Personal Finance

Government Relief for Businesses & Non-Profits: 75% Wage Subsidy

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  • Jul 16th, 2020 6:12 pm
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Oct 26, 2003
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Winnipeg
jeff1970 wrote: So does this cover those that work for local governments that might be facing layoffs?
Not the wage subsidy unless they keep you on, in which case yes, I expect government to also lose out on money from taxes.
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Mar 9, 2012
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divx wrote: Not the wage subsidy unless they keep you on, in which case yes, I expect government to also lose out on money from taxes.
Or are we considered "non-profit"? It wasn't super clear.

If the Feds are covering for a few months, then I'd expect that CUPE would make sure we stay on the payroll. They (local government) can afford to cover the other 25%.

I would imagine a wage freeze coming out of this 100%.
Why can't we all just get along?
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Aug 22, 2011
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Center of Universe
Samuro wrote: 75 percent payroll reduction remittance make more sense! I don't see how our government can afford 75% wage subsidy for all businesses!
Oh, they're going to print money and we'll feel the wrath of it for the rest of our lives and our kids lives, through heavy taxes after all said and done.
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Jan 21, 2018
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Vancouver
divx wrote: At this point the feds should just roll out cash for everyone, the administrative work going to be huge and everyone is affected by the virus anyway.
If the feds borrow a bunch of money, give a handout to everyone after paying for a massive administrative overhead, and then make the taxpayers pay it all back with interest - as they must - then they have done worse than if they did nothing at all.
Deal Expert
Feb 24, 2018
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I'm not sure this is the place to discuss the political merits of the government program.

I would recommend creating a thread in 'Controversial' regarding Government Spending surrounding Corona.

I created this thread to inform business principals and payroll decision-makers about payroll subsidy options.

Thank you.
I aim to be inclusive and considerate of others in my posts. If I fall short of that mark, feel free to let me know in good faith, and where appropriate, I'll edit my posts. Thank you.
Deal Addict
Oct 3, 2013
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West
I have a few questions for anyone who understands this better than I do [sorry, I edited one out... it was a super confusing and specific question]:


1) Are business owners able to "select" who they want to use this subsidy for? My employer has plans to use it to cover HIS salary, and the salary of those making close to minimum wage. He is planning to not to allow higher wage earners to benefit from this subsidy, and is laying them off instead. Seems a little unfair, but I suppose I can understand things from the "cash flow" perspective.

2) Are commissioned-based employees who make no hourly wage able benefit from this? Given the absence of hourly wages to calculate from, and the only realistic calculations would be from historical earnings (i.e. 2019 average weekly earnings).

3) How does the business 25% top-up work for those making above the covered amount? Example: an employee makes $2000/week, the subsidy will cover up to $847/week. Is the employer on the hook for $500 per week (i.e. 25% of the normal earnings)? Or just to top off the additional 25% of the subsidized amount (i.e. $282.33)?


I recognize not a lot is known about this at this time, but am interested to hear any insight.
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Aug 21, 2007
6054 posts
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Markham
DirtPoor wrote: That's a good question.
If the business corporation is paying a salary to the owner, could the owner get 75% of wage subsidized by the gov?
I’m working under the assumption that yes they would be eligible...ultimately the owner is an employee of the Corp...lots of scenarios where owners were on payroll and how have to shut entirely to be in compliance with Ontario essential business rules
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Feb 16, 2018
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i would really like to know how they determine a 30% loss in business. What period does this cover?
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Aug 21, 2007
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n0thing wrote: Not sure how they would calculate the 30% drop in revenue, though many should qualify except for maybe some essential services like grocery stores.

Justin mentioned the size of the business doesn't matter, even those with 1,000 employees.
My guess is an attestation re revenue drop...could be looking at between feb and March, or compare q1 of 2019 to 2020.

Can’t see how else they’d do it...maybe hst but not all are quarterly filers so not sure how that would work.

