Ottawa is expanding the small business loan program for COVID-affected companies, Prime Minister Justin Trudeau announced Tuesday (May 19).
The Canada Emergency Business Account will now accept applications from sole proprietorships and businesses that pay family members through dividends or employ contractors.
Trudeau said the expanded criteria would apply to everyone from hair salons that rent out chairs to stylists to gym owners who employ contracted changes.
The CEBA program give qualifying businesses that have been affected by COVID-19 loans of up to $40,000. The loans are interest-free and can be partially forgiven.
To qualify under the new criteria, applicants with payroll lower than $20,000 need:
- a business operating account at a participating financial institution
- a Canada Revenue Agency business number, and to have filed a 2018 or 2019 tax return
- 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.
Trudeau said his government is looking at expanding the program to business owners who use their personal bank accounts or have yet to file a tax return because they are a new business.
In a statement, Courtenay-Alberni MP Gord Johns said while this announcement was welcome, it could be too little too late for many small businesses. The NDP MP also called for Trudeau to release more details on the Canada Emergency Commercial Rent Assistance Program, which was announced last month. The federal government said the program could be operational by mid-May.
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