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THE NEW CEBA LOAN REPAYMENT: YOUR ESSENTIAL GUIDE TO FINANCIAL RECOVERY

CEBA LOAN REPAYMENT 1
CEBA loan repayment

CEBA loan repayment: Introduction

Welcome to Brandon’s Blog, where we make every effort to furnish companies and all businesses with the necessary methods to deal with challenging economic uncertainty. Understanding your present financial health and wellness is crucial in overcoming problems and safeguarding long-lasting durability. As we are receiving many calls from entrepreneurs who are concerned about their company’s ability to make their CEBA loan repayment before the end of this year to take advantage of the partial loan forgiveness available before January 1, 2024, I thought this topic would be timely.

The COVID-19 pandemic has produced unprecedented financial challenges for companies around the world. Lockdowns lowered consumer spending, and the previously interfered with supply chains have left many battling to stay afloat. Businesses are confronted with the job of balancing the desire to protect the jobs of their employees while trying to turn a profit, or at least, stay afloat.

The financial influence of the pandemic has actually been felt most acutely by small and medium-sized companies, a number of which have been compelled to close permanently. Governments all over the world have carried out different relief steps to support struggling businesses, including the CEBA and other pandemic loans, yet there is no doubt that the roadway to recuperation will be a long and tough one.

As reported in a Financial Post article this past summer, “‘I feel abandoned’ — businesses warn of bankruptcy as deadline to pay back COVID loans looms, many businesses are still struggling with below-normal revenues even after the lifting of pandemic-related lockdowns. These businesses were able to receive federal government assistance through programs such as the Canada Emergency Business Account (CEBA) to stay afloat.

However, with the rise in interest rates and Canadian inflation, many businesses are experiencing further declines in earnings and are concerned about their ability to repay their CEBA loans before the original interest-free period, now extended, ends on January 18, 2024. On September 14, 2023, the federal government slightly extended the deadline, because of the clarion call of business associations across Canada for an extension to the repayment timeline. (See the section below “CEBA loan repayment: Extension hot off the press!“).

The article refers to a Canadian Federation of Independent Business (CFIB) survey revealing that 40% of the nearly 6,000 small businesses that participated in the survey are at risk of missing the current repayment deadline. Businesses with zero to four employees are most likely to struggle with making the payment. Even among the 47% who reported being able to pay, half of them anticipate difficulty in doing so. These findings come from Canada’s largest association of small businesses.

In this Brandon’s Blog, we aim to provide practical advice and valuable insights for businesses navigating the CEBA deadline.

CEBA loan repayment: Explanation of the CEBA and its importance during the pandemic

In response to the challenges presented by the COVID-19 pandemic, the Canadian government implemented a support program for small and medium-sized eligible businesses called CEBA. This initiative offered interest-free loans of up to $60,000 to eligible organizations, with a portion of the loan being forgiven if repaid by the new January 18, 2024 deadline without the borrower defaulting.

CEBA played a vital role in providing much-needed financial aid to struggling SMEs during these challenging times. By helping companies cover their expenses and maintain operations, CEBA assisted in preserving jobs and supporting economic stability. Overall, this program was effective in mitigating the impact of the pandemic on Canadian businesses.

CEBA loan repayment
CEBA loan repayment

The CEBA loan repayment deadline

The Financial Post article stated that as the deadline for repayment for each Canadian operating business with an outstanding CEBA loan draws near, many business owners are considering alternative loans to repay the CEBA loan they received. This decision could have a negative impact on the future of their businesses that are already under financial pressure.

Business owners quoted in the article stated that they believe they will have to utilize a line of credit to make the CEBA loan repayment by the deadline in order to take advantage of the forgivable portion. They are already struggling with overdue rent and property taxes, which has added to his financial burden.

These business owners say they have noticed an increase in unsolicited loan offers from dubious sources, who are looking to exploit the situation. A loan offer from an online lender had an interest rate of around 20%! Naive business owners that are desperate may be vulnerable to these predatory lending practices.

Missing the deadline for the CEBA loan repayment to take advantage of the loan forgiveness portion can lead to potential consequences for struggling businesses. We have been receiving phone calls from small business owners thinking that if they miss this end-of-year deadline it means their business is over and they will need to consider business bankruptcy.

These concerns are legitimate. The pandemic was not the small business’s fault. However, it seems that many business owners are unnecessarily hitting the panic button over the CEBA loan interest-free repayment date.

CEBA loan repayment is significant

Loan repayment is of utmost importance for all businesses facing financial uncertainty, including when it comes to the CEBA loan. Failing to make the CEBA loan repayment on time results in penalties and additional fees.

What will happen? There will be a loss of the substantial benefit from the loan forgiveness portion. As well, the loan’s interest-free period will end. CEBA loans will become two-year term loans and will begin charging interest at 5% per annum. Given the interest rate increases implemented by the Bank of Canada, a loan with a 5-per-cent annual rate right now looks cheap!

It is natural for every business owner to want to show their financial responsibility and take advantage of the substantial discount offered. But if the business is recovering, and will be able to start making CEBA loan repayment monthly payments beginning in 2024, the end result is not one that by itself, would cause businesses to fail. The CEBA loan is also an open loan, so if the business starts thriving after 2023, it can pay off the full amount then owing, albeit, without the juicy forgiveness portion.

So although it is preferable to make the CEBA loan repayment in full by the end of this year to take full advantage of the discount, the business will not necessarily fail just because the business cannot make a full CEBA loan repayment this year. However, if your business cannot recover from the COVID-19 pandemic, then the CEBA loan is not the only debt your business will not be able to repay.

CEBA loan repayment
CEBA loan repayment

CEBA loan repayment: Extension hot off the press!

