Many clients are asking about the wage subsidy government introduced due to the COVID 19 pandemic. The full text posted by the government of Canada you can find there, but below is a summary of the changes.
- The subsidy amount is equal to 75% per employee, with the maxing amount at $847 per week.
- The subsidy applies to individuals, corporations, and partnerships – so-called “eligible employers.”
- The revenue drop between the current month and the same month in the previous year should be at least 15% for the first period and 30% for the following periods.
- You can clime CEWS against wages in three periods: March 15-April 11; April 12-May 9; May 10-June 6 for each of March, April, and May, respectively.
- The application is available through CRA MyBusiness Portal.
- When employers are eligible for both the CEWS and the 10% wage subsidy, any benefit from the 10% wage subsidy generally reduces the amount available to be claimed under the CEWS.
- The CEWS considered as an employer’s income and taxable.
- Fraudulent claims may result in fines and imprisonment. The artificial transactions will result in a 25% penalty of the value of subsidy in addition to the requirement to repay the subsidy amount in full.
- Employer-paid contribution to CPP and EI is 100% refundable for each week the employees are on leave with pay and for which the employer is eligible to claim for the CEWS for those employees.
Anna Grigoryan is a public accountant who provides accounting, bookkeeping and tax services to Small Business owners and individuals. She has more than ten years of professional experience in public accounting and a bachelor’s degree in Business Accounting. Anna is the founder and CEO of Taxory, an accounting firm located in Ontario, Canada.