The Government of Canada announced that they are taking immediate, significant and decisive action to help Canadians that are impacted by the COVID-19 outbreak.
As part of this plan, they are providing flexibility to individuals, trusts, and businesses with regards to tax filing deadlines and payments.
The tax return filing deadline has been deferred until June 1, 2020. However, the Agency encourages individuals who expect to receive benefits to not delay the filing of their return in order to ensure their entitlements are properly determined.
The CRA will also allow taxpayers to defer the payment of any income tax amount owing to after August 31, 2020. This relief not only applies to tax balances due on the filing of the tax return but also to any installment payments. No interest or penalties will accumulate on these amounts during this period.
In order to help reduce the necessity for taxpayers and tax preparers to meet in person during this difficult time, the CRA will, effective immediately, recognize electronic signatures as having met the signature requirements of the Income Tax Act as a temporary administrative measure.
Trusts having a taxation year ending on December 31, 2019, the return filing due date will be deferred until May 1, 2020.
The CRA will allow all businesses to defer the payment of any income tax amount owing to after August 31, 2020. This relief not only applies to tax balances due on the filing of the tax return but also to any installment payments. No interest or penalties will accumulate on these amounts during this period.
To support businesses that are facing revenue losses and to help prevent layoffs, the government is proposing to provide eligible small employers a temporary wage subsidy for a period of three months. The subsidy will be equal to 10% of remuneration paid during that period, up to a maximum subsidy of $1,375 per employee and $25,000 per employer. Businesses will be able to benefit immediately from this support by reducing their remittances of income tax withheld on their employees’ remuneration. Employers benefiting from this measure will include corporations eligible for the small business deduction, as well as non-profit organizations and charities.
For full details of the Government of Canada’s Economic Response Plan see the government’s website at: https://www.canada.ca/en/department-finance/economic-response-plan.html .
What are we doing at McCay Duff?
We have been actively monitoring and reacting to the developing Coronavirus (COVID-19) pandemic. As we focus on this issue, our top priority is ensuring the health and safety of our people, clients and our community while minimizing business disruptions. Our significant investment in technology provides us the ability to work remotely while continuing to deliver the highest level of service. We are ready and available to prepare personal tax returns and encourage our clients to send us information as it is available. We are here to help our clients as we all work through these challenging times.
Our thoughts go out to all health professionals and all those who are on the front lines combatting this pandemic.
If you have questions or need assistance, please contact your McCay Duff advisor.