Canada: Extended, expanded wage subsidy (COVID-19)

Canada: Extended, expanded wage subsidy (COVID-19)

Certain employers may now be able to receive the “emergency response” wage subsidy for an extended period of time under pending legislation. The wage subsidy is a program intended to provide relief in response to the coronavirus (COVID-19) pandemic.


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The government has proposed changes to the wage subsidy—including new measures to expand the eligibility to employers that do not meet the previous 30% revenue threshold and to replace the subsidy with a new two-part subsidy consisting of a "base" and "top-up" amount.

Under these measures, the amount of the wage subsidy that an eligible employer could qualify for would vary depending on the employer’s revenue decline, with a maximum combined subsidy of up to 85% of eligible remuneration. These proposals are generally intended to apply beginning with the current July reporting period.

The draft legislation also:

  • Contains changes that provide continuity rules for employers that have recently purchased assets of a business
  • Provides an appeal process for the wage subsidy
  • Extends the subsidy application deadline

The legislative proposals also include previously announced measures for the subsidy affecting employers with a paymaster arrangement, amalgamated corporations, tax-exempt trusts, and seasonal employees. The draft legislation further includes previously tabled measures to allow the government to temporarily extend or suspend certain federal statutory deadlines and time limits up to 31 December 2020.

Read a July 2020 report [PDF 223 KB] prepared by the KPMG member firm in Canada

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