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The federal government has announced that its updated application process for the Canada Business Emergency Account (CEBA) will open on Friday, June 19. This means that some businesses that were not eligible for the program will become eligible this week.
The CEBA will soon be open to sole proprietorships and companies that use subcontractors or receive payment in the form of dividends.
The CEBA is a COVID-19 relief program aimed at helping businesses access loans to cover the costs of keeping their business afloat during the pandemic. Prime Minister Justin Trudeau announced at a press briefing in May that eligibility for the program would be expanded to include sole proprietorships, farmers, and businesses that use contractors or pay themselves in the form dividends.
To qualify under the expanded eligibility rules, CEBA applicants with a payroll of less than $ 20,000 will need a business operating account at a participating financial institution, from the Canada Revenue Agency, from a 2018 or 2019 income tax return. They must also have eligible non-reportable expenses between $ 40,000 and $ 1.5 million.
The federal program offers loans of $ 40,000 guaranteed by the federal government, interest-free in the first year. If the recipient can repay the loan balance by the end of 2022, up to $ 10,000 (25% of the loan) will be forgiven.
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The CEBA is a $ 55 billion program, and is available to private sector companies and nonprofit organizations. Businesses should apply for CEBA through their financial institutions to help cover operating costs during the crisis. The CEBA is offered by Export Development Canada, which works with Canadian financial institutions, including banks and credit unions, to provide loans.
In May, Trudeau said more than 600,000 small businesses had accessed CEBA, representing more than $ 24 billion in credit. The prime minister did not provide updated figures on the CEBA in his Monday briefing.
Trudeau said more information on CEBA’s updated eligibility criteria will be released in the coming days.
Image source Unsplash. Photo by Christina – wocintechchat.com.
