Beginning April 27, 2020, applications for the Canada Emergency Wage Subsidy (“CEWS”) will be open for eligible employers. We previously discussed the CEWS on our blog, including eligibility requirements, here and here.
Eligible employers wishing to apply for the CEWS should take the following preparatory steps to ensure a smooth application process.
- Register Now for the Canada Revenue Agency’s My Business Account
Eligible employers will be able to apply for the CEWS using Canada Revenue Agency’s My Business Account. Employers should register for their My Business Account now to ensure they can apply for the CEWS as soon as applications are open. Business can register for My Business Account here. Employees or representatives of a business can access an account on behalf of their employers or business clients here.
As an alternative, employers will be able to apply for the CEWS using a separate online application form, which will be made available on April 27. To use this form, employers must ensure they have an online web access code. The online web access code can be obtained here.
- Ensure Employer Information is Up to Date
Eligible employers must ensure their business details and direct deposit information for their payroll accounts are up to date and accurate. Keeping this information up to date will ensure that any payments made to the employer will be processed efficiently.
- Calculate Estimated Wage Subsidy Prior to Applying
Prior to applying for the CEWS, employers must calculate the estimated wage subsidy they expect to receive for their business. An online guide to calculating the estimated wage subsidy, as well as an online calculator, can be accessed here.
- Where Large Payments of $25 million or More Are Expected
Employers who are expecting to receive a wage subsidy of $25 million or more must receive their payment through the large value transfer system (“LVTS”). To receive payments through the LVTS, employers must be enrolled in direct deposit on their payroll account and be registered for the LVTS. A guide on how employers can register for the LVTS can be found here.
Businesses must ensure they are eligible for the CEWS before they apply for it. Businesses who do not meet the CEWS eligibility requirements for a qualifying period but nonetheless apply for the CEWS will be required to repay any amounts they receive for that period. Employers must not artificially reduce their revenue for the purpose of applying for the CEWS – those who do so will be required to repay any amounts received and will be subject to a penalty equal to 25% of the total value received.
Our firm will continue to provide you with updates as the Federal Government’s response to the COVID-19 pandemic evolves.
The foregoing is for informational purposes only and should in no way be relied upon as legal advice. For legal advice tailored to your circumstances and business, please contact any of SOM LLP’s lawyers by email or telephone.