On September 14, 2023, Prime Minister Trudeau, in a resounding declaration, addressed the pressing matter of CEBA loan repayment deadlines. The new policy creates an extended horizon. Companies now have until January 18, 2024, to make the CEBA loan repayment and take advantage of the partial loan forgiveness. For those not able to do so, the federal government is now offering an extra year to the timeline for repaying these term loans.

The CEBA initiative, which ran from April 9, 2020, to June 30, 2021, had bestowed nearly 900,000 SMEs and not-for-profits with a staggering sum of $49 billion. These financial lifelines were strategically deployed to defray the exigent operational overheads that besieged these businesses throughout the harrowing pandemic.

The horizon of the CEBA loan repayment deadline now stretches out from December 31, 2023, reaching January 18, 2024, all while preserving the prospect of partial loan forgiveness. The reason given is to make accommodations for the bustling year-end routines that a myriad of Canadian enterprises grapple with.

For those who find themselves unable to conform to the revised CEBA loan repayment deadline, as long as they make the requisite arrangements by January 18, 2024, their term loans will now extend the term loan repayment date yet another year, beyond the horizon of December 31, 2025, to December 31, 2026. The annual interest rate, for this now up-to-three-year term loan, remains resolute at a steadfast 5% per annum.

Here are some helpful tips that will help you determine what is best for you and your business going forward.

CEBA loan repayment: Term of the loan and principal payment schedule

The CEBA initiative extended financial support to qualified enterprises, granting them a vital economic lifeline. Let us delve into the key features of the CEBA loan reimbursement conditions:

Interest component

Not a single penny in interest shall accrue up to the fateful date of January 18, 2024. This means that for the entirety of the outstanding loan until that date, an annual interest rate of a resounding zero percent prevails. Subsequently, the interest rate shall metamorphose into 5% per annum, and whichever of the financial institutions processed your CEBA loan, will advise you of both the interest and principal reimbursement schedule.

The redemption and maturity of CEBA loans

There exists no obligation to remit any of the principal outstanding balance prior to January 19, 2024. Should the loan’s existence persist beyond this threshold, you will be obligated to start making monthly blended payments of interest and principal repayment until such time as the entire principal amount is repaid (without getting the benefit of any loan forgiveness), no later than the new date of December 31, 2026. Therefore, the CEBA loan goes from a 2-year term loan to a 3-year term loan.

Debt forgiveness provisions

In the eventuality that the outstanding balance of principal is paid off in full on or prior to January 18, 2024, a unique privilege unveils itself – the right to offset a portion of the debt forgiveness from the total owing. This accommodation is provided by the Federal government and processed through financial institutions, as long as the business has not, at a prior juncture, defaulted upon its financial obligations as per the loan agreement.

CEBA loan repayment
CEBA loan repayment

CEBA loan repayment: Assess your business’s financial situation

Assessing the financial health of a company is extremely important in understanding its current situation and potential for first survival, then profitability and growth. Examining key financial metrics such as cash flow, revenue trends, and debt levels can provide valuable insights for stakeholders to make informed decisions about the company’s future. By identifying areas of strength and weakness, as well as potential risks and opportunities, stakeholders can develop effective financial strategies that align with the company’s goals and objectives. Ultimately, conducting a thorough assessment of a company’s financial health is critical for ensuring its long-term viability and success.

To attain business financial success, it is necessary to begin with a thorough examination of the financial scenario of the business. Begin by collecting all relevant financial records, such as bank statements and invoices, as well as calculating your regular monthly revenue versus your expenses. This will aid you in determining your net cash flow, an important consideration in making informed financial decisions.

Once you’ve identified your expenditures, it’s time to find methods to reduce costs. This could include cutting optional spending or renegotiating agreements with vendors. Furthermore, it is essential to prioritize payments based on due days and rates of interest to manage outstanding debts.

Preserving a budget plan is important to keeping your finances on track. It aids you in staying clear of overspending and also makes sure that you’re making progress towards your financial goals. Frequently assessing your cash flow, expenses, and outstanding debts is crucial for accomplishing long-lasting financial stability.

CEBA loan repayment: Explore other financial options

For companies to flourish in the current financial climate, it is vital to increase their funding past relying exclusively on the CEBA. Although CEBA has been helpful for companies affected by the COVID-19 pandemic, it is not a practical long-term remedy. To ensure sustainability and also safety and security, businesses need to diversify their financial resources.

This could be accomplished by exploring alternative borrowing options like conventional financing or using funds from government programs. In addition, it may deserve to think about cost-cutting procedures to free up funds and create alternate revenue streams. By branching out, companies can much better withstand unanticipated financial challenges, build durability, and secure long-term success.

CEBA loan repayment: Business cost-cutting measures

Carrying out cost-cutting measures is an essential technique for companies to boost financial stability. Cost-cutting actions are designed to decrease expenditures, enhance effectiveness, and inevitably improve the bottom line. By carrying out these actions, businesses can optimize their operations and also allocate resources more effectively. This results in improved success as well as cash flow, which can be reinvested right into the business for future growth. Furthermore, cost-cutting procedures can assist services to stay competitive in their respective markets. On the whole, executing cost-cutting steps is a required step for businesses to keep economic stability and accomplish profitability, stability and growth.

Managing your company’s financial resources properly requires you to recognize and decrease non-essential expenses. This includes critically evaluating your cost control habits to cut down on unneeded expenditures without jeopardizing your important needs.

One useful idea is to develop a spending plan that takes into consideration all your expenditures as well as track your spending. This will allow you to determine areas where you are spending too much and make necessary changes.

An additional strategy is to prioritize your expenses as well as focus on what are your essential requirements while reducing non-essential expenses. Things such as eating in restaurants or acquiring unnecessary items are obvious non-essential expenses. Negotiating with your suppliers to decrease prices or switching to more budget-friendly alternatives can also be practical.