I’m more interested in how cash is going to actually flow.
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Aug 21, 2007
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Phonophoresis wrote: I have a few questions for anyone who understands this better than I do [sorry, I edited one out... it was a super confusing and specific question]:


1) Are business owners able to "select" who they want to use this subsidy for? My employer has plans to use it to cover HIS salary, and the salary of those making close to minimum wage. He is planning to not to allow higher wage earners to benefit from this subsidy, and is laying them off instead. Seems a little unfair, but I suppose I can understand things from the "cash flow" perspective.

2) Are commissioned-based employees who make no hourly wage able benefit from this? Given the absence of hourly wages to calculate from, and the only realistic calculations would be from historical earnings (i.e. 2019 average weekly earnings).

3) How does the business 25% top-up work for those making above the covered amount? Example: an employee makes $2000/week, the subsidy will cover up to $847/week. Is the employer on the hook for $500 per week (i.e. 25% of the normal earnings)? Or just to top off the additional 25% of the subsidized amount (i.e. $282.33)?


I recognize not a lot is known about this at this time, but am interested to hear any insight.
1. Yes I’d say they can lay off as they see fit and use the subsidy for those who remain. If a full layoff then shld be eligible for severance etc perhaps.

2. I doubt they will distinguish - but perhaps leave it to the employer.

3. Unclear. My sense is on the hook for a lower amount, as to cover off 75% they’d only have to payout the 847 + 282.
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Aug 22, 2011
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Center of Universe
HghSsociety wrote: i would really like to know how they determine a 30% loss in business. What period does this cover?
Previous fiscal quarter compared to this year's
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Jan 27, 2004
52935 posts
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ONTARIO
ZxExN wrote: What's the point of keeping employees or even business open when there are no customers? Businesses have tons of expenses not covered by anyone and people expect them to remain open? So many will go belly up from this.
So you can keep fighting and make whatever deals to keep business going and growing!
So employees have paychecks to buy things and keep other businesses going!
So employees can pay their rent or mortgage so the reAl estate market doesnt crash!

I get it...ra ra ra govt are evil cock sucking leaches.
But in the end of the day, they call the shots. We only hope they can call good ones.
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Jan 21, 2018
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Has a process for applying actually been posted anywhere? I see a lot of announcements of the program and the rapid changes to it, but I don't see links that actually go anywhere that looks like an application.
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Jan 21, 2018
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cardguy wrote: HST returns after the fact...if you cheat..you will be caught...you report revenue on the returns
That won't work. The majority of our business is export, on which we don't pay HST. A minority is in Canada, where we do pay GST and HST, but it's erratic, going up and down by quarter by a large amount.

