COVID-19 – Canadian Tax and Business News, release #31
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.
Ontario Business Support Grants
On January 15, 2021, the government of Ontario announced the application portal for the Ontario Small Business Support Grant is open. The grant will provide a minimum of $10,000 and up to a maximum of $20,000 in support to help small business owners during the pandemic. The grant will provide businesses with dollar-for-dollar funding to help cover decreased revenue expected because of the Ontario wide shutdown. The deadline to apply for funding is March 31, 2021.
Eligibility
Eligible businesses include those that:
- Were in operation before December 24, 2020. Businesses in operation on or after December 24, 2020 are not eligible
- Were required to close or significantly restrict services due to the Provincewide Shutdown being imposed across the province effective 12:01 a.m. on December 26
- Have fewer than 100 employees at the enterprise level or between “affiliated enterprises” (discussed below)
- Have experienced a minimum of 20% revenue decline in April 2020 compared to April 2019
- Are listed in the Ontario Application Guide under the Eligible Businesses section. See the end of the article for a complete listing of eligible industries
Businesses that were not in operation in April of 2019 can use alternative revenue decline comparator method which are provided in the application portal.
Non-eligible businesses include:
- Businesses that were already required to close prior to the introduction of the modified Stage 2 measures
- Essential businesses permitted to operate with capacity restrictions (e.g., discount and big box stores selling groceries, supermarkets, grocery stores, convenience stores, pharmacies, and beer, wine and liquor stores).
Affiliated Enterprises
Enterprises are affiliated if:
- One enterprise controls the other enterprise directly or indirectly
- Each enterprise is controlled by the same enterprise, individual or group of individuals and enterprises
Affiliated enterprises must calculate their revenue decline on an aggregate basis. The applicant enterprise must combine its revenues with the revenues of all affiliated enterprises for April 2020 and compare it to April 2019. If the aggregate decline is less than 20%, the business is not eligible. If the decline is greater than 20% on an aggregate basis, the revenue decline of the group will be used to determine the grant available. Only one enterprise within an affiliated group can apply. If a new enterprise was started in November or December 2020 that is part of the affiliated group, it can be omitted from the calculation of the affiliated group’s revenue decline.
Revenue
Revenue is defined as revenues from ordinary activities in Ontario earned from arm’s length sources determined in accordance with normal accounting practices. Inter-company revenues must be excluded. Furthermore, revenues from extraordinary items and amounts on account of capital are excluded.
Winter seasonal businesses will have their revenue decline calculated by comparing the higher of revenue from December 2019 or January 2020 compared to December 2020.
Payment
The program is a discretionary and non-entitlement program. Therefore, there is no guarantee funding will be approved even if the program criteria are met and a complete application is submitted. For approved applications, payments are expected to be processed within 10 business days unless the application is incomplete, incorrect or requires additional review.
Eligible industries
Only businesses from the following list are eligible to apply for funding under this program:
- Before- and after- school programs
- Campgrounds
- Cannabis retail stores
- Cell phone and computer providers & repairs
- Community centres and multi-purpose facilities
- Conference centres and convention centres
- Day camps for children
- Domestic services
- Drive-in cinemas
- Driving instruction
- Facilities for indoor sports and recreational fitness activities (including fitness centres and gyms)
- Garden centres
- Hardware stores (including Big Box stores) required to close for in-person shopping
- In person teaching and instruction
- Media industries including film and television production (excluding radio/television broadcasting)
- Meeting or event space
- Museums, galleries, aquariums, zoos, science centres, landmarks, historic sites, botanical gardens and similar attraction
- Outdoor markets (excluding grocery)
- Outdoor sports and recreation facilities
- Performing arts and cinemas
- Personal care services relating to the hair or body (excluding oxygen bars)
- Personal services
- Pet/animal food and services
- Photography services
- Racing venues, casinos, bingo halls and gaming establishments
- Rental and leasing services (including automobile, commercial and light industrial machinery and equipment rental)
- Restaurants and bars
- Retail required to close for in-person shopping
- Safety, medical and assistive devices retail (excluding pharmacies)
- Shopping malls
- Ski hills
- Tour and guide services
- Vehicle and equipment repair services
- Veterinary services
Resources
Ontario News Release – Applications Open for Ontario SBSG
Ontario SBSG Application Portal
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
