COVID-19 – Canadian Tax and Business News, release #27
Our COVID-19 Canadian Tax and Business News updates are our way of informing our clients, friends and business associates with recent information that may help businesses and individuals while coping with the outcomes from the COVID-19 pandemic.
Our goal is to monitor the news and release relevant information as it becomes available.
The summary below is based on our understanding and interpretation of the announcements made by the government. The information below is in summary form and subject to change until the proposals are passed as legislation. Contact one of our professionals to discuss these matters in the context of your situation before acting upon such information.
On December 4, 2020, many of the major financial institutions started accepting applications for the additional $20,000 CEBA loan. A full list of financial institutions is available on the CEBA website. Institutions currently accepting applications are highlighted in bold under the How Can I Apply For CEBA? Heading.
In order to apply, eligible businesses must attest and certify:
- that its business is facing ongoing financial hardship (including, for example, a continued decline in revenue or cash reserves, or an increase in operating costs) as a result of the COVID-19 pandemic;
- that it intends to continue to operate its business or to resume operations;
- that in response to the COVID-19 pandemic it has made all reasonable efforts to reduce its costs and to otherwise adapt its business to improve its viability; and
- that it has not used any loan received under the Program to make any payment or pay any expense other than Eligible Non-Deferrable Expenses. Specifically, the Borrower has not used any loan received under the Program to make any prepayment/refinancing of existing indebtedness, any payment of dividends, distributions or increases in management compensation or to increase the compensation of related parties.
Eligible Non-Deferrable Expenses include:
- wages and other employment expenses to independent (arm’s length) third parties;
- rent or lease payments for real estate used for business purposes;
- rent or lease payments for capital equipment used for business purposes;
- payments incurred for insurance related costs;
- payments incurred for property taxes;
- payments incurred for business purposes for telephone and utilities in the form of gas, oil, electricity, water and internet;
- payments for regularly scheduled debt service;
- payments incurred under agreements with independent contractors and fees required in order to maintain licenses, authorizations or permissions necessary to conduct business by the Borrower;
- payments incurred for materials consumed to produce a product ordinarily offered for sale by the Borrower; and
- any other expense in a category other than the above as may be indicated by GOC under the Web Page from time to time as being an Eligible Non-Deferrable Expense for the purpose of the Program.
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As we all try to stay safe, we need to remind ourselves business will get back to normal but in the meantime lets all do our part to get to normal as soon as we can. If you have any questions or require further information, don’t hesitate to reach out to us.
Get in touch by email: info@fazzaripartners.com or phone: 905.738.5758