By adopting these easy yet sensible strategies, you can conserve money and enhance your business’s financial security in the long term.

As companies navigate economic difficulties and also change top priorities, there might come a time when staff reductions come to be required. It is necessary to deal with these situations with realism, recognizing the possible effect on employees’ financial safety and spirits. Interaction is crucial, as well as employers need to be forthright about why reductions are required, along with transparency concerning the timing and the need for downsizing.

Assistance and resources, such as severance plans as well as job search assistance, can help reduce the burden for impacted staff members. When choosing who will be affected by decreases, it is very important to focus on fairness and equity. Before implementing a downsizing plan, it is advisable to check out alternatives such as reduced hours or furloughs before considering terminations. Ultimately, handling HR reductions with sensitivity and regard to the human element can aid in keeping trust between employers and employees, even in tough times.

CEBA loan repayment
CEBA loan repayment

CEBA loan repayment: Seek professional advice

Seeking professional advice from financial experts, lawyers and industry specialists is a smart financial investment for any company’s future. These professionals possess specialized expertise and experience that can help business owners make educated choices about improving business practices and operations leading to improved performance and profits. They can offer valuable advice on budgeting, managing financial obligations, and legal and operational efficiency matters.

Furthermore, financial advisors can offer customized methods that cater to each business’s special financial goals and circumstances. By working with advisors, entrepreneurs can feel great that their strategies are well-informed and well-executed. Inevitably, the true value of talking to experts hinges on the comfort of having a solid structure and a clear roadmap for accomplishing business success.

In the business world today, it is essential to have a crystal-clear understanding of your firm’s standing and the necessary activities to achieve development and success. The advantages of professional guidance are plentiful as it gives customized methods to help your business. Collaborating with a specialist or various specialists can assist in identifying your core competencies as well as weaknesses, offering tailored suggestions to improve your business operations. This includes expert suggestions on marketing, finance, personnel, operations and a lot more. By obtaining a fresh perspective on your company, you can significantly enhance efficiency, performance, and productivity in the long run. Consequently, seeking professional assistance is a logical choice for businesses wanting to reach their goals and beyond.

CEBA loan repayment: Conclusion

In conclusion, CEBA loan repayment is an issue causing entrepreneurs a great amount of stress these days. Both individuals and business owners must take proactive measures to address financial difficulties and promptly seek assistance when necessary. It is crucial to recognize that financial stress is a prevalent concern and seeking help is a demonstration of fortitude, rather than vulnerability. Should you encounter challenges in managing your finances and find yourself burdened by stress, do not delay in pursuing aid.

Revenue and cash flow shortages are critical issues facing people, entrepreneurs and their companies and businesses with debt problems that are in financial distress. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind.

The Ira Smith Team understands these financial health concerns. More significantly, we know the requirements of the business owner or the individual who has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious.

It is not your fault you can’t fix this problem on your own and it does not mean that you are a bad person. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Trustee & Receiver Inc. Team uses innovative and cutting-edge methodologies, to adeptly navigate you through the intricacies of your financial challenges, ensuring a resolution to your debt-related predicaments without resorting to the rigours of the bankruptcy process. We can get you debt relief now!

We have helped many entrepreneurs and their insolvent companies who thought that consulting with a Trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring.

We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you.

The Ira Smith Trustee & Receiver Inc. team understands that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel.

Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.

CEBA loan repayment
CEBA loan repayment

 

Categories
Brandon Blog Post

CEBA LOAN REPAYMENT CAUSING YOU A GIGANTIC PROBLEM? HERE IS OUR COMPREHENSIVE SOLUTION GUIDE

CEBA
CEBA

CEBA Introduction

As businesses continue to grapple with the economic fallout of the COVID-19 pandemic, the Canadian federal government’s Canada Emergency Business Account (CEBA) loan program has proven to be a lifeline for those who qualified under the eligibility criteria. The CEBA program was available to businesses regardless of whether they were sole proprietorships, partnerships or corporations.

However, as the deadline for loan repayment approaches, many Canadian businesses are struggling to meet their obligations. Entrepreneurs fear that they may not be able to take advantage of the discount available for repaying the entire loan by the deadline of December 31, 2023.

In light of this, it’s crucial for business owners to enhance their cash flow management, refine their budgeting practices and diversify their revenue streams in order to develop an effective repayment plan. In this Brandon’s Blog, I’ll explore strategies for overcoming CEBA loan repayment challenges, highlighting expert guidance on navigating your loan obligations and achieving financial stability for your business. Hopefully, by using a professional approach, this Brandon’s Blog will inspire business owners and provide them with the knowledge and tools required to tackle these challenges head-on.

Importance of understanding the challenges associated with CEBA loan repayment by December 31, 2023

Comprehending the obstacles related to paying off the CEBA loan balance by the defined target date is critical for enterprises. It provides a considerable hurdle that businesses must repay the loan by the deadline to capitalize on the significant discount given for prompt reimbursement. While the financing stays interest-free up until then, interest charges begin thereafter. This suggests that Canadian businesses might face a financial burden, specifically if they are still recuperating from the prevalent impacts of the COVID-19 pandemic.

Furthermore, companies that fall short to satisfy the payment deadline might come across negative effects, like not being able to access further loans or other financial assistance.

CEBA
CEBA

Common challenges faced in CEBA loan repayment

Cash Flow Constraints and Their Impact on Loan Repayment

The effective handling of loan repayment can be substantially affected by the restrictions enforced by cash flow constraints. Restraints in the capital of the business have the possibility to generate missed payments, and penalties and apply stress on the economic security of your company. Comprehending the ramifications of these cash flow constraints is of utmost significance to formulate methods that successfully take on these difficulties.

