Lower rent by 75% for small businesses that have been affected by COVID-19
The Application portal for the Canada Emergency Commercial Rent Assistance (CECRA) opens at 8:00am EST on May 25th. The description from the CMHC website:
“Canada Emergency Commercial Rent Assistance (CECRA) for small businesses provides relief for small businesses experiencing financial hardship due to COVID-19. It offers unsecured, forgivable loans to eligible commercial property owners to:
Property owners must offer a minimum of a 75% rent reduction for the months of April, May and June 2020.”
Application Dates
Due to expected high volumes of applications, the application dates will be as follows:
-
Monday – Property owners who are located in Atlantic Canada, BC, Alberta and Quebec, with up to 10 tenants who are eligible for the program
-
Tuesday – Property owners who are located in Manitoba, Saskatchewan, Ontario and the Territories, with up to 10 tenants who are eligible for the program
-
Wednesday – All other property owners in Manitoba, Saskatchewan, Ontario and the Territories
-
Thursday – All other property owners in Atlantic Canada, BC, Alberta and Quebec
-
Friday – All
Eligibility
From the CMHC website:
“To qualify for CECRA for small businesses, the commercial property owner must:
-
own commercial real property* which is occupied by one or more impacted small business tenants
-
enter (or have already entered) into a legally binding rent reduction agreement for the period of April, May and June 2020, reducing an impacted small business tenant’s rent by at least 75%
-
ensure the rent reduction agreement with each impacted tenant includes:
-
-
a moratorium on eviction for the period during which the property owner agrees to apply the loan proceeds, and
-
a declaration of rental revenue included in the attestation
The commercial property owner is not and is not controlled by an individual holding federal or provincial political office.
CECRA will not apply to any federal-, provincial-, or municipal-owned properties, where the government is the landlord of the small business tenant.
Exceptions
-
Where there is a long-term lease to a First Nation, or Indigenous organization or government, the First Nation or Indigenous organization or government is eligible for CECRA for small businesses as a property owner.
-
Where there are long-term commercial leases with third parties to operate the property (for example, airports), the third party is eligible as the property owner.
-
Also eligible are post-secondary institutions, hospitals, and pension funds, as well as crown corporations with limited appropriations designated as eligible under CECRA for small businesses.
NOTE: Small businesses that opened on or after March 1, 2020 are not eligible.
* We define commercial Real Property as a commercial property with small business tenants. Commercial properties with a residential component and multi-unit residential mixed-use properties would equally be eligible with respect to their small business tenants.
NOTE: Properties with or without a mortgage are eligible under CECRA for small businesses.
What is an impacted small business tenant?
Impacted small business tenants are businesses — including non-profit and charitable organizations — that:
-
pay no more than $50,000 in monthly gross rent per location (as defined by a valid and enforceable lease agreement)
-
generate no more than $20 million in gross annual revenues, calculated on a consolidated basis (at the ultimate parent level)
-
have experienced at least a 70% decline in pre-COVID-19 revenues **
NOTE: Eligible small business tenants who are in sub-tenancy arrangements are also eligible, if these lease structures meet program criteria.
** Small businesses can compare revenues in April, May and June of 2020 to that of the same period in 2019 to measure revenue losses. They can also use an average of their revenues earned in January and February of 2020.“
For Full Details and to apply:
Details of the EXPANDED Canada Emergency Wage Subsidy
/in 2020 Only, blog, Coronavirus, Coronavirus - Practice Owners /by Bryan WilsonOn August 11th, the Government of Canada updated the calculator and Canada.ca with the changes to the Canada Emergency Wage Subsidy (CEWS).
If you’re a business owner who has suffered losses as a result of COVID-19 and did NOT qualify previously for CEWS, you may now qualify.
