and Provincial Economic Responses to COVID-19 that may apply to you.

For those of you who are interested, Mackenzie Investments is offering a 5-part Investor-Friendly Webinar series – the first one takes place on Tuesday, April 07, 2020.

FEDERAL:

Click below to view the Government of Canada’s economic response to COVID-19 – Current as of March 27, 2020.

Source: Baker Tilly Canada Cooperative

Support for Workers

Employment Insurance

  • Waive usual one-week waiting period for those under quarantine or home to care for children
  • Waive medical certificate requirement in certain cases

Canada Emergency Response Benefit (CERB)

  • $2000/mth for up to 16 weeks, applied for in 4-week periods
  • for those who have lost their job or face reduced hours for reasons related to COVID-19, where they are over the age of 14 and earned at least $5000 in 2019 (or in a 12-month period preceding the application date)
  • for wage earners, contract workers, and self-employed workers (i.e. sole proprietors) whether eligible for EI or not
  • not eligible where individual already receiving EI
Support for Businesses

Temporary Wage Subsidy

  • up to 75% wage subsidy being provided to qualifying businesses for up to 3 months retroactive to March 15 with the intention of keeping employees on payroll
  • the qualifying business must be able to demonstrate at least a 30% decrease in revenue to qualify and is applicable to the first $58,700 of wages per employee or $847/week
  • Revenues will be compared monthly for March, April and May of 2019 and businesses need to re-apply monthly
  • Businesses must attest that you are doing everything you can to meet the 25% amount
  • ‘Payments will be made within 6 weeks and applications will be through the Canada Revenue Agency
  • https://business.financialpost.com/personal-finance/taxes/covid-19-canada-emergency-wage-subsidy-guide

Canada Emergency Business Account

  • this program will provide up to $40,000 in an interest free government backed loan from your financial institution to help cover operating costs in a period where revenues have been temporarily decreased
  • to qualify, the organization has to be able to show that at least $50,000 – $1 million has been paid in total 2019 payroll
  • repaying the balance of the loan before Dec 31, 2022 may result in up to 25% of up to $10,000 in loan forgiveness

Deferred Payment Deadlines

  • CRA allowing all businesses to defer payments of income tax amounts owing on or after March 18, 2020 and before September 2020
  • this relief applies to tax balances due and as well as income tax installments – this does not include payroll remittances
Taxes

Income Tax Filing Deadline

  • Extension to June 1 for individuals (self-employed deadline remains at June 15)
  • Extension to May 1 for trusts with Dec 31, 2019 year-end

Income Tax Payment Deadline

  • Defer collection, until after August 31, 2020 of installments and balances due for individuals and corporations

Minimum RRIF Withdrawals

Debt Collection

  • Halted until further notice
Other

Loans and Credit Facilities

  • six-month interest-free moratorium on repayment of Canada student loans
  • mortgage deferral of up to 6 months – please consult with your financial institution for more details

Canada Child Benefit

  • an extra $300 per child will be tacked onto the May CCB payment

Sources:

Jamie Golombek – Financial Post https://business.financialpost.com/personal-finance/taxes/heres-what-small-businesses-need-to-know-about-the-covid-19-wage-subsidy-program;

Prime Minister Justin Trudeau –https://pm.gc.ca/en/news/news-releases/2020/03/27/prime-minister-announces-support-small-businesses-facing-impactshttps://www.canada.ca/en/employment-social-development/corporate/notices/coronavirus.html#child-benefit

Government of Canada- https://www.canada.ca/en/department-finance/economic-response-plan.html

Federal and Provincial Economic Responses to COVID-19
PROVINCIAL – British Columbia:
Support for Workers

Emergency Benefit for Workers

  • one-time payments of $1000 for people laid off, ill, quarantined or staying home to care for children or ill family members
  • eligible whether receiving EI or CERB

Job Protection

  • Illnesses must be excused without a doctor’s note
  • Employees can access unpaid, job-protected leave due to COVID-19

Child Care

  • Child care providers remaining open will continue to receive ECE wage enhancements and are eligible to receive up to seven times the average monthly funding
  • Child care providers closing due to COVID-19 are eligible to receive two times their average monthly government funding
Support for Businesses

Employer Health Tax (EHT)

  • payment deferral until Sep 30, 2020 for employers not already exempt from EHT

Business Taxes

  • Extended to Sep 30, 2020 filing and payment deadlines for provincial sales tax (PST), municipal and regional district on short-term accommodation, tobacco tax, motor fuel tax and carbon tax
  • school tax cut in half for business and light-industry and major-industry property classes
  • Scheduled April 1 increase to provincial carbon tax and PST on sweetened carbonated drinks postponed
  • Scheduled April 1 PST registration requirements on e-commerce have been postponed
Other

Utility Payments

  • BC Hydro and Fortis BC are waiving penalties and late payment fees and offering flexible payment plans

Medical Service Plan (MSP)

  • waive usual 6 month waiting period for residents returning from an area impacted by COVID-19
  • waive usual seven-month maximum travel outside BC for MSP coverage

Loans and Credit Facilities

  • a six-month freeze on student loan payments starting March 30, 2020

Renters and Landlords

  • temporary rental supplement up to $500 per month paid directly to landlords ensuring they continue to receive rental income
  • halting new and active evictions, except for exceptional circumstances
  • freezing annual rent increases

Insurance Corporation of BC (ICBC)

  • extends deferrals for up to 90 days

Sources:  Government of British Columbia https://www2.gov.bc.ca/gov/content/safety/emergency-preparedness-response-recovery/covid-19-provincial-support; CI Investments

We hope you find this information helpful and please do not hesitate to reach out if you have any questions or if there’s anything we can do to help.

Thank you for your time and stay safe.
Dave, Kelly and Ryan

E&OE