A 10% wage subsidy for SMEs and a tax deferral for all corporations until August 31 are the two key measures put forward by the Canadian government on Wednesday.
Ottawa is proposing to give small business employers a three-month wage subsidy for businesses that are experiencing revenue losses.
Businesses will be able to benefit immediately from this measure by reducing their income tax payments from the compensation of their employees.
The wage subsidy is for corporations eligible for the small business deduction as well as not-for-profit and charitable organizations.
Tax deferral
The federal government will allow small and large businesses to defer income tax payments until August 31, 2020. This relief would apply to the tax balance owing, as well as to instalments. No interest or penalty will apply to these amounts during this period.
In addition, the Canada Revenue Agency will not contact any small or medium-sized business to initiate post-caution audits of the GST/HST or income tax over the next four weeks.
