Canada Emergency Wage Subsidy (CEWS)

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The government has announced the CEWS program will continue until June 2021, however, details on how the program will work beyond December 19, 2020 have yet to be released.

On October 14, 2020, changes to the subsidy were recommended for Period 8 (September 27 to October 24, 2020) and onward. Instead of using the current three-month revenue decline test for the top-up subsidy, both the base and top-up would be determined by the change in monthly revenue, year-over-year, for either the current or previous calendar month. This would allow businesses that have a sudden drop in revenue to maximize the subsidy in the specific month. You can currently apply for Period 8; however, we recommend waiting until the online spreadsheets have been updated with the proposed changes to avoid having to resubmit later.


The CEWS amounts received for an employee must be reported on the employees T4 on a per period basis. CRA has introduced several new boxes for T4 reporting covering the CEWS subsidy periods. The income report in these boxes will be the gross employment income received by the employee during each subsidy period.

  • Code 57: Employment income – March 15 to May 9
  • Code 58: Employment income – May 10 to July 4
  • Code 59: Employment income – July 5 to August 29
  • Code 60: Employment income – August 30 to September 26

Each period aligns with periods relating to COVID-19 benefit eligibility. The date the employee was paid during the period is reported in the box not the period of work the payment covered. For example, a payment made May 14, for the pay period of April 25 to May 8, should be reported under Code 58.

With the program extensions, there may be additional codes introduced before year-end. We recommend that you start collecting the necessary information to complete this reporting as soon as possible. If you need any assistance please contact us, and we and we will assist you with the process.


The 10% wage subsidy program is related to wages and salaried earned between March 18, 2020 and June 19, 2020. If you have not yet claimed this subsidy, you can claim it when filing your T4s.

To claim this subsidy, you need to file Form PD27, 10% Temporary Wage Subsidy Self-Identification Form for Employers. This document can be submitted through my business account to report the subsidy claimed to CRA. This form is used by CRA to reconcile your source deductions remitted on your final T4 Summary. Form PD27 is required for those who have claimed the TWS, intend to claim the TWS or have claimed the CEWS. If you elected at zero regarding the CEWS you must still complete the form.


On October 26, 2020, eligible business that currently operate through a personal bank account will be able to apply for CEBA. Previously a separate business bank account was required. This could provide significant relief for sole proprietors.

Also announced is an expanded CEBA from $40,000 to $60,000, which will be available to all eligible previous and new CEBA applicants. Half of the additional $20,000 financing would be forgivable if repaid by December 31, 2022, providing potential $20,000 in forgiveness on the total $60,000 loan. Our expectation is the $20,000 will require some combination of revenue drops and / or providing evidence similar to the non-deferred expenses approach for the $40,000.

The application deadline for this credit facility is December 31, 2020.


The new rent subsidy programs will be provided directly to tenants until June 2021 for qualifying organizations impacted by COVID-19. The subsidy will be based on a sliding scale of revenue decreases to a maximum of 65% of eligible expenses until December 19, 2020 and organizations would be able to make claims retroactively for the period that began September 27, 2020 and ends October 24, 2020. The periods would match up with the CEWS. Future parameters in 2021 are to be announced.

A top-up to the Canada Emergency Rent Subsidy of 25% for organization temporarily shut down by a mandatory public health order issued by a qualifying public health authority is also available in addition to the 65 percent subsidy.

It is important to note this has not been passed in Parliament yet, and we are waiting on more details around non-arm’s length arrangements (holding company renting to operating company) and for the definition of “mandatory shutdown”.


The province of Nova Scotia has implemented a program where a 25% rebate to help hotels, motels, and inns with their 2020-21 commercial property tax. The operator would need to have incurred a year-over-year revenue loss from room accommodation revenue of at least 30% for the period April 1, 2020 to October 31, 2020.

Eligible accommodations

  • must meet the definition of a roofed accommodation in the Tourist Accommodation Registration Act
  • have five or more rooms available for rent to the public
  • be assessed as a commercial property
  • not be in arrears of any real property taxes, up to and including 2020-2021 real property taxes

Applications for this rebate open on November 16, 2020.


For income tax purposes, CEWS is considered government assistance and is recognized as income when received. However, the legislation deems CEWS to be received at the end of the CEWS period to which it related. These period end dates are set out below:

  • Period 1: April 11, 2020
  • Period 2: May 9, 2020
  • Period 3: June 6, 2020
  • Period 4: July 4, 2020
  • Period 5: August 1, 2020
  • Period 6: August 29, 2020
  • Period 7: September 26, 2020
  • Period 8: October 24, 2020
  • Period 9: November 21, 2020
  • Period 10: December 19, 2020

As these dates will not match the typical business selection of a month-end date, this may create differences between accounting and taxable income for corporations and other entities with years ending between April and November 2020.

Claims can be filed as late as January 31, 2021 under the changes included in Bill C-20. Even if these claims are filed subsequent to year-end, the benefits are still deemed received, and taxable, at the end of each CEWS period.


The CEBA loan has a forgivable portion of 25% loaned amounts as of December 31, 2020. The forgivable portion is included in income in the period the loan is advanced. If the terms for the forgivable portion are not met, a deduction is available when it is repaid.

An election can be filed to exclude the payment from income and instead offset a related expense (Subsection 12(2.2)) or the cost of a related asset acquired (Subsection 13(7.4)). Where the non-deferrable expenses paid with CEBA funds are not incurred until the following year, such an election may permit the income to be deferred to match the expense.