Canada enacts wage subsidy extension and enhancements

Canada enacts wage subsidy extension and enhancements

Employers should be aware of new changes to the Canada Emergency Wage Subsidy.

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Canada's government has now enacted legislation to extend and enhance this temporary subsidy, which is available to qualifying employers that have lost revenue due to COVID-19. The legislation, which was passed into law on July 27, 2020, extends the subsidy to November 21, 2020 (although the government has said the subsidy will continue until December 19, 2020), changes the subsidy to expand the eligibility to employers who do not meet the previous 30% revenue threshold and modifies the calculation so that the subsidy now consists of a "base" and "top-up" amount.

Among other measures, the new changes also include new continuity rules for employers that have recently purchased assets of a business, and certain outstanding subsidy proposals. Full details of these measures are available in TaxNewsFlash-Canada 2020-62, "Canada Further Extends and Expands Wage Subsidy".

Now that these new rules have been passed into law, employers can complete their subsidy claims in accordance with these changes. In particular, eligible amalgamated corporations and employers with paymaster arrangements, among others, will be able to submit subsidy claims. Previously, the CRA indicated it would not administer these changes until they were passed into legislation.

Download this edition of the TaxNewsFlash to learn more.

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