75% Wage Subsidy for COVID-19 – Canada Emergency Wage Subsidy

COVID-19 Updates & Resources

 

To support businesses facing challenges due to COVID-19 economic slowdown, businesses, non-profits and charities are immediately eligible for an up to 75% subsidy on the wages paid to their employees from March 15 through August 29, 2020

Applications Open Now — Review the online calculator to see the level of support you can receive and submit your application!  Click here

This program co-exists with the 10% Temporary 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.  The 75% subsidy covers wages paid from March 15 through August 29, 2020.

Eligibility:

  • All businesses, non-profits, and registered charities that have seen gross revenues decline by at least 15% in March and  30% in April and May compared to the same month in 2019 (revenue for this purpose would be revenue from business carried on in Canada, and calculated using the employer’s normal accounting method).  For the periods after June 6, the eligibility threshold is being reviewed. 
  • For those companies for which a year-over-year comparison would mean they are ineligible, they will also have the option of comparing March/April/May revenues to the average of their January and February 2020 revenues to show the needed 15% and 30% declines.  You may only use one method of calculating revenues for the duration of the program.
  • Non-profits and charities can choose to include or exclude government funding sources when they calculate their 15% and 30% declines, and would not include revenue from not-arms-length persons.
  • Applicants can recognize revenue either on a cash basis or on an accrual basis, but must choose one method for the duration of the program.
  • Must have an existing business number and payroll program account with the CRA
  • Must pay salary, wages, bonuses, or other remuneration to an employee
  • There is no cap on the number of employees or size of payroll
  • For those businesses not eligible for the 75% wage subsidy, the previous 10% wage subsidy is still available

Subsidy Amount:

  • The subsidy will cover 75% of the first $58,700 in salary, providing up to $847 maximum per week per employee
  • The actual amount an employer will receive will be calculated per employee as the greater of
    • 75% of the actual wages paid, up to a maximum benefit of $847 per week; and
    • the lesser of: the actual wages paid in a week, 75% of the employee’s pre-crisis weekly pay, and $847 per week.
    • This means if an employer pays equal to or less than 75% of the baseline pay for an eligible employee, the employer is eligible for a 100% wage subsidy in respect of that employee
  • There is no overall limit on the subsidy amount that an eligible employer may claim.
  • An eligible employer’s entitlement to this wage subsidy will be based entirely on the salary or wages actually paid to employees
  • For employees which are getting paid using the subsidy, but are not doing any work for the company, (on leave with pay) the employer is also able to apply for a 100% refund for employer-paid contributions to Employment Insurance and the Canada Pension Plan for the weeks the employees are not doing work.  Employers still both collect and remit payments for these programs, but apply for this refund during the wage subsidy application.
  • The amount of subsidy received will be less whatever subsidy the employer was eligible for via the 10% Temporary Wage Subsidy program regardless if they have used that program yet or not.  Eligible employers should reduce their remittance in accordance to the 10% program
  • The subsidy will be less any monies employees have earned through a EI Work-Sharing program

How to Apply and Get the Subsidy:

  • Organizations will need to apply directly to get the subsidy through the Canada Revenue Agency here
  • Applicants will make a legal attestation/declaration that they meet the 15%/30% criteria
  • The subsidy will work like a rebate, with each application covering the wages paid during a specified reporting period
  • Once an employer is found eligible for a specific period, they would automatically qualify for the next period of the program.  For example, an employer with a revenue drop of 30% in April would qualify for the second (April 12-May 9) and third periods (May 10-June 6) of the program
  • The gross revenue used to calculate eligibility will be based on the month that each reporting period starts in (see table below)
  • Once applications are submitted and approved, the government estimates direct payments to applicant organizations will be made within 6 weeks
  • Applicants will need to make a legal attestation on the application that they are “doing everything they can” to top up the remaining 25% of salaries.  However, this will not be possible for all employers, and it is not a requirement of the program.

Eligibility Periods

The table below outlines each claiming period and the period in which it has a decline in revenue of 30 per cent or more.

Eligible Period
  Claiming period Reference period for eligibility
Period 1 March 15 – April 11 March 2020 over March 2019, OR over the average of January and February 2020
Period 2 April 12 – May 9 April 2020 over April 2019 OR over the average of January and February 2020
Period 3 May 10 – June 6 May 2020 over May 2019 OR over the average of January and February 2020
Period 4 June 6 – TBC
Period 5 July – TBC
Period 6 August – TBC

 

For more info, visit the Government of Canada COVID-19 page