Coronavirus disease (COVID-19): Charities Directorate

As part of government actions taken in dealing with the effects of the COVID-19 pandemic, the Charities Directorate is extending the filing deadline to December 31, 2020, for all charities with a Form T3010, Registered Charity Information Return due between March 18, 2020 and December 31, 2020. This will allow charities more time to complete and submit their T3010, recognizing that charities will be focused on deploying their resources to address the effects of the COVID-19 virus situation.

The Charities Directorate has suspended all operations until further notice, which includes our call centre as well as all registration and audit activities. For information on operating a charity, you are encouraged to review the Charities and Giving webpage.

Charities are also encouraged to register for CRA’s secure online services. Through My Business Account, you can access the new digital services for charities.

Covid-19 Wage Subsidy Details for Businesses

1. What is the Temporary Wage Subsidy for Employers?

The Temporary Wage Subsidy for Employers is a three-month measure that will allow eligible employers to reduce the amount of payroll deductions required to be remitted to the Canada Revenue Agency (CRA).

2. Which employers are eligible?

You are an eligible employer if you:

  • are a non-profit organization, registered charity, or a Canadian-controlled private corporation (CCPC);
  • have an existing business number and payroll program account with the CRA on March 18, 2020; and
  • pay salary, wages, bonuses, or other remuneration to an employee.

Note: CCPCs are only eligible for the subsidy if their taxable capital employed in Canada for the preceding taxation year, calculated on an associated group basis, is less than $15 million.

The Temporary Wage Subsidy for Employers is limited to the eligible employers listed above.

3. How much is the subsidy?

The subsidy is equal to 10% of the remuneration you pay between March 18, 2020, and June 20, 2020, up to $1,375 per employee and to a maximum of $25,000 total per employer.

Associated CCPCs will not be required to share the maximum subsidy of $25,000 per employer.

For example, if you have 5 employees, the maximum subsidy you can receive is $6,875 ($1,375 x 5 employees), even though the per employer maximum is $25,000.

4. How do I calculate the subsidy?

The subsidy must be calculated manually.

For example, if you have 5 employees earning monthly salaries of $4,100 for a total monthly payroll of $20,500, the subsidy would be 10% of $20,500, or $2,050.

5. How will I receive the subsidy?

Once you have calculated your subsidy, you can reduce your current remittance of federal, provincial, or territorial income tax that you send to the CRA by the amount of the subsidy.Important: You cannot reduce your remittance of Canada Pension Plan contributions or Employment Insurance premiums.

For example, if you calculated a subsidy of $2,050, you would reduce your current remittance of federal, provincial, or territorial income tax by $2,050. You could continue reducing future income tax remittances, up to the maximum of $25,000, for all remuneration paid before June 20, 2020.

6. When can I start reducing remittances?

You can start reducing remittances of federal, provincial, or territorial income tax in the first remittance period that includes remuneration paid between March 18, 2020, and June 20, 2020.

For example, if you are a regular remitter, you can reduce your remittance that is due to the CRA on April 15, 2020.

7. What if subsidies exceed the remittances?

If the income taxes you deduct are not sufficient to offset the value of the subsidy in a specific period, you can reduce future remittances to benefit from the subsidy. This includes reducing remittances that may fall outside of the application period for the wage subsidy (after June 20, 2020).

For example: If you calculated a subsidy of $2,050 on remuneration paid between March 18, 2020, and June 20, 2020, but only deducted $1,050 of federal, provincial, or territorial income tax from your employees, you can reduce a future income tax remittance by $1,000, even if that remittance is in respect to remuneration paid after June 20, 2020.

8. Will the subsidy affect deductions from my employees?

No. You will continue deducting income tax, Canada Pension Plan contributions, and Employment Insurance premiums from salary, wages, bonuses, or other remuneration paid to your employees, as you currently do. The subsidy is only calculated when you remit these amounts to the CRA.

9. What if I don’t reduce remittances during the year?

If you are an eligible employer, but choose not to reduce your payroll remittances during the year, calculate the temporary wage subsidy on remuneration paid between March 18, 2020, and June 20, 2020. You can then ask for the subsidy to be paid to you at the end of the year, or transferred to the next year’s remittance.

10. What books and records do I need to support the subsidy?

You will need to keep information to support your subsidy calculation. This includes:

  • the total remuneration paid between March 18, 2020, and June 20, 2020;
  • the federal, provincial, or territorial income tax that was deducted from that remuneration; and
  • the number of employees paid in that period.

The CRA is currently updating reporting requirements. More information on how to report this subsidy will be released in the near future.