We don't do any form of reporting of monthly or quarterly revenue to the government, only annual with our tax return.
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Oct 7, 2007
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Scote64 wrote: If the feds borrow a bunch of money, give a handout to everyone after paying for a massive administrative overhead, and then make the taxpayers pay it all back with interest - as they must - then they have done worse than if they did nothing at all.
I agree. This is really concerning. What is going to happen to all of us taxpayers who are already paying so much tax. We are going to be crushed. I would also like some clarification on what the entire plan is here and what the goal is. It started off being that we needed people to stay at home so they would self-isolate and not spread the disease. This makes sense. But now it is expanding into giving large amounts of money to businesses and maybe others who don't qualify for EI with very little control over ensuring that certain conditions are met or controls in place (from what I can see so far) to ensure everyone's job is saved. If the money is going to be spent, I would have preferred to have seen a holistic plan rolled out describing each of the benefits with their goals and purpose laid out (and conditions attached like making staying at home a condition of receiving "stay at home" pay) and also a plan for how we are going to dig ourselves out of both the virus issue and the economic mess we are now in. It really feels like we are just "sheltering in place" indefinitely hoping for the best with only talk of "social distancing" and "wash your hands" but no talk of how we are going to actually defeat this thing and/or get on with our lives any time soon. I don't know how much the economy can take of this before we see individuals (not employed by the government) and business owners start to suffer as the uncertainty about the future mounts to epic proportions.
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Jul 14, 2013
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More details about this coming today?
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Nov 17, 2004
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choclover wrote: I agree. This is really concerning. What is going to happen to all of us taxpayers who are already paying so much tax. We are going to be crushed. I would also like some clarification on what the entire plan is here and what the goal is. It started off being that we needed people to stay at home so they would self-isolate and not spread the disease. This makes sense. But now it is expanding into giving large amounts of money to businesses and maybe others who don't qualify for EI with very little control over ensuring that certain conditions are met or controls in place (from what I can see so far) to ensure everyone's job is saved. If the money is going to be spent, I would have preferred to have seen a holistic plan rolled out describing each of the benefits with their goals and purpose laid out (and conditions attached like making staying at home a condition of receiving "stay at home" pay) and also a plan for how we are going to dig ourselves out of both the virus issue and the economic mess we are now in. It really feels like we are just "sheltering in place" indefinitely hoping for the best with only talk of "social distancing" and "wash your hands" but no talk of how we are going to actually defeat this thing and/or get on with our lives any time soon. I don't know how much the economy can take of this before we see individuals (not employed by the government) and business owners start to suffer as the uncertainty about the future mounts to epic proportions.
I'm not too sure what you expect the government to do in regards to telling people how they are going to "defeat" the virus? If they knew how to do it, and if the entire world knew how to do it in a 100% proven way, wouldn't they have already done it? Have you been following the daily/weekly medical reports, announcements and recommendations? At the moment, social distancing and washing our hands are the best proven ways to protect ourselves short of a vaccine. Would you be happier if they mandated what they've done in Italy and Spain by using the military to ensure that people stay indoors?

And I'm not sure what you're trying to say at the end of your comment either: you want the government to do something to help save (non government) jobs and small business owners, which is exactly what these two relief programs we are discussing does. The interest free loan that will forgive $10K of the debt if paid back on time is basically $10K of free money that can hopefully help businesses pay for some of their set overhead expenses that accrue even if they laid off everybody. The other $30K is to help them get through the rest of their expense as well as give them some capital to do payroll (which often occurs before business's accounts receivable is cleared) so that they can even take advantage of the payroll subsidy. Both of these methods are great ways to save businesses as well as ensure that regular (non government) people can keep their jobs.

With that said, I think as OP said, this is an entirely different conversation that should be taking place in a different thread. We aren't here to debate the merit of the program, but we're here to discuss how we business owners can make use of the programs to try and both "save" our businesses as well as hire back as much of our staff as possible to assist their current financial situations as well as help inject much needed money into our economy at the same time (both right now and after this is all over).


adeel wrote: 1. Yes I’d say they can lay off as they see fit and use the subsidy for those who remain. If a full layoff then shld be eligible for severance etc perhaps.

2. I doubt they will distinguish - but perhaps leave it to the employer.

3. Unclear. My sense is on the hook for a lower amount, as to cover off 75% they’d only have to payout the 847 + 282.

1. I agree. I'd say that there's a good spread between business owners that just take dividends from their companies and those of us who put ourselves on payroll (pros and cons to both ways- it seems that finally the pro that comes out of paying all the CPP is that we can now take advantage of this wage subsidy program)

2. I agree that they will most likely leave it to the employer to calculate averages.

3. That is a very good question as well, but until they clarify everything, this is what I interpreted from Trudeau's speech: When they say 75%, they refer specifically to a max income of $58K a year which then equals to a max subsidy of $847/week. From his exact wording, he said that if you are able to do so, please top up your employees. With that wording, I would interpret it as: you can bring your staff back at 75% of their original pay (if they make less than $58K/yr) and if they make more than that, you can hire them back at partial pay and just pay them the $847/week.

