Canada Emergency Business Account (CEBA)

This federal program allows small businesses and non-profit organizations to obtain interest-free loans of $60,000 to help them with operating costs at a time when their income is temporarily lower. Thirty-three per cent (33%) of the loan amount ($20,000) may be forgiven as long as the business pays back $40,000 on or before December 31, 2022. If the business cannot pay back the loan by December 31, 2022, it can be converted into a three-year term loan at an interest rate of 5%. The loan must be repaid on or before December 31, 2025.

Here are the details regarding the new criteria:

Option 1 (criteria that remains in effect):
The Borrower's total employment income paid in the 2019 calendar year was between $20,000 and $1.5 million.

Option 2 (extended criteria):
Companies with $20,000 and less in total employment income paid in the 2019 calendar year:

• The Borrower has a Canada Revenue Agency business number and has filed a 2018 or 2019 tax return.
• The Borrower has eligible non-deferrable expenses between $40,000 and $1.5 million. Eligible non-deferrable expenses could include costs such as rent, property taxes, utilities, and insurance. Expenses will be subject to verification and audit by the Government of Canada.
• Complete the loan request on the government website in order to enter the details of the eligible non-deferrable expenses and upload supporting documents.

To qualify, businesses must meet the following requirements:

• Be a Canadian business in operation on March 1, 2020.
• Be registered for federal tax.
• Have an active business chequing/operating account with UNI.
• Have UNI as its primary financial institution.
• Not have previously used or applied to the Program at any other financial institution.
• Acknowledges its intention to continue to operate its business or to resume operations.
• The Borrower agrees to participate in post-funding surveys conducted by GOC and agrees that relevant contact information of the Borrower can be shared with the GOC for that purpose.
• Option 1: Demonstrate that the company's total payroll was between $20,000 and $1.5 million in the 2019 calendar year (this information is available on your business's "T4 Summary of Remuneration Paid").
• Option 2: Applicants with $20,000 and less in total employment income paid in the 2019 calendar year must meet the following new criteria:
  • The Borrower has a Canada Revenue Agency business number and has filed a 2018 or 2019 tax return.
  • The Borrower has eligible non-deferrable expenses between $40,000 and $1.5 million Eligible non-deferrable expenses could include costs such as rent, property taxes, utilities, and insurance. Expenses will be subject to verification and audit by the Government of Canada.

The eligibility criteria were provided to us by the government and cannot be adjusted by UNI. Validation of eligibility depends on criteria defined by the Government of Canada. None of the organizations administering this program, including your financial institution, have the power to grant exceptions.

Businesses that do not qualify include:

• Government organizations or bodies, or entities owned by a government organization or body;
• Non-profit organization, registered charity, union, or a fraternal benefit society or order, or an entity owned by such an organization, unless the entity is actively carrying on a business in Canada (including a related business in the case of a registered charity) that earns revenue from the regular supply of property/goods or services;
• Entity owned by any Federal Member of the Parliament of Canada or Senator of the Parliament Canada.

Eligible business does not promote violence, incite hatred or discriminate on the basis of sex, gender identity or expression, sexual orientation, colour, race, ethnic or national origin, religion, age or mental or physical disability, contrary to applicable laws.

It is defined as eligible expenses for which the business cannot extend the payment due date after December 31, 2020. Non-deferral expenses must be incurred with a supplier of goods and services before March 1, 2020.

Eligible expenses are:

• wages and other employment expenses to independent (arm's length) third parties;
• rent or lease payments for real estate used for business purposes;
• rent or lease payments for capital equipment used for business purposes;
• payments incurred for insurance related costs;
• payments incurred for property taxes;
• payments incurred for business purposes for telephone and utilities in the form of gas, oil, electricity, water and Internet;
• payments for regularly scheduled debt service;
• payments incurred under agreements with independent contractors and fees required in order to maintain licenses, authorizations or permissions necessary to conduct business by the Borrower; and
• any other expense in a category other than the above as may be indicated by GOC under the Web Page from time to time as being an Eligible Non-Deferrable Expense for the purpose of the Program.