The changes expand the program to include more businesses for periods 5 to 9 (July 5 to November 21, 2020) and have been published on Canada.ca, here are some of the changes:
the subsidy rate varies, depending on how much your revenue dropped
if your revenue drop was less than 30% you can still qualify, and keep getting the subsidy as employees return to work and your revenue recovers
employers who were hardest hit over a period of three months get a higher amount
employees who were unpaid for 14 or more days can now be included in your calculation
use the current period’s revenue drop or the previous period’s, whichever works in your favour
for periods 5 and 6, if your revenue dropped at least 30%, your subsidy rate will be at least 75%
even if your revenue has not dropped for the claim period, you can still qualify if your average revenue over the previous three months dropped more than 50%
the maximum base subsidy rate is 60% in claim periods 5 and 6
the maximum base subsidy rate will begin to decline in claim period 7, gradually reducing to 20% in period 9
The Government of Canada has updated the CEWS calculator to reflect these changes and can be found here:
6 Steps to Retirement Success
/in blog, Business Owners, Family, Investment, Retirees, RRSP, Tax Free Savings Account /by Bryan WilsonRetirement planning can be challenging, we’ve outlined what we feel are 6 steps to retirement success.
Have a written plan which merges life priorities with financial resources.
Consolidate your income-producing assets with one advisor.
Layer different sources of income in the most efficient manner.
Structure income in order to preserve valuable tax credits and government benefits.
Create efficient cash flow by investing your income-producing assets wisely.
Implement efficient solutions for health-cost risks and wealth transfer strategies.
Talk to us about a complimentary comprehensive review of your retirement plan.
Canada Emergency Wage Subsidy expanded to include more businesses!
/in blog, Business Owners, Coronavirus, Coronavirus - Practice Owners, corporate /by Bryan WilsonOn July 17th, Finance Minister Bill Morneau announced proposed changes to the Canada Emergency Wage Subsidy (CEWS) that will expand the number of businesses that qualify for the program.
The major changes he announced were:
“First, we’re proposing to extend this program through until December 19th.”
“Secondly, we know that it’s also critical that we have the businesses able to continue to hire people even as they get into the restart and we know that the requirements in businesses have a 30% reduction in revenue is not helpful in that regard.”
“businesses will get the wage subsidy if they’ve had any reduction in revenue so it’s going to go all the way down to businesses who even have a small amount of revenue reduction they’ll get the subsidy and it will be in proportion to the amount of the revenue reduction that they will get a subsidy.”
“Third, we’ve tailored the program so that it helps those organizations that are particularly hard hit. So for organizations with over a 50% reduction of revenue over the last few months they’ll actually get a top up, they’ll get up to 25% additional subsidy so that they can deal with this really challenging time for their businesses.”
“What that means for businesses, those that were already in the program that have that 30% revenue decline that will continue to be the case for July and August. For those businesses as I said that are particularly hard hit it will be even more. It will go up to 85% wage subsidy or $960 per person.”
“For those businesses less hard hit but still hit they will be able to get into the program. The program will continue but as we restart, the program will be tailored to help businesses appropriately in that restart.”
The new rules will be retroactive to July 5th but require parliamentary approval.
VIEW THE NEWS RELEASE FOR THE REVISED CEWS
Canada Emergency Wage Subsidy extended into December!
/in blog, Business Owners, Coronavirus, Coronavirus - Practice Owners, corporate /by Bryan WilsonOn July 13th, Prime Minister Justin Trudeau announced the extension of the Canada Emergency Wage Subsidy (CEWS) until December. The Prime Minster stated:
More details will be released during the week.
Retirement Planning for Business Owners
/in blog, Business Owners, corporate, Retirees, RRSP, Tax, Tax Free Savings Account /by Bryan WilsonRetirement planning can be a complex process for us all, but if you are the owner of a small business it may can get even more complicated, due to the various factors and circumstances that you have to take into consideration. A common mistake made by small business owners is reinvesting extra money to grow their business, at the expense of putting it aside to save for their retirement.
Although there is no magic formula for getting started on a retirement strategy for your business, there are some general principles which might help you to get a handle on the steps that you need to take. One of the key ideas is the consideration of both your business and your personal finances and how to structure and integrate the two in order to create a robust retirement financial strategy.
Here are some tips on how to get started on a retirement plan.