1. Reduced capability for repayment

When capital restraints are experienced by your company, the ability to make timely and full loan payments are jeopardized. Minimal funds being readily available for loan repayment causes smaller-sized or delayed payments, leading to increased financial pressure on the business. Positive steps need to be taken to overcome these restraints.

2. Intense financial stress

Cash flow restrictions can generate financial stress on the entrepreneur as they navigate expenses and prioritize payments. The worry of managing day-to-day operations while confronting the reality of missing loan payment commitments can be overwhelming. This stress can adversely impact emphasis, decision-making, as well as overall organizational efficiency. It is of utmost value to formulate approaches that relieve economic stress and supply a clear roadmap for handling these cash-flow challenges.

3. Restricted growth opportunities

Insufficient capital development can hamper the growth and growth plans of your company. Many businesses have not yet seen an economic recovery of any substance. When a significant portion of your available cash needs to be allocated to loan repayment, limited funds are available for financial investment in the other areas of your business in order for it to grow and prosper. This constraint can stop your capacity to profit from business opportunities and compete successfully.

4. Tested relationships with suppliers and Financial institutions

Restricted cash flow can stress partnerships with suppliers and financial institutions. Late or missed payments can stain the credibility and reliability of your business, making it tough to negotiate good terms or additional credit when needed. Healthy connections with suppliers and also financial institutions are essential to maintain company operations and foster future development.

Lack of Financial Planning and Its Consequences

Falling short in financial planning can have major effects when it involves repaying loans. Businesses that don’t effectively prepare themselves or take proactive steps will find themselves struggling to meet financial commitments, which will cause unfavourable results. The effect of inadequate monetary planning leads to the negative consequences described above. In this area, I share sensible suggestions to assist businesses in effectively conquering these obstacles.

To alleviate the consequences of an absence of financial preparation as well as ensure successful loan repayment, take into consideration implementing and adhering to the following:

1. Produce a detailed financial strategy

Establish a comprehensive financial plan strategy that includes a proper budget, cash flow plan, and also a specific plan for loan repayment. Set reasonable economic goals and allocate funds accordingly.

2. Monitor and review funds regularly

Consistently examine your financial performance and also compare it with your strategy. This will certainly help you recognize any kind of deviations or possible issues in a prompt and allow you to make the necessary business adjustments.

3. Seek professional help

Consider dealing with a financial consultant or accounting professional who can supply guidance on financial planning, cash-flow monitoring, and loan repayment strategies. Their competence can aid you navigate the complexities of your corporate financial circumstances more effectively.

4. Automate loan payments

Establish automated payments on your loans to make sure prompt and also constant payments. This decreases the threat of missed payments and associated penalties.

5. Prioritize loan payment

Make loan repayment a top priority in your monetary strategy. Allot enough funds from your profits to cover the repayment responsibilities, even if it means making adjustments in other areas of your business.

By proactively addressing the lack of financial planning and implementing these methods, companies can avoid the consequences of missed payments, additional interest charges and all the other negative consequences.

Inefficient budgeting practices and their challenges

Suboptimal fiscal management techniques may present formidable impediments to successful loan repayment. In the absence of a meticulously crafted and adroitly executed budget plan, commercial entities may encounter hindrances such as:

  • Erroneous financial forecasting
  • Obscurity in expenditure tracking
  • Negligence toward prioritizing debt repayment
  • Inadequate monetary reserves or liquidity
  • Inefficacious expense management

To surmount the obstacles that arise from suboptimal budgeting practices, enterprises may wish to contemplate adopting the ensuing strategies:

  • Formulate a comprehensive budget
  • Enhance tracking of expenditures
  • Make repayment of loans a priority
  • Establish an emergency reserve
  • Engage the services of a professional

Through the implementation of these techniques and the adoption of proficient budgeting practices, businesses can triumph over the impediments presented by ineffectual budgeting and guarantee a more viable approach to loan repayment.

Limited profitability and Its implications for CEBA loan repayment

The ramifications of inadequate profitability can be profound when it comes to CEBA and other loan repayments. A business that is unable to generate ample profits may encounter difficulties in meeting its loan commitments. The consequences of limited profitability are:

  • Inadequate cash flow
  • Increased debt load
  • The peril of loan default
  • Curtailed business expansion
  • Tense relationships with suppliers and lenders

Despite the challenges posed by limited profitability, there are several aggressive steps companies can take to get rid of these barriers. Take into consideration the following methods:

  1. Conduct an extensive financial evaluation to pinpoint areas of improvement, consisting of the business’s cost framework, pricing methods, and revenue streams. Try to find chances to minimize expenses, boost performance, and expand revenue.
  2. Develop methods to increase earnings, such as reviewing pricing models, implementing cost controls, boosting operational effectiveness, and also exploring brand-new markets or product/service offerings.
  3. Take part in open interaction with lenders to discover possible financial debt restructuring or arrangement of settlement terms. Lenders may agree to change interest rates, extend payment periods, or give short-lived relief alternatives based on the business’s financial scenario.

To improve their ability to meet all financial commitments and make steady progress toward profitability, businesses can benefit from implementing these strategies.

Uncertain economic environment and Its effect on CEBA loan obligations

The ever-changing economic landscape can bring about a profound influence on the commitments tied to the CEBA loan. Companies grappling with market turbulence and unpredictability may face difficulties in fulfilling their loan repayment obligations. Within this segment, I will delve into the repercussions of an uncertain economic environment on CEBA loan responsibilities and propose effective approaches to overcome such circumstances.

