Share with your friends

Canada: Adjustments to wage subsidy program (COVID-19)

Canada: Adjustments to wage subsidy program (COVID-19)

The Department of Finance released details of additional proposed changes to the Canada emergency wage subsidy (CEWS)—established as a relief program in response to the coronavirus (COVID-19) pandemic.


Related content

The CEWS program is a temporary subsidy that is available from 15 March 2020 until June 2021. Currently, the CEWS provides a two-part subsidy consisting of a "base" and a "top-up" amount. The amount of the wage subsidy an eligible employer could qualify for varies, based on the decline of qualifying revenue during the COVID-19 pandemic, with a current maximum combined subsidy of 65% of eligible wages until 19 December 2020. The Canadian government continues to adjust the CEWS to simplify the revenue-decline test and to change the treatment of furloughed employees.

Finance stated that it will:

  • Harmonize the revenue-decline test for the base subsidy and the top-up subsidy starting 27 September 2020
  • Align the wage subsidy for furloughed employees with employment insurance (EI) benefits, beginning 25 October 2020

Finance recently announced that the CEWS would be extended to June 2021; however, further details of the CEWS for these additional periods, including details on eligibility, are not yet available.

Finance also advised that the 40% base and 25% maximum top-up that applies for the period 27 September 2020 to 24 October 2020 will continue to apply from 25 October 2020 to 19 December 2020. This confirms Finance's previous announcement that the current maximum 65% subsidy would be retained for this period.

Read an October 2020 report prepared by the KPMG member firm in Canada 

The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

Connect with us


Want to do business with KPMG?


loading image Request for proposal