Set aside time to plan for the future – It’s important to make retirement planning a priority, or you run the risk of never getting around to it. A professional financial planner can help you to assess your personal circumstances and create a personalized plan that suits you and your business, with the right balance between saving and reinvestment to help your business to grow.
Think about your future retirement income – Here are the main sources of retirement income that small business owners usually rely on:
Equity held in your business – If your business is successful, you are likely to benefit from equity from it in your retirement. Selling your company is an option, particularly attractive to some as, in some cases, you could benefit from the lifetime capital gains exemption on the sale. Of course, finding the right person to run your business in the future is easier said than done. A clear succession plan, created in advance of your retirement, can help you to ensure that business continuity will be affected as little as possible and will give you peace of mind as you approach your retirement. You may also want to consider using the expertise of an accountant or mergers and acquisitions specialist to help you to value your business correctly and also look after your interests when liaising with potential purchasers.
Alternatively, you may choose for your children to inherit your business, or you may decide to retain ownership of dividend-paying preferred shares in order to maintain an ongoing source of income.
Registered plans – A Registered Retirement Savings Plan (RRSP) can offer personal tax deductions on your contributions, plus your savings will grow as tax-deferred whilst in the plan. In addition, tax-free savings accounts (TFSAs) can be a useful way to save tax-free in particular circumstances.
Consider offering a retirement savings plan to your employees – Paying your statutory contribution of the Canada Pension Plan is just the minimum – many small businesses choose to offer their employees enhanced pension contributions as an incentive or employee benefit. For example, you could match their RRSP contributions to a set limit, to help their retirement nest grow more quickly. Alternatively, you could offer a benefit plan with an investment contribution package from an insurance company, which can be a more straightforward and cost-effective choice.
Be sure to diversify – As a small business owner, you should avoid putting all of your eggs in one basket, financially speaking, as this could leave you vulnerable to changes in the market. Try to diversify your investments and spread your funds in order to protect yourself and engage the help of a professional where necessary to help you to do so.
In summary, it’s important to remember that retirement planning is a process which is unique and personal to your own and your business’ circumstances and there is no uniform approach which works across the board. Take time to take stock of your current situation, as well as your goals for the future and this will help you to create a retirement plan that is right for your needs, both current and future.
CERB Extended | Business Owners who did not qualify previously – expanded CEBA starts June 19th
/in 2020 Only, blog, Business Owners, Coronavirus, Coronavirus - Associates, Coronavirus - Practice Owners, Coronavirus - Students, corporate, Individuals /by Bryan WilsonCERB Extended 2 more months
Great news for Canadians out of work and looking for work. The CERB will be extended another 8 weeks for a total of up to 24 weeks.
As the country begins to restart the economy, the Federal government will be making changes to the program to encourage Canadians receiving the benefit to get people back on the job. From Prime Minister Justin Trudeau’s website:
“The Government of Canada introduced the CERB to immediately help workers affected by the COVID-19 pandemic, so they could continue to put food on the table and pay their bills during this challenging time. As we begin to restart the economy and get people back on the job, Canadians receiving the benefit should be actively seeking work opportunities or planning to return to work, provided they are able and it is reasonable to do so.
That is why the government will also make changes to the CERB attestation, which will encourage Canadians receiving the benefit to find employment and consult Job Bank, Canada’s national employment service that offers tools to help with job searches.”
More small businesses can apply for CEBA $40,000 no-interest loans
Applications for the expanded Canada Emergency Business Account (CEBA) will be accepted as of Friday, June 19th, 2020. Small businesses that are:
“… owner-operated small businesses that had been ineligible for the program due to their lack of payroll, sole proprietors receiving business income directly, as well as family-owned corporations remunerating in the form of dividends rather than payroll will become eligible this week.”
