Kapadia LLP CPAs

Canadian businesses should be aware that, while many programs which provided payroll or expense supports for businesses during the pandemic ended on May 7, 2022, there is still a program in place to help employers with payroll costs. As well, even for programs which ended on May 7, applications can still be made for relief for claim periods prior to that date.

The reason that applications for relief can still be made is that the application process works on a rolling basis, in which an application for relief can be made up to six months after the end of the particular claim period for which such relief is sought. The program that is still in place, and those for which applications can still be made for claim periods prior to May 7, 2022, are outlined below.

Work-Sharing Program

A Work-Sharing agreement helps employers and employees avoid layoffs when there is a temporary decrease in the normal level of business activity that is beyond the control of the employer.

The agreement made provides income support to employees eligible for Employment Insurance benefits who work a temporarily reduced work week while their employer recovers.

The pandemic relief Work-Sharing program runs until September 24, 2022, and the initial agreement entered into between the employer, employees, and Service Canada can run for a period of 76 weeks.

More information on eligibility criteria and the application process can be found on the federal government website at https://www.canada.ca/en/employment-social-development/services/work-sharing.html.

Tourism and Hospitality Recovery Program

Qualifying organizations (whether for-profit, not-for-profit, or charitable) which operate in the tourism, hospitality, arts, entertainment, or recreation sectors and have incurred significant revenue losses (at least 40% during the particular claim period) may be eligible for wage and/or rent subsidies for periods up to May 7, 2022.

Applications for such claim periods can be made up to 180 days after the end of the claim period. Consequently, as of July 30, 2022, applications can still be made for claim periods which began on or after January 16, 2022.

Detailed information on the program, including eligibility requirements and the application process (including application deadlines for each claim period), can be found on the federal government website at  https://www.canada.ca/en/revenue-agency/services/wage-rent-subsidies/tourism-hospitality-recovery-program.html.

Hardest-Hit Businesses Recovery Program

As the name implies the Hardest-Hit Businesses Recovery Program is targeted to entities – whether for profit, not-for-profit, or charitable – which have suffered a decline in revenues of at least 50% during a particular claim period. There are, as well, no restrictions on the economic or business sector which the particular applicant must be operating.

Under the Hardest-Hit Businesses Recovery Program, qualifying entities can receive both wage and rent supports. As with other business pandemic relief programs, claim periods under the HHBRP ended as of May 7, 2022. However, it is, as of the end of July 2022, possible to apply for benefits for any claim periods which began on or after January 16, 2022.

More information on the HHBRP is available on the federal government website at Hardest-Hit Business Recovery Program (HHBRP) - Canada.ca.

Canada Recovery Hiring Program

The Canada Recovery Hiring Program (CRHP) provides Canadian employers with a subsidy to cover a portion of wages for new employees or for wage or hour increases for existing employees.

As with other pandemic relief programs, the CRHP ended on May 7, 2022 but, as of the end of July 2022, applications can still be made for any claim periods which began on or after January 16, 2022.

More information on the CRHP can be found on the federal government website at Canada Recovery Hiring Program (CRHP) - Canada.ca.

Local Lockdown Program

In the earlier stages of the pandemic, lockdowns ordered by public health authorities were generally broad-based – often province-wide. Later, however, such lockdowns became more localized in nature, reflecting the pandemic conditions then prevailing in a particular region.

To address business losses resulting from such localized lockdowns, the federal government created the Local Lockdown Program. Essentially, under that Program, businesses, charities, and not-for-profit entities which were subject to a full or partial (for instance, capacity limits) public health restriction and incurred revenue losses of a specified percentage (which differs by claim period) may be eligible for wage and rent support through the Tourism and Hospitality Recovery Program (THRP). It’s important to note, however, that although such supports are being offered through the THRP, it is not necessary that the applicant be in the tourism, hospitality, arts, entertainment, or recreation sectors to be eligible for support.

Once again, the LLP ended on May 7, 2022, but applications under that Program can still be made for any claim periods which began on or after January 16, 2022. More information on the LLP is available at https://www.canada.ca/en/revenue-agency/services/wage-rent-subsidies/local-lockdown-program.html.

The sheer number and variety of pandemic relief programs offered by the federal and provincial governments at different times over the past two and a half years can make it difficult to follow just what supports are available to whom and for which time periods. Information on the current status of the major federal pandemic relief programs for businesses, including how the various programs interact and application deadlines for each claim period, is, however, always available on the federal government website at https://www.canada.ca/en/department-finance/economic-response-plan.html#financial_support.

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The information presented is only of a general nature, may omit many details and special rules, is current only as of its published date, and accordingly cannot be regarded as legal or tax advice. Please contact our office for more information on this subject and how it pertains to your specific tax or financial situation.