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Expanded Eligibility for the Canada Emergency Business Account (CEBA)

May 19, 2020

Further to today’s announcement from the Federal Government, the CEBA loans program will now include:

  • sole proprietors receiving income from their businesses
  • businesses that rely on contractors
  • family-owned corporations that pay employees, including owner-employees, using dividends as opposed to payroll/wages

Entities with payroll less than $20,000 in 2019 would need the following to qualify under the expanded rules:

  • 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; and
  • have 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.

The government is working on solutions to the CEBA to be able to include new businesses, that have yet to file a tax return and businesses that operate through “personal” bank accounts as opposed to “business” bank accounts.

If you would like more information on this topic, please contact a member of the Empire CPA team by filling out the contact form below.

Canadian and foreign tax laws are complex and have a tendency to change on a frequent basis. As such, the content published above is believed to be accurate as of the date of this post. Before implementing any tax planning, please seek professional advice from a qualified tax professional. Empire, Chartered Professional Accountants will not accept any liability for any tax ramifications that may result from acting based on the information contained above.

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