Apply online at the financial institution your business banks with:
TD: https://www.forms.td.com/app/ceba/#/ceba/ceba-form
Scotiabank: https://www.scotiabank.com/ca/en/personal/scotia-support/latest-updates/business-banking/small-business/supporting-our-customers-is-our-top-priority.html
BMO: https://www.bmo.com/small-business/financial-relief-loc/#/login?PID=MBLBC&language=en
CIBC: https://www.cibc.com/en/business/advice-centre/covid-19/canada-emergency-business-account/now-available.html
RBC:https://www.rbc.com/covid-19/business.html
National Bank: https://www.nbc.ca/forms/business/covid-emergency-account.html
HSBC: https://www.hsbc.ca/1/2//applications/business-apply
Canadian Western Bank: https://www.cwbank.com/en/news/2020/canada-emergency-business-account-now-available (via phone/email)
There are restrictions on the funds can be used. From their website https://ceba-cuec.ca/:
Insurance Planning for Young Families
/in blog, disability insurance, Family, health benefits, Insurance, life insurance, travel insurance /by Bryan WilsonFor young families, making sure your family is financially protected can be overwhelming, especially since there’s so much information floating online. This infographic addresses the importance of insurance- personal insurance.
The 4 areas of personal insurance a young family should take care of are:
Health
Disability
Critical Illness
Life
Health: We are so fortunate to live in Canada, where the healthcare system pays for basic healthcare services for Canadian citizens and permanent residents. However, not everything healthcare related is covered, in reality, 30% of our health costs* are paid for out of pocket or through private insurance such as prescription medication, dental, prescription glasses, physiotherapy, etc.. Moreover, if you travel outside of Canada, medical emergencies can be extremely expensive.
Disability: Most people spend money on protecting their home and car, but many overlook protecting their greatest asset: their ability to earn income. Unfortunately one in three people on average will be disabled for 90 days or more at least once before age 65. Disability insurance can provide you with a portion of your income if you were to become disabled and unable to earn an income.
Critical Illness: For a lot of us, the idea of experiencing a critical illness such as a heart attack, stroke or cancer can seem unlikely, but almost 3 in 4 (73%) working Canadians know someone who experience a serious illness. Sadly, this can have serious consequences on you and your family, with Critical Illness insurance, it provides a lump sum payment so you can focus on your recovery.
Life: For young families, if your loved ones depend on you for financial support, then life insurance is absolutely necessary, because it replaces your income, pay off your debts and provides peace of mind.
Talk to us about helping making sure you and your family are protected.
Small Businesses! Applications for Canada Emergency Commercial Rent Assistance starts May 25th
/in 2020 Only, blog, Business Owners, Coronavirus, Coronavirus - Practice Owners, corporate /by Bryan WilsonLower rent by 75% for small businesses that have been affected by COVID-19
The Application portal for the Canada Emergency Commercial Rent Assistance (CECRA) opens at 8:00am EST on May 25th. The description from the CMHC website:
Application Dates
Due to expected high volumes of applications, the application dates will be as follows:
Monday – Property owners who are located in Atlantic Canada, BC, Alberta and Quebec, with up to 10 tenants who are eligible for the program
Tuesday – Property owners who are located in Manitoba, Saskatchewan, Ontario and the Territories, with up to 10 tenants who are eligible for the program
Wednesday – All other property owners in Manitoba, Saskatchewan, Ontario and the Territories
Thursday – All other property owners in Atlantic Canada, BC, Alberta and Quebec
Friday – All
Eligibility
From the CMHC website:
“To qualify for CECRA for small businesses, the commercial property owner must:
own commercial real property* which is occupied by one or more impacted small business tenants
enter (or have already entered) into a legally binding rent reduction agreement for the period of April, May and June 2020, reducing an impacted small business tenant’s rent by at least 75%
ensure the rent reduction agreement with each impacted tenant includes:
a moratorium on eviction for the period during which the property owner agrees to apply the loan proceeds, and
a declaration of rental revenue included in the attestation
The commercial property owner is not and is not controlled by an individual holding federal or provincial political office.
CECRA will not apply to any federal-, provincial-, or municipal-owned properties, where the government is the landlord of the small business tenant.
Exceptions
Where there is a long-term lease to a First Nation, or Indigenous organization or government, the First Nation or Indigenous organization or government is eligible for CECRA for small businesses as a property owner.
