Canada Emergency Wage Subsidy (CEWS)

The Tax Blog for Smart Canadians

Tips and tricks for Canadian tax filers at every stage of life from UFile's tax expert Gerry Vittoratos

Canada Emergency Wage Subsidy (CEWS)

by UFile Team Équipe ImpôtExpert | Apr 06, 2020   Comments:

UFile Blog - Canada Emergency Wage Subsidy (CEWS)

The federal government recently introduced a wage subsidy to help businesses keep their staff working during the COVID-19 pandemic. What is it, and how does it work? Let’s find out.

What is the Canada Emergency Wage Subsidy?

The federal government is offering a wage subsidy of 75% to qualifying businesses for up to three months, retroactive to March 15, 2020. The subsidy received will be 75% of the first $58,700 normally earned by an employee, representing a benefit of up to $847 per week. The program will be in place for a 12-week period from March 15 to June 6, 2020.

Who is eligible?

The subsidy is available to all employers regardless of size (by income or number of employees) who suffer a drop in gross revenues of at least 30% in March, April or May of 2020 when compared to the same months in 2019.

The employer can be an individual, a taxable corporation, a partnership consisting of eligible employers, a non‑profit organization or a registered charity.

Employers cannot claim this emergency subsidy for employees who are collecting the Canada Emergency Response Benefit (CERB).

Employers who are currently receiving the temporary 10% wage subsidy are eligible for this new emergency subsidy but will receive a reduced amount.  

To maintain their eligibility, employers must do everything in their power to ensure payment of the remaining 25% of earnings.

How to apply?

Eligible employers can apply through the CRA’s My Business Account portal. They have to keep detailed records to prove a reduction in their revenues.

For more information on the CEWS, please see the link below:

Want to learn more? Connect with us on Facebook and Twitter for news and updates on the 2019 tax return and UFile online tax software. Visit Tax & U to get accurate answers to all your questions about your 2019 tax return

Leave a comment