Companies will have until June 30, 2021 to apply for a loan request.

The requirements of the program, as set out by the Government of Canada, are relatively strict about it. The requirements state that funds from this loan may only be used to pay for operating costs that cannot be deferred, such as payroll, rent, utilities, regularly scheduled debt service, insurance, and property tax. They cannot be used to reimburse or refinance a payment or expenses such as an existing debt or to pay dividends, and they cannot be used for distribution purposes or to increase management compensation.

Only online applications on the UNI.ca website will be accepted. No applications can be made in person or by phone.

UNI's payment deferral program and other government relief programs are unrelated. Companies can therefore apply to each of the programs, provided they meet the eligibility criteria.

The information required differs depending on the business eligibility option and the type of the business.

Option 1: Based on the 2019 payroll

You will need to have the following information available when you are ready to start your application:

• Your 2019 "T4 Summary of Remuneration Paid" document (confirmation that your payroll totalled between $20,000 and $1.5 million in 2019)
• Your 15-digit employer number, available on the T4 SUM.
• A check from your business check/operation account or the latest statement indicating the transit and folio number.

Option 2: Based on Eligible Non-Deferrable Expenses in 2020

If the business is a:

• Incorporated business (corporation / canadian-controlled private corporation):

  You will need to have the following information available when you are ready to start your application:

  • Your CRA Business Number (BN) (9 digits)
  • Amount reported on line 400 of the Borrower's latest T2
  • The transit number and the folio number of your business account with UNI.

• Partnership or unincorporated business:

  You will need to have the following information available when you are ready to start your application:

  • Your CRA Business Number (BN) (9 digits)
  • Amount reported on the latest T1:
    • Field 13500 for 2019 or 135 for 2018 (net business income)
    • Field 13700 for 2019 or 137 for 2018 (net professional income)
    • Field 13900 for 2019 or 139 for 2018 (net commission income)
    • Field 14100 for 2019 or 141 for 2018 (net farming income)
    • Field 14300 for 2019 or 143 for 2018 (net fishing income)
  • The transit number and the folio number of your business account with UNI.

Option 1: Based on the 2019 payroll

For companies using this option, the number required is the one appearing on the T4 SUM. See image below.

Option 2 : Based on Eligible Non-Deferrable Expenses in 2020

The CRA business number has 9 digits and is generally available on the following documents:

• Field 001 of the T2 Tax report
• Business's Notice of assessement
• GST/HST Report
• T4SUM
• CRA "My Business account"
  

Yes, you are eligible, but you will need to open a business account with UNI. Please click here for opening a business account for CEBA.

No, this is not possible. The eligibility criteria were provided to us by the government and cannot be adjusted by UNI. None of the organization administrating this program, including UNI, have the authority to grant exceptions.

An e-mail confirming that your application has been received will be sent to you as soon as the application is entered into our systems.

The Canada Revenue Agency (CRA) has recently taken a position on this issue and has indicated that the amount eligible for a capital exemption is taxable in the year in which the loan is received. If the balance of a CEBA loan is not repaid by December 31, 2022, an offsetting deduction is available for the tax year in which the amount is repaid. To ensure you comply with the CRA's tax treatment for your company's income tax return, we recommend contacting your chartered professional accountant or tax advisor.

Yes, if your business meets the eligibility criteria, including the amount paid in salaries during 2019 (a total between $20,000 and $1.5 million). This information is included on the "T4 Summary of Remuneration Paid."

Application can be made, for the option 1 (Based on the 2019 payroll) providing your business can produce a "T4 Summary of Remuneration Paid" showing a total payroll in 2019 between $20,000 and $1.5 million.

Application can be made once for each of your businesses that meet the Canada Emergency Business Account eligibility criteria, and must be done through their primary financial institution.

The Canada Emergency Business Account is a government program that is not designed to address every situation. Eligibility criteria are provided to us by the government and cannot be adjusted by UNI.

Government assistance measures change regularly. We recommend that you regularly consult the information posted on the UNI.ca and/or Government of Canada websites.