11. Is the subsidy considered taxable income?

Yes. If you receive the subsidy, you have to report the total amount as income in the year in which the subsidy is received.

12. What if my business is closed?

If you did not pay salary, wages, bonuses, or other remuneration to an employee between March 18, 2020, and June 20, 2020, you cannot receive the subsidy, even if you are an eligible employer.

COVID-19 Supports for Albertans

Emergency isolation support

  • Eligible working Albertans can receive a one-time emergency isolation support payment of $1,146 if they:
    • experienced total or significant loss of income as a result of having to self-isolate, or are the sole caregiver of a dependent who is self-isolating, and
    • have no other source of compensation, such as workplace sick leave benefits or federal employment insurance benefits

Utility payment deferral

  • Residential customers can defer electricity and natural gas bill payments for the next 90 days to ensure no one will be cut off, regardless of the service provider.
  • This program is available to Albertans who are experiencing financial hardship as a direct result of COVID-19. For example, those who have lost their employment or had to leave work to take care of an ill family member.
  • Call your utility provider directly to arrange for a 90-day deferral on all payments.

Learn more about the 90-day utility payment deferral (PDF, 128 KB)

Student loans repayment deferral

We are implementing a six-month, interest free, moratorium on Alberta student loan payments for all Albertans in the process of repaying these loans.

  • Alberta Student Loan repayments will be paused for 6 months, beginning March 30, 2020.
  • Interest will not accrue during this period. This mirrors the approach of the Canada Student Loans Program. This mirrors the approach of the Canada Student Loans Program.
  • Students do not need to apply for the repayment pause.
  • Borrowers may continue making payments during this period if they choose and this will not affect their eligibility to receive the benefit.

Banks and credit unions

ATB financial customers

  • Personal banking customers can apply for a deferral on their ATB loans, lines of credit and mortgages for up to 6 months.

Alberta Credit Unions

  • Credit union members will have access to a variety of programs and solutions designed to ease difficulties with loan payments and short-term cash flow.
  • Contact your credit union to work out a plan for your personal situation

Education property tax freeze

  • Residential education property tax rates will be frozen at last year’s level – reversing the 3.4% population and inflation increase added in Budget 2020.
  • This will save households $55 million.

Canada’s COVID-19 Economic Response Plan: Support for Canadians

Temporary Income Support for Workers and Parents

For Canadians without paid sick leave (or similar workplace accommodation) who are sick, quarantined or forced to stay home to care for children, the Government is:

  • Waiving the one-week waiting period for those individuals in imposed quarantine that claim Employment Insurance (EI) sickness benefits. This temporary measure is in effect as of March 15, 2020.
  • Waiving the requirement to provide a medical certificate to access EI sickness benefits.
  • Introducing the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks. This flat-payment Benefit would be administered through the Canada Revenue Agency (CRA) and provide income support to:
    • Workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits.
    • Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not quality for EI sickness benefits.
    • Parents with children who require care or supervision due to school closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.

Application for the Benefit will be available in April 2020, and require Canadians to attest that they meet the eligibility requirements. They will need to re-attest every two weeks to reconfirm their eligibility. Canadians will select one of three channels to apply for the Benefit:

  1. by accessing it on their CRA MyAccount secure portal at https://www.canada.ca/en/revenue-agency/services/e-services/e-services-individuals/account-individuals.html;
  2. by accessing it from their secure My Service Canada Account at https://www.canada.ca/en/services/benefits/ei/ei-regular-benefit/apply.html; or
  3. by calling 1-800-531-7555 or 1-800-206-7218 for an automated application process.

Longer-Term Income Support for Workers

For Canadians who lose their jobs or face reduced hours as a result of COVID’s impact, the Government is:

  • Introducing an Emergency Support Benefit delivered through the CRA to provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment.
  • Implementing the EI Work Sharing Program, which provides EI benefits to workers who agree to reduce their normal working hour as a result of developments beyond the control of their employers, by extending the eligibility of such agreements to 76 weeks, easing eligibility requirements, and streamlining the application process.

Income Support for Individuals Who Need It Most

For over 12 million low- and modest-income families, who may require additional help with their finances, the Government is proposing to provide a one-time special payment by early May 2020 through the Goods and Services Tax credit (GSTC). This will double the maximum annual GSTC payment amounts for the 2019-20 benefit year. The average boost to income for those benefitting from this measure will be close to $400 for single individuals and close to $600 for couples. This measure will inject $5.5 billion into the economy.

For over 3.5 million families with children, who may also require additional support, the Government is proposing to increase the maximum annual Canada Child Benefit (CCB) payment amounts, only for the 2019-20 benefit year, by $300 per child. The overall increase for families receiving CCB will be approximately $550 on average; these families will receive an extra $300 per child as part of their May payment. In total, this measure will deliver almost $2 billion in extra support.