Where there are long-term commercial leases with third parties to operate the property (for example, airports), the third party is eligible as the property owner.
Also eligible are post-secondary institutions, hospitals, and pension funds, as well as crown corporations with limited appropriations designated as eligible under CECRA for small businesses.
NOTE: Small businesses that opened on or after March 1, 2020 are not eligible.
* We define commercial Real Property as a commercial property with small business tenants. Commercial properties with a residential component and multi-unit residential mixed-use properties would equally be eligible with respect to their small business tenants.
NOTE: Properties with or without a mortgage are eligible under CECRA for small businesses.
What is an impacted small business tenant?
Impacted small business tenants are businesses — including non-profit and charitable organizations — that:
pay no more than $50,000 in monthly gross rent per location (as defined by a valid and enforceable lease agreement)
generate no more than $20 million in gross annual revenues, calculated on a consolidated basis (at the ultimate parent level)
have experienced at least a 70% decline in pre-COVID-19 revenues **
NOTE: Eligible small business tenants who are in sub-tenancy arrangements are also eligible, if these lease structures meet program criteria.
** Small businesses can compare revenues in April, May and June of 2020 to that of the same period in 2019 to measure revenue losses. They can also use an average of their revenues earned in January and February of 2020.“
For Full Details and to apply:
Expanded eligibility for CEBA $40,000 interest-free loan
/in 2020 Only, blog, Business Owners, Coronavirus, Coronavirus - Practice Owners /by Bryan WilsonEligibility
The Prime Minister outlined the expanded eligibility for the Canada Emergency Business Account and highlighted companies such as hair salon owners, independent gym owners with contracted trainers and local physio businesses will now be eligible.
The eligible amounts are being expanded to include businesses with 2019 total payroll between $20,000 – $1.5 million.
How do I apply?
Prior to applying, please make sure you have this information readily available:
Canada Revenue Agency Business Number (BN 15 digits)
2019 T4 Summary of Remuneration Paid (T4SUM)
Apply online at the financial institution your business banks with:
TD: https://www.forms.td.com/app/ceba/#/ceba/ceba-form
Scotiabank: https://www.scotiabank.com/ca/en/personal/scotia-support/latest-updates/business-banking/small-business/supporting-our-customers-is-our-top-priority.html
BMO: https://www.bmo.com/small-business/financial-relief-loc/#/login?PID=MBLBC&language=en
CIBC: https://www.cibc.com/en/business/advice-centre/covid-19/canada-emergency-business-account/now-available.html
RBC:https://www.rbc.com/covid-19/business.html
National Bank: https://www.nbc.ca/forms/business/covid-emergency-account.html
HSBC: https://www.hsbc.ca/1/2//applications/business-apply
Canadian Western Bank: https://www.cwbank.com/en/news/2020/canada-emergency-business-account-now-available (via phone/email)
There are restrictions on the funds can be used. From their website https://ceba-cuec.ca/:
Apply starting Friday for Canada Emergency Student Benefit! Help on the way for seniors.
/in 2020 Only, blog, Coronavirus, Coronavirus - Retired, Coronavirus - Students, Retirement /by Bryan WilsonStudents can apply for $1,250 through the Canada Emergency Student Benefit starting Friday
From canada.ca:
“The Canada Emergency Student Benefit (CESB) provides financial support to post-secondary students, and recent post-secondary and high school graduates who are unable to find work due to COVID-19.
This benefit is for students who do not qualify for the Canada Emergency Response Benefit (CERB) or Employment Insurance (EI).
From May to August 2020, the CESB provides a payment to eligible students of:
$1,250 for each 4-week period
$2,000 for each 4 -week period, if you have dependants or a disability”
Seniors to receive up to $500 one-time payment
The Government of Canada will be providing help to vulnerable seniors by providing a one-time tax-free payment of $300 for seniors eligible for Old Age Security (OAS). For seniors eligible for the Guaranteed Income Supplement (GIS), they will receive an additional $200.