Temporary 10% Wage Subsidy
I am a business owner or employer. How do I know if I am eligible?
In order to be eligible, the employer must meet three criteria:
- employ one or more individuals in Canada (“eligible employees”);
- was registered, with a business number and a payroll remittance account, on March 18, 2020; and
- be any of the following:
- most Canadian-controlled private corporations (CCPCs), based on eligibility for the small business deduction
- an individual (other than a trust);
- a partnership,
- a non-profit organization (exempt from income tax pursuant to Subsection 149(1)(l)); or
- a registered charity.
A portion of remuneration (e.g. wages, salaries) paid to employees from March 18, 2020 to June 19, 2020, inclusive, will be recoverable by the employer.
The subsidy will be equal to the least of three amounts, as follows:
- a fixed maximum for each employer of $25,000. CRA has indicated that this amount is per employer, and is not required to be shared between related or associated employers;
- a fixed percentage, being 10%, of remuneration paid to eligible employees during the period from March 18, 2020 to June 19, 2020; or
- the number of eligible employees employed during the period from March 18, 2020, to June 19, 2020, multiplied by a fixed amount, $1,375.
Therefore, to get the maximum benefit of $25,000, the employer must have more than 18 employees with total wages no less than $250,000 during the period.
Note: If the Canada Emergency Wage Subsidy (75%) is applied for, that this subsidy will act to reduce the 75% subsidy.
No application required. Source deduction remittances for income tax, but not for CPP or EI, can be reduced for the available calculated subsidy, providing an immediate cash flow benefit to the employer.