Together, the proposed enhancements of the GSTC and CCB will give a single parent with two children and low to modest income nearly $1,500 in additional short-term support.

Canada’s COVID-19 Economic Response Plan: Support for Businesses

Extending the Work-Sharing program

The government is extending the maximum duration of the Work-Sharing program from 38 weeks to 76 weeks. The Work-Sharing program is offered to workers who agree to reduce their normal working hours because of developments beyond the control of their employers.

Apply to the Work-Sharing program


Providing small business with wage subsidies

The government announced an up to 75 per cent wage subsidy for qualifying businesses, for up to 3 months, retroactive to March 15, 2020. This will help businesses to keep and return workers to the payroll.

More details on eligibility criteria will start with the impact of COVID-19 on sales, and will be shared before the end of the month.

Access to credit

Establishing a Business Credit Availability Program

The government established a Business Credit Availability Program (BCAP) to provide $65 billion of additional support through the Business Development Bank of Canada (BDC) and Export Development Canada (EDC).

BDC and EDC are working with private sector lenders to coordinate on credit solutions for individual businesses, including in sectors such as oil and gas, air transportation, exportation and tourism.

This program includes:

Canada Emergency Business Account

The new Canada Emergency Business Account will provide interest-free loans of up to $40,000 to small businesses and not-for-profits, to help cover their operating costs during a period where their revenues have been temporarily reduced.

To qualify, these organizations will need to demonstrate they paid between $50,000 to $1 million in total payroll in 2019.

Loan Guarantee for Small and Medium-Sized Enterprises

EDC is working with financial institutions to issue new operating credit and cash flow term loans of up to $6.25 million to SMEs.

Co-Lending Program for Small and Medium-Sized Enterprises

BDC is working with financial institutions to co-lend term loans to SMEs for their operational cash flow requirements.

Eligible businesses may obtain incremental credit amounts of up to $6.25 million through the program.

These programs will roll out in the three weeks after March 27, and interested businesses should work with their current financial institutions.

Learn more about the Business Credit Availability Program

Support for farmers

Increasing credit available

The government is supporting Farm Credit Canada by allowing an additional $5 billion in lending capacity to producers, agribusinesses, and food processors. This will offer increased flexibility to farmers who face cashflow issues and to processors who are impacted by lost sales, helping them remain financially strong during this difficult time.

Learn more

Supporting financial stability

Launching an Insured Mortgage Purchase Program

The government launched an Insured Mortgage Purchase Program, in which the government will purchase up to $150 billion of insured mortgage pools through the Canada Mortgage and Housing Corporation.

This action will provide long-term stable funding to banks and mortgage lenders, help facilitate continued lending to Canadian consumers and businesses, and add liquidity to Canada’s mortgage market.

Learn more

Bank of Canada actions

The Bank of Canada is acting in several ways to support the economy and financial system and stands ready to take any and all actions that it can to protect the well-being of Canadians during this difficult time. The Bank has responded by lowering interest rates, intervening to support key financial markets and providing liquidity support for financial institutions.

Learn more

Lowering the Domestic Stability Buffer

The Office of the Superintendent of Financial Institutions announced it is lowering the Domestic Stability Buffer by 1.25% of risk-weighted assets. This action will allow Canada’s large banks to inject $300 billion of additional lending in to the economy.

More flexibility

More time to pay income taxes

The government is allowing all businesses to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after March 18 and before September 2020. This relief would apply to tax balances due, as well as instalments, under Part I of the Income Tax Act.

No interest or penalties will accumulate on these amounts during this period. 

Learn more

Deferral of Sales Tax Remittance and Customs Duty Payments

The government will allow businesses, including self-employed individuals, to defer until June 30, 2020 payments of the Goods and Services Tax / Harmonized Sales Tax (GST/HST), as well as customs duties owing on their imports.

The deferral will apply to GST/HST remittances for the February, March and April 2020 reporting periods for monthly filers; the January 1, 2020 through March 31, 2020 reporting period for quarterly filers; and for annual filers, the amounts collected and owing for their previous fiscal year and instalments of GST/HST in respect of the filer’s current fiscal year.

For GST and customs duty payments for imported goods, deferral will include amounts owing for March, April and May.

These amounts were normally due to be submitted to the Canada Revenue Agency and the Canada Border Services Agency as early as the end of this month.

Personal Tax Filing Deadline Extensions

In order to provide greater flexibility to Canadians who may be experiencing hardships during the COVID-19 outbreak, the Canada Revenue Agency will defer the filing due date for the 2019 tax returns of individuals, including certain trusts.