1. Unpredictable income streams and loan repayment

As a result of an uncertain economic environment, companies may find themselves in a situation where they experience inconsistent earnings. Market volatility, changing customer preferences, as well as economic downturns, can all contribute to this unpredictability. Consequently, businesses might have a hard time allocating adequate funds for CEBA loan repayment.

2. Financial stress and decreased earnings

In an unpredictable financial environment, companies might experience lowered profitability due to elements such as lowered consumer purchasing, supply chain interruptions, as well as boosted input costs. This financial pressure can make it tough to find the resources for not only CEBA loan repayment but for the sustainability of the entire company.

3. Restricted accessibility to credit and financing

Throughout uncertain financial times, lenders will tighten their credit standards and decrease the availability of funding options. This minimal access to credit can adversely influence companies requiring extra funding to sustain their operations.

4. Changing federal government support programs

The government’s response to an uncertain economic environment can involve modifications or adjustments to support programs, including those related to CEBA loans. Many business groups and Chambers of Commerce have already been lobbying the federal government to extend the repayment deadline by one year to December 31, 2024, as many companies are still struggling. Time will tell if the federal government will extend the interest-free loan term or not.

5. Strategic financial planning and adaptability

To best navigate an uncertain economy, businesses can utilize strategic financial initiatives. Take into consideration the following approaches:

Monitor and budget: Routinely check economic indications, market fads, and also customer behaviour to anticipate possible influence on your business. Adjust cash flow forecasts and financial strategies as necessary.

Risk administration: Examine and minimize threats that can affect your revenue streams, productivity, and profitability. Expand your customer base, explore brand-new markets, or think about alternative revenue streams to decrease reliance on particular industries or markets.

Communication with lenders: Keep open lines of communication with your lending institution to go over any type of obstacles or changes in your financial scenario. Proactively will address any possible problems and help your lenders work with you to find choices for funding alterations.

Cash flow monitoring: Implement robust cash flow techniques, consisting of monitoring expenditures, enhancing working capital, as well as negotiating favourable terms with suppliers. Effective cash flow management can liberate cash resources for supporting operations during unpredictable times.

Business continuity planning: Develop a comprehensive organization continuity strategy that takes into consideration numerous economic scenarios. Recognize strategies to mitigate the impact of financial volatility on your procedures and allocate resources for loan repayment as a priority.

By adopting these approaches and staying watchful in checking the economic landscape, businesses can better navigate the obstacles of an unpredictable economy. The assistance of financial professionals is key in navigating rough economic waters.

CEBA
CEBA

CEBA loan repayment problem does have a silver lining

The requirements for CEBA loan repayment carry the following provisions. There is no interest charged until the end of December 2023. Thereafter, the annual interest rate will be 5%. The frequency of interest payments will be determined by the applicant’s financial institution but most likely, it will be monthly.

There is a silver lining if your business is unable to repay the discounted loan amount in full by the end of this year. Given the Bank of Canada interest rate hikes, the current overnight rate is 4.75%. The prime rate charged by the chartered banks to their best customers is around 6.95%.

So under current economic conditions in Canada, the proposed interest rate to be charged on outstanding CEBA loans beginning January 1, 2024, of 5%, is well under current interest rates charged on unsecured business loans.

CEBA Conclusion

In summary, defaulting on your CEBA loan repayment can result in negative effects on your business Nonetheless, there are still 6 months to go before completion of the year. With the appropriate strategies in position, you can overcome the challenges of settling your CEBA loan.

Developing a comprehensive repayment strategy, improving your cash flow administration, improving your budgeting methods, and also diversifying your revenue streams are all essential steps to accomplishing financial improvement and security. Seeking skilled professional support can also assist you navigate the intricacies of your CEBA loan obligations and set up your business for lasting success. With these methods in hand, you can take control of your finances and remain ahead of your CEBA loan repayment.

I hope you enjoyed this CEBA Brandon’s Blog Managing your personal or business financial affairs in today’s ever-challenging and changing business landscape is no small feat, but with the right plan in place, it’s possible to stay or get back on track.

Revenue and cash flow shortages are critical issues facing people, entrepreneurs and their companies and businesses that are in financial distress. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind.

The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious.

It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team uses innovative and cutting-edge methodologies, to adeptly navigate you through the intricacies of your financial challenges, ensuring a resolution to your debt-related predicaments without resorting to the rigours of the bankruptcy process. We can get you debt relief now!

We have helped many entrepreneurs and their insolvent companies who thought that consulting with a Trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring.

We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you.

The Ira Smith Trustee & Receiver Inc. team understands that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel.

Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.

CEBA
CEBA

 

Categories
Brandon Blog Post

CEBA LOAN UPDATE: 3 INTRIGUING CREATIVE WAYS FOR ENTREPRENEURS TO CONQUER CEBA LOAN DEFAULT

ceba loan update

We hope that you and your family are safe, healthy and secure during this COVID-19 pandemic. Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

CEBA loan update introduction

Canada Emergency Business Account (CEBA) loan application deadline was on June 30, 2021. As of right now, COVID-19 support for businesses and individuals soon will be ended by the federal government. The assistance from government programs has been both necessary and very helpful. CEBA was merely one product from an array of government support for Canadians and Canadian businesses.

Many entrepreneurial businesses have lost confidence in their financial prospects due to uncertainty over the fate of ongoing federal pandemic support, according to the Canadian Federation of Independent Business (CFIB). It is pushing the Liberals for more life support to avoid a flood of insolvencies.

This Brandon Blog provides a CEBA loan update and answers a question that many entrepreneurs have asked us: What counts as a CEBA loan default? The blog also tells you about three intriguing creative ways for entrepreneurs to conquer CEBA loan default.

