Guide to COVID-19 Relief for Small Businesses

The financial impact of the global COVID-19 pandemic on Canadian small business has been enormous, and it’s still ongoing. If you own a small business anywhere in Canada, you’ve no doubt been affected in some way. While the hard times are far from over, help is coming from the Canadian government and several of Canada’s largest financial institutions. But with the situation evolving ever so rapidly, it can be difficult to stay on top of the relief measures announced for small businesses. In this article, I’ll let you know what’s available so far, and where you can go to find the help you need. 

The Canada Emergency Business Account (CEBA) 

On March 27th, the Government of Canada announced a $40,000 emergency line of credit, available to qualifying small and medium-sized businesses impacted by COVID-19. This loan is designed to provide businesses with access to capital, helping them to cover operating costs during the ongoing crisis. CEBA account applications will be available through digital channels at all major Canadian banks as early as April 6th. While the federal government is partnering with the big banks to deliver this product as quickly and efficiently as possible, the loan is fully guaranteed and funded by the Government of Canada. 


  • $40,000 business line of credit 
  • Guaranteed and funded by Government of Canada 
  • No minimum monthly payments required until December 31st, 2022
  • Prepayments of principal can be made at anytime 
  • No interest until Dec. 31, 2022 
  • If balance is paid in full prior to Dec. 31, 2022, $10,000 loan forgiveness is available. 

Summary of Eligibility 

  • Individual applying must be authorized to borrow on behalf of the business 
  • Must have had an active business account on March 1st, 2020 
  • Holding companies are ineligible 
  • 2019 payroll expense must be between $50,000 and $1 million 
  • Maximum 1 application per business 
  • Loan funds must be used to cover regular operating expenses ie. rent, payroll, utilities, insurance etc. 

Canada Emergency Wage Subsidy (CEWS) 

For businesses faced with a sharp decline in revenue due to COVID-19 – 30% or more vs. the same time period in 2019 – the Canadian government has created a 75% wage subsidy. The Canada Emergency Wage Subsidy (CEWS) will cover 75% of the first $58,700 earned, up to $44,025 per employee. There is no limit to the number of employees who can be included in the program. 

This is a temporary measure which will initially be in place for 12 weeks, between March 15th and June 6, 2020. The government has said that they will continue to monitor the situation, and provide more guidance as the COVID-19 crisis unfolds. Employees covered by the CEWS subsidy will be able to stay off of Employment Insurance (EI) Benefits, as well as the recently announced Canada Emergency Response Benefit (CERB) of $2,000/month. 


  • 75% emergency wage subsidy for qualifying businesses 
  • Benefit of up to $847 per week, per employee, for duration of program
  • Initial duration is for 12 weeks, between March 15th and June 6th, 2020 
  • Funds must be used to maintain or re-hire workforce 

Summary of Eligibility 

  • Does not cover severance pay, stock option benefits, or the personal use of a corporate vehicle
  • Eligible employers will need to reapply for the subsidy on a monthly basis 
  • Applications will be made through CRA My Business Account, with a web-based application to follow in the coming weeks. 
  • Subsidy will be for funds actually paid to employees, eligible businesses will be reimbursed

Export Development Canada Business Credit Availability Program (BCAP) 

While details have yet to be announced, Export Development Canada (EDC) has partnered with financial institutions across Canada to support businesses impacted by COVID-19. This partnership will come mainly in the guarantee of loans provided by banks to small businesses, with the purpose of freeing up crucial operating capital. Up to $6.2MM of funding will be available to qualifying Canadian businesses. As per the EDC website, application details will be announced in the coming weeks. 

Business Development Canada (BDC) Co-Lending Program 

Another program with details yet to be finalized will come from Business Development Canada (BDC). This will be a co-lending program, signifying a partnership between BDC and several Canadian financial institutions. Features of the financing include 12 months of interest-only payments, while the amount of available financing will vary, depending upon the revenues of individual businesses. BDC recommends that interested parties get in touch with their primary financial institution to find out exactly when the program will be launched.

CRA Income Tax Deadline Extension for Small Business

Due to COVID-19, CRA has moved the tax deadline for small businesses to pay their 2019 income taxes to September 2020. At the time of this writing, an exact due date has not been announced. Keep in mind that taxes must still be filed by June 15th, 2020, however, there will be no penalties charged on amounts owing prior to September. 

Other COVID-19 Relief Options – Speak With Your Financial Institution 

In addition to the COVID-19 relief measures announced by the Canadian government, several of Canada’s major banks have taken steps to protect their existing small business banking customers. For example, TD Canada Trust has announced a deferral option of up to 4 months on small business term loans, and 6 months on real estate secured business term loans, while RBC has offered payment deferrals, as well as fee waivers on a case by case basis. 

Other potential relief options include the reduction of interest on major credit cards and increases to credit limits for qualifying businesses. All Canadian banks are encouraging their small businesses clients to reach out to them directly to find out what’s available. 

What If My Business Doesn’t Qualify for Relief? 

Unfortunately, it will be impossible for the government to ensure that  COVID-19 relief measures protect every small business in Canada. Undoubtedly, there will be those who fall through the cracks. As someone who runs an online business, I think of the many people I know who make money online, as ‘solopreneurs’. They may not qualify for wage relief or a large business loan, yet their means of making an income may be severely impacted by COVID-19. 

If you own a small business, and you’re concerned about how COVID-19 will affect you, I recommend that you first reach out to a small business advisor where you bank. There may be ways that they can help that haven’t been outlined in this article. Failing that, remember that there is also help available for individuals and families. If you have a personal mortgage, you may qualify to have your payments deferred by up to 6 months, and recently, interest reductions have been applied to major credit cards for affected customers. At this time, any help is more than welcome. 

Tom Drake is the founder of the award-winning MapleMoney, a personal finance site dedicated to helping Canadians create lasting financial freedom. He also has a podcast, The MapleMoney Show, which covers a new topic every week and brings on an expert to dive deep into what you need to know.

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