  • For individuals (other than trusts), the return filing due date will be deferred until June 1, 2020. However, the Canada Revenue Agency encourages individuals who expect to receive benefits under the GSTC or the Canada Child Benefit not to delay the filing of their return to ensure their entitlements for the 2020-21 benefit year are properly determined.
  • For trusts having a taxation year ending on December 31, 2019, the return filing due date will be deferred until May 1, 2020.

The Canada Revenue Agency will allow all taxpayers to defer, until after August 31, 2020, the payment of any income tax amounts that become owing on or after today and before September 2020. This relief would apply to tax balances due, as well as instalments, under Part I of the Income Tax Act. No interest or penalties will accumulate on these amounts during this period.

Taxes – Getting a Refund – Setting up Direct Deposit

Important Notice: Due to tax department security changes, for the 2019 personal tax filing, our office is no longer able to enter direct deposit information on behalf of our clients. If you have already signed up for direct deposit, the tax department will use the existing bank account information for any payments you are entitled to receive. Please see the information below on how to set up direct deposit and receive your refund.

How to sign up for Direct Deposit

Online

You can sign up yourself if you are registered for My Account. My Account can help you quickly and easily manage your tax affairs online, including signing up for direct deposit or changing your account information.

Online – mobile application

To start or update direct deposit information, use MyCRA.

Sign up through two financial institutions

Desjardins members and TD Canada Trust customers can now sign up for direct deposit through their financial institutions. Desjardins members can sign up online and TD Canada Trust members can sign up over the phone or in person at their branch.

By phone

To sign up for direct deposit or to change your account information, call 1-800-959-8281. You will need your:

  • social insurance number
  • full name and current address, including postal code
  • date of birth
  • most recent income tax and benefit return and information about the most recent payments you received from the Canada Revenue Agency
  • banking information: three-digit financial institution number, five-digit transit number, and your account number

By mail

To sign up for direct deposit, follow these steps:

  1. Fill out the Canada direct deposit enrolment form.
  2. Mail the completed form to the address on the form.

Note

Do not close your old bank account until your first payment has been deposited to your new bank account as it may already be in process.

GET READY, IT’S HERE – TIME TO FILE YOUR 2019 PERSONAL TAX RETURN

To help you gather your tax information for your 2019 return, please click the following link from our website to access our checklists and forms: 

https://seniuk.com/business-services/forms-and-checklists/

Once you have everything ready to go, please either drop off/mail the documents to our office or upload your documents to our secure client portal at:

https://ca.casewarecloud.com/seniuk/webapps/#login

If you have any questions or need any help, please contact our office at 780-482-3431 ext. 301 or 312 or email [email protected]

Thank you for your continued support. We look forward to hearing from you!

Are you buying a business? What are the tax implications?

Business number (BN), Payroll and Goods, and Services Tax (GST)

You may need a new BN. To find out, go to Business number registration.

To find out about payroll accounts and other related topics, go to Payroll overview.

You will want to review the relevant information on GST for the type of business you are buying at Register for a GST account.

Change of ownership

When the owner of a sole proprietorship or one of the partners in a partnership or one of the members of a corporation’s board of directors changes, it is important that you contact your tax services office.

Depending on your business structure, a change of owner(s) will have a different impact on your business. Your partnership agreement and whether or not your business was registered using the legal names of each partner or the provincially registered partnership operating name could require a legal name change, or the registration of a new Business number (BN) and program accounts with the CRA. For corporations, it is important that we have the correct name and social insurance number (SIN) of each director.

Value of the inventory and other assets

When you buy a business, you generally pay a set amount for the entire business. In some cases, the sale agreement sets out a price for each asset, a value for the inventory of the business and, if applicable, an amount that you can attribute to goodwill.

If the individual asset prices are set out in the sale agreement, and the prices are reasonable, then you should use these prices for claiming capital cost allowance (CCA).

If the individual asset prices are not set out in the contract, you have to determine how much of the purchase price you should attribute to each asset, how much to inventory and how much, if any, to goodwill. These amounts should coincide with the amounts the seller determined when reporting the sale. The amount you allocate to each asset should be its fair market value (FMV). You should allocate to goodwill the balance of the purchase price that remains after you allocate the FMV to each asset and to inventory.

Once you have determined the values for the assets and the goodwill, add the fixed assets (such as buildings and equipment) into the appropriate CCA classes. The goodwill is considered to be an eligible capital expenditure and is treated like assets eligible for CCA.

Treat the value of the inventory as a purchase of goods for resale, and include it in the cost of goods sold in your income statement at the end of the year.