CEBA loan update: Original CEBA eligibility requirements

The CEBA online application process began on April 9, 2020. It was part of the general program to supply Canadian companies with access to credit and support for business operations under the COVID-19 support introduced by PM Trudeau. Under the original program, federally guaranteed financing was provided to each qualifying company for $40,000 by financial institutions.

Canadian chartered banks processed and financed the loans based on the applications from businesses. The Canada Emergency Business Account is not a business account, despite its name. Instead, it serves as a non-revolving loan. It is a government-guaranteed loan of $40,000. The CEBA are interest-free loans that do not need to be repaid until December 31, 2022. Interest will accrue after that date.

The Canadian government created the CEBA to assist small and medium companies and non-profit organizations with their most pressing cash needs during the COVID-19 crisis. The entire process was conducted online. A pre-screening tool was implemented as part of the process. Applicants completed the questionnaire and provided the necessary information. After that, the online application process system:

  • issued a CEBA pre-screen tool reference number;
  • advised that your bank had submitted the application;
  • explained that your bank has no involvement in the application process; and
  • that you will hear back within 7 to 10 business days.

The approval requirements for the $40K CEBA were not difficult to meet. On or before March 1, 2020, any incorporated company or non-profit relying on their respective CRA Business Numbers and having a Canada Revenue Agency Business Number (BN) could apply for the CEBA. A company or non-profit also needed to be a business with payroll and have a total 2019 payroll of $50,000 to $1 million with the Canada Revenue Agency Business Payroll Number (BN).

There was also an online attestation to sign confirming all the information was correct. Each financial institution had its own form. So, for example, if you applied through The Toronto-Dominion Bank (TD), there was a TD website application attestation.

ceba loan update
ceba loan update

CEBA loan update: Expanded CEBA eligibility requirements

Then there was a CEBA loan update since it was first announced as additional government assistance for businesses’ additional funding. There were changes to the maximum loan balance, eligibility criteria, and other details. As part of the CEBA program extension, businesses that were in operation in Canada on March 1, 2020, were now eligible for a $60,000 grant. Businesses must be all-Canadian corporations, partnerships or proprietorships.

The $60,000 CEBA and $20,000 CEBA expansion financing is not available to other types of business. The $40K CEBA amount already funded automatically qualifies you for the $20,000 CEBA expansion, if you were approved for the $40K CEBA amount in the first place. Now, sole proprietors and partners in business partnerships are also eligible. Corporations owned by family members continue to qualify. Not-for-profit organizations apparently still did not qualify.

To be eligible, applicants for this CEBA loan update had to have a payroll amount between $20,000 and $1,500,000 in the 2019 fiscal year. If not, the expansion allowed them to apply for the non-deferrable expense stream (applicants whose total payroll was $20,000 or less in the 2019 calendar year).

The actual program requirements were written in a funny way. Rather than payroll expenses, it talks about having paid employment income. Apparently, Parliament wanted to emphasize that the money should be used to employ Canadians, so they can earn the employment income being paid by the business payroll!

Eligible businesses are ones that:

  • CRA Business Numbers – has an active business account with a CRA-issued BN registered before March 1, 2020.
  • Has a business chequing/operating account with the proposed lending institution they are applying through when the application process begins. An example would be an account at BMO B M O business banking relationship or a similar account at any other Canadian chartered bank. You should not have any problem meeting this requirement of having an active business chequing account if you have a Canadian operating business.
  • In order to qualify for the entire $60,000 CEBA, applicants must not have previously used the Canada Emergency Business Account Program; they also cannot request support under the CEBA Program at any other financial institution. The $20K loan could be added to the $40K loan that you already received.
  • The plan was to remain open or to reopen as soon as the restrictions were lifted.

CEBA loan update: Repayment terms, rate of interest, other fees and charges

The main provisions of the CEBA term loan are:

  • Business owners have access to a single tranche $60,000 loan through CEBA.
  • Interest is 0% until December 31, 2022.
  • Interest-only until then;
  • Loans are fully open, so the non-forgiven portion of principal repayment can be done in full or in part before January 1, 2023.

    ceba loan update
    ceba loan update

CEBA Forgiveness: Pay it back on time and get free money

To fully repay the loan by December 31, 2022, a borrower needs to repay only a portion of the amounts outstanding. They only need to pay $40,000 of the $60,000 principal, or $30,000 if you only took a $40,000 CEBA loan. If the loan is repaid by 2022, there will be $20,000 forgiven. According to the federal government, this is actually called a loan forgiveness program. This portion represents forgivable loans for early repayment.

After December 31, 2022, any outstanding balance will bear interest at the 5% rate per year for ‘Extended Term.’ Extended Term ends on December 31, 2025. Essentially, the Extended Term converts it to a 3-year term loan after the interest-free period, which is December 31, 2022. Interest will be payable every month on the outstanding principal during this period. No later than December 31, 2025, the full principal balance of $60,000 is due.

CEBA loan update: Default, Notice of Default and Demand for Repayment

There are some CEBA loan update default events. Each default event is fairly straightforward. You may be required to repay a loan if any of the following defaults occur:

  • non-payment under CEBA funding;
  • the repayment of any other business loans not covered by CEBA to the same financial institution is not made under their terms.
  • violation of any term of the CEBA agreement, including making false or deceptive statements in the CEBA application;
  • the business becomes insolvent or commits one or more acts of bankruptcy;
  • a receiver is appointed.

If the borrower defaults, the only recourse for the bank would seem to be to advise the borrower that full repayment is due immediately. A CEBA loan agreement contains no other specifics that grant additional powers to a lender.

Personal guarantees are not included in CEBA loans. The CEBA agreement does state that any successors or personal representatives, including executors and administrators, are bound by the CEBA agreement. When only corporations could apply in the beginning, this language did not make sense. The language now makes sense since the CEBA update expanded CEBA to include sole proprietors and partners, who are people, not companies.

