10% Temporary Wage Subsidy for COVID-19
To support small businesses facing challenges due to COVID-19 economic slowdown, small businesses and non-profits are immediately eligible for a 10% subsidy on the wages they pay their employees between March 18 and June 20
This program co-exists with the 75% Canada Emergency Wage Subsidy program. For businesses not eligible for the 75% subsidy, the 10% subsidy may still be applicable. For employers that are eligible for both programs for a period, any benefit from the 10 per cent wage subsidy for remuneration paid in a specific period would generally reduce the amount available to be claimed under the Canada Emergency Wage Subsidy in that same period.
- Non-profits, registered charities, and private Canadian-controlled corporations (CCPCs) eligible for the small business deduction (must have less than $15 million in taxable capital in Canada);
- Have an existing business number and payroll program account with the CRA on March 18, 2020; and
- Pay salary, wages, bonuses, or other remuneration to an employee
- Subsidy will equal 10% of wages paid between March 18, 2020 and June 20, 2020
- Subsidy will have a cap of $1,375 per employee and $25,000 in total per employer
How To Calculate and How to Get the Subsidy
- Businesses will calculate the subsidy manually by multiplying your wages/payroll by 0.10 for any given period
- Once you have calculated your subsidy, you can reduce your current payroll remittance of federal, provincial, or territorial income tax that you send to the CRA by the amount of the subsidy and keep that money
- You cannot reduce your remittance of CPP contributions or EI premiums. You must continue remitting the CPP contributions and EI premiums that you deducted from your employees, as well as your share of CPP contributions and EI premiums, to the CRA.
- If the subsidy is more than your tax remittance, you can deduct the balance from future remittances, even if after June 20
For the full walk-through and questions-and-answers, visit the Government of Canada wage subsidy page here
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