For GST/HST purposes, if you buy a business or part of a business and acquire at least 90% of all of the property that can reasonably be regarded as necessary to carry on the business, you and the vendor may be able to jointly elect to have no GST apply to the sale by completing form GST44, Election Concerning the Acquisition of a Business or Part of a Business. You cannot make this election if the seller is a registrant but the buyer is not a registrant. In addition, you must buy all or substantially all of the property, and not only individual assets.

For the election to apply to the sale, you have to be able to continue to operate the business with the property acquired under the sale agreement. You have to file Form GST44, on or before the day you have to file the GST return for the first reporting period in which you would have otherwise had to pay GST on the purchase.

Even if you file the election, GST will still apply to:

  • a taxable supply of a service made by the seller
  • a taxable supply of property made by way of lease, licence, or similar arrangement
  • where the buyer is not a registrant, a taxable sale of real property

Another way of buying a business is to buy the shares of an incorporated business. This does not affect the cost base of the assets of the business. Since a corporation is a separate legal entity and it can own property in its own name, a change in the ownership of the shares will not affect the tax values of the assets owned by the corporation.

Generally, the purchase of shares of a corporation is not subject to GST.

Please contact our office if you require any help with your purchase or have any questions.

GST – How to complete and file a GST return

You can file a GST/HST return electronically, by TELEFILE, or on paper. Before you choose a method, you must determine if you are required to file online and which online method you can use.

For instructions about how to complete each line of your return, see Instructions for completing a GST/HST return.

GST/HST NETFILE is an online filing service that allows registrants to file their GST/HST returns and eligible rebates directly to the Canada Revenue Agency (CRA) over the internet.

My Business Account

My Business Account is a secure online portal that allows you to interact electronically with the CRA on various business accounts. Business accounts include GST/HST (except for GST/HST accounts administered by Revenu Québec), payroll, corporation income taxes, excise taxes, excise duties, and more.

Represent a client

Represent a Client is a service that provides you with secure and controlled online access to tax information on behalf of individuals and businesses, including your employer.

Electronic Data Interchange (EDI)

EDI lets you pay the net tax you owe electronically through a participating Canadian financial institution.

GST/HST TELEFILE

GST/HST TELEFILE is a fast, free, and easy-to-use filing option that allows qualifying registrants to file their GST/HST returns in a matter of minutes, using their touch-tone telephone and a toll-free number.

GST/HST Internet File Transfer

GST/HST Internet File Transfer is an internet-based filing service that allows eligible registrants to file their GST/HST returns directly to the CRA over the internet using their third-party accounting software.

Paper filing

If you are not required to file online, you may be eligible to file a paper return. To use this method, you can either mail your GST/HST return (GST34-2 or GST62) to the address on your return, or file in person at a participating financial institution.

You cannot file in person at a participating financial institution if:

  • you are claiming a refund
  • you are filing a nil return
  • you offset the amount owing on your return with a rebate or refund

Your personalized GST/HST return package

Each fiscal year, the CRA will mail you a personalized GST34-3 return package that includes:

  • an information sheet with your reporting periods and due dates
  • an access code for filing your returns electronically on GST/HST NETFILE or by phone using GST/HST TELEFILE
  • remittance vouchers to use if you make your payments at your financial institution

If you are filing electronically and make 2 consecutive electronic payments, the CRA will no longer send you an electronic filing package unless you request one.

If you file on paper, the CRA will send you the GST34-2 filing information package, which also includes personalized returns. You can use the access code provided in the package if you decided to start using GST/HST NETFILE or GST/HST TELEFILE.

If you need a new return package or access code, do one of the following:

  • to request a new GST34-2 or GST34-3, call the Business Enquiries phone line at 1-800-959-5525
  • to get a new access code for GST/HST NETFILE or GST/HST TELEFILE, go to GST/HST Access Code Online
  • to get a non-personalized version of the paper return (Form GST62), use the Order forms and publications

You can also register for My Business Account to view the due dates for your returns, make electronic payments or file your GST/HST returns without an access code.

View a previously filed GST/HST return

You may view the status and the details of a previously filed GST/HST return using My Business Account. You will also be able to view upcoming and overdue GST/HST returns by using the same online service.

GST/HST outreach seminars for non-profit organizations, charities, and similar organizations

GST/HST outreach seminars are informal presentations designed to help non-profit organizations, charities and similar organizations understand their GST/HST obligations and claim all eligible amounts to which they are entitled.

For more information and to register, see GST/HST Outreach Seminars for Non-Profit Organizations, Charities and Similar organizations.

Other GST/HST returns

Depending on your situation, you may have to file a different return. For more information, see: