Feds announce expansion of CEBA for small business
ON MONDAY, THE federal government announced an expansion to the eligibility criteria for the Canada Emergency Business Account (CEBA) to include many owner-operated small businesses. The extended measure to the CEBA in intended to allow more Canadian small businesses to access interest-free loans that will help cover operating costs during a period when revenues have been reduced due to the Covid-19 pandemic.
“Canadians are counting on us to protect their jobs and help them pay their bills during this difficult time. By expanding the CEBA, we will be giving more businesses access to the support they need, so they can help protect workers and the jobs they rely on. Today we are helping to keep more businesses open and more Canadians working, so we are better prepared for the recovery to come,” said Prime Minister Justin Trudeau at his daily news briefing.
The program will now be available to a greater number of businesses that are sole proprietors receiving income directly from their businesses, businesses that rely on contractors and family-owned corporations that pay employees through dividends rather than payroll.
To qualify under the expanded eligibility criteria, applicants with payroll lower than $20,000 would need:
- A business operating account at a participating financial institution;
- A Canada Revenue Agency business number, and to have filed a 2018 or 2019 tax return;
- Eligible non-deferrable expenses between $40,000 and $1.5 million. Eligible non-deferrable expenses could include costs such as rent, property taxes, utilities and insurance.
Expenses will be subject to verification and audit by the Government of Canada, and funding will be delivered in partnership with financial institutions.
According to the government, more details, including the launch date for applications under the new criteria, will follow in the days to come. To date, over 600,000 small businesses have accessed the CEBA, and the government will work on potential solutions to help business owners and entrepreneurs who operate through their personal bank account, as opposed to a business account, or have yet to file a tax return, such as newly created businesses.