In an effort to support Canadian businesses and workers impacted by COVID-19 the Government has introduced the Economic Response Plan. The details of the programs have been summarized below. For full program information visit CANADA.CA/Coronavirus.
Note: All the information below is pulled from publicly available websites. For the most up-to-date information, please see ‘Useful links’ at the end of this article.
The highlights of the plan benefits for small businesses include:
The Jobs and Growth Fund is a $700-million program that supports regional job creation and positions local economies for long-term growth. This includes up to $70 million dedicated to businesses created after January 2020.
The Fund will help businesses and organizations that:
Apply through your regional development agency.
The Canada Recovery Hiring Program provides a subsidy on eligible salary or wages to help hard-hit businesses hire the workers they need to recover and grow as local economies reopen.
This program allows eligible employers to hire new workers, increase workers' hours, or increase wages at a pace that works for them. As with the Canada Emergency Wage Subsidy, eligible employers can apply for support after each four-week period of the program.
We are ensuring that businesses can continue to get the financial support they need to invest in their longer-term prosperity, including businesses in hard-hit sectors like tourism and hospitality, hotels, arts and entertainment.
Update:The government is proposing to extend the Canada Recovery Hiring Program until May 7, 2022, for eligible employers with current revenue losses above 10% and to increase the subsidy rate to 50%.T0 apply for the program through CRA
Update:The government is proposing targeted support for eligible hard-hit employers until March 13, 2022.
This support would be available through two new streams:
From March 13, 2022, to May 7, 2022, the subsidy rates will decrease by half.
Eligibility organizations must have experienced a drop in revenue which is calculated by comparing eligible revenue during the crisis with eligible revenue from a previous period (baseline revenue). Visit Canada.ca for details.
Rent Support : The Prime Minister recently announced the Canada Emergency Rent Subsidy (CERS), a revamped commercial rent-relief program that will support businesses, charities and non-profits who have seen a drop in revenue due to the COVID-19 pandemic. Under CERS, qualified organizations can receive up to 65% of rent and mortgage expenses.
Update:The government is proposing targeted support for eligible hard-hit employers until March 13, 2022. To apply or for more information visit: Canada.ca
Regional Relief and Recovery Fund (RRRF): Helps businesses and organizations in sectors such as manufacturing, technology, tourism and others that are key to the regions and to local economies. This fund is specifically targeted to those that may require additional help to recover from the COVID-19 pandemic, but have been unable to access other support measures. For details see your local Regional Development Agency: https://www.ic.gc.ca/eic/site/icgc.nsf/eng/h_07662.html
The Highly Affected Sectors Credit Availability Program provides businesses heavily impacted by COVID-19, access guaranteed, low-interest loans of $25,000 to $1 million to cover operational cash flow needs.
HASCAP is available to businesses that operate in sectors such as tourism and hospitality, restaurants and those that primarily rely on in-person services.
Business owners can apply for support until December 31, 2021.
Small Business Loans: Government will guarantee interest-free bank loans of up to $40,000 for small businesses who have paid between $50,000 and $1.5M in 2019 payroll. Repayment of the balance of the loan on or before December 31, 2022, will result in loan forgiveness of 25 per cent (up to $10k). (full details will be posted on Canada.ca soon).
Also see: How to Qualify for a Small Business Loan from Quickbooks
Note: On October 9 the government announced an expansion to the small business loans program by providing an added $10,000 that could be forgivable. (For more details visit Canada.ca).
Note: Additional loan programs for small and medium-sized enterprises are available through the Co-Lending Program
Larger Business Loans: The Large Employer Emergency Financing Facility (LEEFF) will provide support to employers from all sectors with annual revenues of more than $300 million whose credit needs aren't being met through conventional financing.
To qualify, businesses must be looking for financing of $60 million+, have significant operations or workforce in Canada and not be involved in ongoing insolvency proceedings.
Interested companies must disclose their climate action plans and sustainability goals to qualify and must meet other conditions, including not having "excessive" executive pay. Companies that have been found guilty of tax evasion are disqualified.
(The application period is now open, for more details visit: https://www.cdev.gc.ca/home-ceefc )
For more details visit: https://www.bdc.ca/en/financing/pages/default.aspx
Last Update: October 24, 2021 Ver 2.4