What the Latest COVID-19 Policy Changes Mean for Your Wallet

The federal government is releasing rapid-fire policy changes and updates in an effort to meet the needs of Canadians during the pandemic. Below we summarize some of the key measures for core groups.

Individuals and families

• Emergency response benefit: The taxable Canada Emergency Response Benefit will provide $2,000 a month for up to four months to eligible individuals who must stop working due to COVID-19; those who are sick, quarantined or taking care of someone who is sick with the virus, for example, as well as working parents who must stay home without pay because of school and daycare closures during the pandemic. The application portal opened April 6 on a staggered schedule based on applicants' birth months.
• Reduced RRIF minimum: The required minimum withdrawal from RRIFs (Registered Retirement Income Funds) has been reduced by 25 per cent for 2020.
• Additional Goods and Services Tax Credit: A one-time special payment will start in April 2020 for low- and modest-income families. This payment will be made automatically; eligible individuals aren't required to apply.
• Additional Canada Child Benefit: There will be a one-time additional payment in May 2020 of $300 per child for those who qualify.
• Improved access to EI sickness benefits: The government has temporarily waived the medical certificate requirement for those who are in quarantine or have been directed to self-isolate and claim EI (employment insurance) sickness benefits.
• Student loan suspension: All Canada Student Loan and Canada Apprentice Loan repayments have been automatically suspended until Sept. 30, 2020 interest-free.
• Tax-filing extension: Individuals now have until June 1, 2020 to file their 2019 income tax returns. Self-employed individuals continue to have until June 15, 2020.

Small- and medium-sized businesses

• Wage subsidy: For businesses whose revenue has taken a 30 per cent or more hit as a result of the COVID-19 pandemic, under the Canada Emergency Wage Subsidy, the government is proposing to provide a 75-per-cent wage subsidy to eligible employers for up to three months, retroactive to March 15, 2020.
• Credit availability: Three programs, funded through the Business Development Bank (BDC) and Export Development Canada (EDC), are being put in place to provide $65 billion to meet the credit needs of businesses.
  • The Canada Emergency Business Account is to provide interest-free loans of up to $40,000 to small businesses. Repaying the balance of the loan on or before December 31, 2022 will result in loan forgiveness of 25 per cent up to $10,000.
  • The EDC Business Credit Availability Program is providing an 80 per cent guarantee of new operating credit and cash flow term loans up to $6.25 million to small- and medium-sized businesses, to be repaid within one year.
  • Through the BDC Co-Lending Program, the BDC will provide 80 percent of loans supporting businesses' operational cash flow requirements (with the remaining 20 per cent provided by a financial institution) up to a total of $6.25 million.
• GST/HST remittance deferral: The federal government is proposing to defer certain GST (Goods and Services Tax) and HST (Harmonized Sales Tax) remittances. Note that the Quebec government has postponed the filing deadline for the QST (Quebec Sales Tax) return and the payment of the March, April and May QST remittances to June 30, 2020.
• Customs duty payments deferral: Payments owing for customs duties (typically paid monthly) for the months of March, April and May have been deferred to June 30, 2020.
• Tax-filing relief: Businesses can defer, until after Aug. 31, 2020, the payment of income tax amounts that were owed on or after March 18 and before September 2020.

For additional information regarding eligibility and enrollment criteria, read Canada's COVID-19 Economic Response Plan on the Government of Canada website (www.canada.ca/en/department-finance/economic-response-plan.html).

For a roundup of coronavirus coverage, plus timely reminders and tools that can help when markets are volatile, click here.