COVID-19 General Update
TAX ALERT – Response to COVID-19
The government of Canada has implemented several measures to assist individuals and businesses in these unprecedented times. The official response plan can be found at https://www.canada.ca/en/department-finance/economic-response-plan.html. All information in this letter is current as of today. We will try to pass on new information as updates are available.
Tax Filing Deadlines
Individuals: The deadline for filing personal income tax returns is postponed from April 30, 2020, to June 1, 2020. There is no change to the filing deadline of June 15, 2020 for self-employed individuals.
Businesses: The deadline for filing your corporate income tax return continues to be six months after the year-end.
Estates/Trusts: The deadline for filing an estate or trust income tax return has been postponed from March 30, 2020, to May 1, 2020.
Income Tax Amounts Owing
All Taxpayers: Any income tax balances or instalments that become owing on or after March 18, 2020, can be deferred until after August 31, 2020. This relief would apply to income tax balances due, as well as instalments. No interest or penalties will accumulate on these amounts during this period.
To clarify, if you had an amount owing before March 18, 2020, those amounts will not qualify for this deferral.
What Does This Mean?
Although these announcements provide welcome relief from the rapidly approaching filing deadlines, it does not mean we should delay the preparation and filing of your tax returns, especially individuals who anticipate a tax refund. Benefits such as the GST/HST credit, Canada Child Benefit, Ontario Trillium Benefit, etc. could be delayed if you file your tax return after the normal filing date. We encourage you to file your return by the original deadline, if possible.
The government of Canada has also introduced measures to assist individuals who’s work hours have been reduced or eliminated due to recent events. Details remain sparse at this time, but you can get information and apply online: https://www.canada.ca/en/services/benefits/ei.html
- The Emergency Care Benefit (must re-attest to eligibility every 2 weeks) will provide up to $900 bi-weekly for up to 15 weeks to provide income support to:
- Workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits.
- Workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not qualify for EI sickness benefits.
- Parents with children who require care or supervision due to school or daycare closures, and are unable to earn employment income, irrespective of whether they qualify for EI or not.
- The Emergency Support Benefit will support workers who are not eligible for EI and who are facing unemployment. Workers not eligible for EI are typically self-employed individuals
- The EI Work Sharing Program provides EI benefits to workers who agree to reduce their normal working hours as a result of developments beyond the control of their employers. The eligibility requirements for this benefit was eased and the application process was streamlined.
- Employment Insurance changes include:
- waiving the one-week waiting period;
- Waiving requirement to provide a medical certificate to access EI sickness benefits
- Increased benefits for GST/HST credit and Canada Child Benefit
- Six-month (interest-free) moratorium on the repayment of Canada Student Loans
- Reducing the required minimum withdrawals from RRIF’s by 25% for 2020
- Support for Canadian exporters through the Canada Account
- Temporary wage subsidies for small businesses for a period of three months.
- CRA will temporarily accept electronic signatures on the T183 and T183Corp forms. Presumably, this includes DocuSign and similar software services.
As a result of recent developments, please consider the delivery of files and documents electronically rather than physical visits or mail. We have various electronic options. Please contact our office via email or telephone message. We will continue to provide you with updates as new information becomes available.
We look forward to hearing from you. Be safe.
Colin, Tyler, Humberto, and Sharon
The Team at Colin Phillips, CPA Professional Corporation