Keep in mind that if you are a sole proprietor or partner in an unincorporated business, the loan was made to you personally. So although there is no personal guarantee, if you run an unincorporated business, you are personally liable.

ceba loan update
ceba loan update

CEBA Loan Update: Now For The 3 Ways For Entrepreneurs To Conquer CEBA Loan Default

In the same way that I mentioned the findings of the CFIB in the introduction to this CEBA loan update Brandon Blog, I’ve been contacted by entrepreneurs who applied for and received the $60K CEBA loan funds only to lose confidence in the financial prospects of their business. The company is still in financial trouble and its operating costs are still greater than the revenue being earned. It is just the case that the business managed to hang on longer. Business owners want to understand the risks associated with CEBA repayment if:

  • their business fails;
  • it closes; or
  • If their financial institution appoints a receiver over the assets due to other loans that are in default or, the business goes bankrupt.

So far, I have informed them of my understanding of CEBA loan terms and CEBA loan default events. Entrepreneurs should also make sure the company’s books and records can demonstrate receipt of the CEBA interest-free loan and that used funds were appropriate for the company’s needs.

So here are the CEBA loan update 3 ways for entrepreneurs to conquer a CEBA loan default:

  1. The first CEBA loan update loan default tip is to relax because right now, nothing is due. Not interest or principal. Interest-only begins on January 1, 2023, and then it is a 3-year term loan with monthly payments of interest calculated at 5% per annum. So if your business is still running, for $250 a month, you can buy yourself another 3 years to see if things get better. Maybe things will look brighter as you get closer to the end of 2022 or 2026, as the case may be.
  2. If the CEBA loan borrower is an incorporated company, relax. You are not personally liable. This is my second CEBA loan update loan default tip.
  3. My third CEBA loan update loan default tip is we need to talk if you are a sole proprietor or partner. Don’t relax. Will you continue your business? Is it possible for the partners to pay off the CEBA loan and obtain a 25% loan forgiveness? I can develop strategies for you to reduce the damage of your personal obligations to the Bank if this isn’t possible.

CEBA loan update summary

I hope you enjoyed this CEBA loan update Brandon Blog post. Are you worried because you or your business are dealing with substantial debt challenges and you assume bankruptcy is your only option? Call me. It is not your fault that you remain in this way. You have actually been only shown the old ways to try to deal with financial issues. These old ways do not work anymore.

The Ira Smith Team utilizes new modern-day ways to get you out of your debt difficulties while avoiding bankruptcy. We can get you the relief you need and so deserve.

The tension put upon you is big. We know your discomfort factors. We will check out your entire situation and design a new approach that is as unique as you and your problems; financial and emotional. We will take the weight off of your shoulders and blow away the dark cloud hanging over you. We will design a debt settlement strategy for you. We know that we can help you now.

We understand that people and businesses facing financial issues need a realistic lifeline. There is no “one solution fits all” method with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. The majority of our clients never do. We help many people and companies stay clear of bankruptcy.

That is why we can establish a new restructuring procedure for paying down debt that will be built just for you. It will be as one-of-a-kind as the economic issues and discomfort you are encountering. If any one of these seems familiar to you and you are serious about getting the solution you need, contact the Ira Smith Trustee & Receiver Inc. group today.

Call us now for a no-cost consultation.

We will get you or your business back up driving to healthy and balanced trouble-free operations and get rid of the discomfort factors in your life, Starting Over, Starting Now.

We hope that you and your family are safe, healthy and secure during this COVID-19 pandemic. Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

ceba loan update
ceba loan update
Categories
Brandon Blog Post

CEBA UPDATE TODAY: OUR SIMPLE HAPPY GUIDE TO CEBA LOAN TERMS

We hope that you and your family are safe, healthy and secure during this COVID-19 pandemic. Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

ceba update

Canada Emergency Business Account (CEBA)

The CEBA is a unique program established by the federal government to help Canadian businesses adversely impacted by the lockdowns and other business interruptions produced by the COVID-19 pandemic. The program was originally developed to help companies and non-profits that need additional funding and some business relief. Absent this Canada Emergency Business Account program, the funding that might be available from financial institutions would not address the Canadian business realities of then or unfortunately, still now.

In my April 13, 2020, Brandon Blog “COVID-19 BUSINESS SUPPORT: CANADA EMERGENCY BUSINESS ACCOUNT REVIEW“, I described the CEBA program. Since then there has been a CEBA update or two. As most of us understand, the economic situation is still refraining from doing much better. I am currently being contacted by companies who got CEBA funds yet still are insolvent and feel they will either need financial restructuring or bankruptcy. The CEBA funds were valuable yet were insufficient now that we are in the 14th month of this health and wellness pandemic.

In this CEBA update Brandon Blog, I want to go over the most up-to-date upgrade on CEBA and answer several of the more typical inquiries I am now being asked when business owners consider an insolvency filing for their company.

The easiest way to answer what the CEBA update is will be to start fresh and describe what the program was back when first announced and what it is today after the CEBA changes.

CEBA update: Original CEBA eligibility requirements

The original CEBA loan requirements went like this. The CEBA online application process showed up on April 9, 2020. PM Trudeau introduced this brand-new program as part of the federal government’s general program to supply COVID-19 business operations assistance to Canadian companies. At that time, the program saw financial institutions providing $40,000 in financing to each qualifying company, guaranteed by the federal government.

The loans were processed and financed by the Canadian chartered banks. Despite its name, the Canada Emergency Business Account is actually not a business account. It is a non-revolving term loan. It is government-guaranteed lending of $40,000, The CEBA are interest-free loans that are not due for repayment until December 31, 2022. If not repaid by then, interest will then accrue.

