Yesterday the Government of Canada announced a number of significant changes to personal and business taxation and support to individuals and businesses. This is quick summary. Details are not know in some cases. I will break this down into Filing Due Dates, Payment Due Dates, and Support for Individuals and Support for Businesses.
Filing Due Dates
The filing due date for person tax returns is now June 1st, moved from April 30th.
For the few clients that have a Trust or Estate returns that were due on March 31st it is now May 1st. For those proprietors that normally have a June 15th due date it is still due June 15th. For businesses that are GST/HST registered the filing dates have not been changed. Those with filing deadlines of March 31st remain. Any April 30th due dates remain. And no date extension have been announced for Employer Health Tax or WSIB premiums.
Payment Due Dates
For any income tax owing or instalments of income tax the payment due date is now September 1st. It is not clear to me if this date is actually correct. The documents released say the payment due date is after August. We will wait for the legislation to see for sure. Until that date CRA will charge no penalties and no interest on any payments. This only applies to income tax. It does not apply to HST, payroll source deductions, WSIB, EHT and other charges. Also, this only applies to Part I tax. For most of you that is just regular income tax. But for some of our corporate clients where your company may still owe amounts as soon as March 31st we will advise you directly. Please note that this is really just an interest free loan from the government. Once September 1st comes the funds are due and interest will be charged. So be careful borrowing from the government. Plan to pay amounts when they are due.
Support for Individuals
Anyone receiving a GST/HST will get an extra payment equal to the full year amount you are receiving in the 2019/20 year (expected in May). This is automatic. You do not need to apply. Anyone receiving Canada Child Benefit will receive an extra $300 per child. This is also automatic.
The are new enhanced EI benefits. This applies to both employees and self-employed. First thing to know is this does not replace regular EI. So if you become unemployed apply for benefits as usual. The new benefit only applies in cases where you have been unable to work due to contracting Covid-19, caring for someone, looking after your children, self-isolating or lost income due to not being able to work and not being eligible for regular EI. The application for this will be primarily through your CRA MyAccount. You cannot apply until April (date not specified). So if you do not have access to your CRA account I encourage you to get that set up. Applying for this benefit is not something my firm will be able to do for you.
Student loan interest and payment are suspended for six months.
RRIF minimum withdrawals are reduced by 25%.
Support for Business
For the next three months (dates to be clarified in the legislation) there will be a 10% wage subsidy. This is to a maximum of $1,375 per employee and $25,000 per business. There will not be any actual money from the government. Employers will simple reduce withhold tax remittances. How this works in practice is unknown. Hopefully, by April 15th we will learn how to actually do this. Other than this there are new or enhanced programs to help business borrow money. But that has to be paid back so be cautious in borrowing more money.
Throughout this situation we remain open but are limiting personal contact. Documents can be dropped off. We can work remotely when needed and will assist you as best we can.