I hope that my interpretation about #3 above is correct, as it would be the only way that I could bring my staff back. We are 100% closed and have no revenue until the provincial stare of emergency is lifted and we would not be able to top up our staff for 25% of their salaries without any money coming in and the $40K interest free loan would only last a couple months if that. If the above is correct, then at least my staff would be able to get more money than they are getting through EI right now and it would also take some stress off of the EI and CERB programs.
Sr. Member
Mar 1, 2020
844 posts
237 upvotes
GTA West
I am as confused as the above poster... As an employer, if revenues are so low now that it's actually unprofitable for us to pay the 25% NON-SUBSIDY amount, if we have 10 staff, that's still over 2k/WK... Given how long this may take, I'd have no choice but to just close and go full retirement mode vs bleeding cash...
As well, thinking longer term I dunno how this is sustainable if taxes and the cost of doing business goes up, but that's a different story for another day... I'd HV to think seriously longer term eg next 3-5 yrs and not this next few weeks/months if it's worth opening up
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Aug 21, 2007
6054 posts
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Markham
CensoredByRFD wrote: I'm not too sure what you expect the government to do in regards to telling people how they are going to "defeat" the virus? If they knew how to do it, and if the entire world knew how to do it in a 100% proven way, wouldn't they have already done it? Have you been following the daily/weekly medical reports, announcements and recommendations? At the moment, social distancing and washing our hands are the best proven ways to protect ourselves short of a vaccine. Would you be happier if they mandated what they've done in Italy and Spain by using the military to ensure that people stay indoors?

And I'm not sure what you're trying to say at the end of your comment either: you want the government to do something to help save (non government) jobs and small business owners, which is exactly what these two relief programs we are discussing does. The interest free loan that will forgive $10K of the debt if paid back on time is basically $10K of free money that can hopefully help businesses pay for some of their set overhead expenses that accrue even if they laid off everybody. The other $30K is to help them get through the rest of their expense as well as give them some capital to do payroll (which often occurs before business's accounts receivable is cleared) so that they can even take advantage of the payroll subsidy. Both of these methods are great ways to save businesses as well as ensure that regular (non government) people can keep their jobs.

With that said, I think as OP said, this is an entirely different conversation that should be taking place in a different thread. We aren't here to debate the merit of the program, but we're here to discuss how we business owners can make use of the programs to try and both "save" our businesses as well as hire back as much of our staff as possible to assist their current financial situations as well as help inject much needed money into our economy at the same time (both right now and after this is all over).






1. I agree. I'd say that there's a good spread between business owners that just take dividends from their companies and those of us who put ourselves on payroll (pros and cons to both ways- it seems that finally the pro that comes out of paying all the CPP is that we can now take advantage of this wage subsidy program)

2. I agree that they will most likely leave it to the employer to calculate averages.

3. That is a very good question as well, but until they clarify everything, this is what I interpreted from Trudeau's speech: When they say 75%, they refer specifically to a max income of $58K a year which then equals to a max subsidy of $847/week. From his exact wording, he said that if you are able to do so, please top up your employees. With that wording, I would interpret it as: you can bring your staff back at 75% of their original pay (if they make less than $58K/yr) and if they make more than that, you can hire them back at partial pay and just pay them the $847/week.

I hope that my interpretation about #3 above is correct, as it would be the only way that I could bring my staff back. We are 100% closed and have no revenue until the provincial stare of emergency is lifted and we would not be able to top up our staff for 25% of their salaries without any money coming in and the $40K interest free loan would only last a couple months if that. If the above is correct, then at least my staff would be able to get more money than they are getting through EI right now and it would also take some stress off of the EI and CERB programs.
You may be right #3 - I've also taken those comments about if you can top up, please do. May also factor into comments re gaming the system. Unclear how.

We were supposed to get more details today, but Morneau is now self-isolating, so not sure if we will?

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