The CEBA was developed by the Canadian government to supply COVID-19 business operations assistance to small and medium companies and also non-profit organizations with their most immediate cash requirements during the COVID-19 dilemma. The process was all online. The online application process included a CEBA pre-screen tool. The applicant went through the questions and submitted the required information. The system then:

  • provided a CEBA pre-screen tool reference number;
  • told you that the application was submitted through your bank;
  • said your bank really has nothing to do with the application process; and
  • confirmed that you will get an answer within 7 to 10 business days.

The requirements for approval for the $40K CEBA were not difficult to meet. The CEBA was readily available to incorporated companies and non-profits who relied upon their respective CRA Business Numbers and had an operational Canada Revenue Agency Business Number (BN) on or before March 1, 2020. The company or non-profit also needed to be businesses with payroll and have a total 2019 payroll filed under the Canada Revenue Agency Business Payroll Number (BN), between $50,000 and $1 million.

ceba update
ceba update

CEBA update: Is my business eligible for CEBA and its expansion?

The program requirements have since been amended since the original CEBA came out. The maximum loan balance, other program details and eligibility criteria have changed. To qualify as one of the eligible businesses for a $60,000 CEBA the applicant needs to be an operating company that is a proprietorship, partnership or a Canadian-controlled private corporation that was in operation in Canada on March 1, 2020.

Other types of entities are not qualified for the $60,000 CEBA or $20,000 Canada Emergency Business Account expansion financing. If you previously were approved for the original $40,000 CEBA, you know that you can qualify now for the $20,000 CEBA expansion from the initial $40K amount already funded. So now sole proprietors operating a sole proprietorship and partners in business partnerships also qualify. Family-owned corporations always did and continue to qualify. It seems that the non-profit enterprises do not for the CEBA update program.

The CEBA update application process now adheres to 1 of 2 streams: (i) the Payroll Stream (To be considered as eligible businesses, applicants that are businesses with payroll paid under the Canada Revenue Agency Business Payroll Number (BN), in the 2019 fiscal year between a lower limit of $20,000 to a maximum limit of $1,500,000) or (ii) the Non-Deferrable Expense Stream (Applicants who are businesses with payroll paid under the Canada Revenue Agency Business Payroll Number (BN), of $20,000 or less in the 2019 calendar year).

The actual wording in the program requirements is expressed in a funny way. It talks about having paid employment income, rather than a payroll expense as I have described it above. I guess Parliament wanted to emphasize the fact that the money should be used to including employing Canadians so that they will earn the employment income being paid by the business payroll!

Every applicant needs to meet the following eligibility criteria:

  • CRA Business Numbers – has an active business account with a CRA Business Number (BN) registered on or before March 1, 2020.
  • Has an open business chequing/operating account with the proposed lending institution they are applying through at the time the application process is put into play. Examples would be a CIBC Business Operating Account, an RBC Business Deposit Account, or a similar account at any of the other Canadian chartered banks. If you have a Canadian operating business, it should not be too hard to meet this qualification of having an active business chequing account.
  • Those making an application for the complete $60,000 CEBA, have not previously utilized the Canada Emergency Business Account Program and also will not request support under the CEBA Program at any other financial institution.
  • Plans to stay open or to go back to opening up as soon as restrictions are lifted.

CEBA update: Non-deferrable expense stream eligibility

If you are applying under the Non-Deferrable expenditures stream, you have to, in addition, comply with some extra eligibility criteria as follows:

  • Having verifiable non-deferrable expenses between $40,000 and $1,500,000. Eligible non-deferrable expenses can consist of operating costs like property rental fees, real estate tax, insurance policy protection, and utilities. The government says that expenditures for such non-deferrable operating expenses will certainly undergo confirmation and audit, presumably by Canada Revenue Agency.
  • Submitted an income tax return with the CRA with a tax year ending in 2019 or, if its tax return for fiscal 2019 is not yet due for filing, 2018.

As always, as soon as you have actually finished the online application via your bank, the Government of Canada will examine the application as well as alert you and your bank of the approval or decline of the funding. Your financial institution will put the funds right into your business chequing/ operating account if you are successful.

So this is how the CEBA expansion has changed the eligibility requirements resulting from the CEBA update. It is obvious that the government wants to help businesses have the necessary cash on favourable terms to make necessary expenses for business purposes.

The CEBA update has also extended the CEBA Application Period. The CEBA update also has now extended the to receive applications from businesses to June 30, 2021, (proposed in the recent Budget to be extended to the Fall of 2021) to request a $60,000 CEBA or the $20,000 expansion at their financial institution. Unless the government announces an extension to this date, time is running out.

ceba update
ceba update

CEBA update: How many businesses have applied for CEBA?

Here are the statistics of the use of the CEBA program during this difficult time as of this date:

  • 866,750 businesses were approved for CEBA loans;
  • 532,899 businesses were approved for the CEBA update expansion; and
  • funds were loaned as a result of the above total $46.56 billion.

What are the CEBA loan terms and is there any CEBA event of default?

The most well-known CEBA term loan provisions are:

  • The CEBA program supplies access to a $60,000 business loan.
  • 0% interest till December 31, 2022.
  • No principal payments until after December 31, 2022.
  • The loan is fully open so, all or part of the non-forgiven portion can be repaid prior to January 1, 2023.
  • Full repayment by December 31, 2022, will only require the borrower to repay $40,000 of the total $60,000 loan for it to be considered fully repaid. Therefore, there is loan forgiveness of $20,000 if repaid by the end of 2022. The federal government is actually calling this loan forgiveness for early repayment.
  • The interest rate on any outstanding balance after December 31, 2022, is 5% per annum during the “Extended Term”. The Extended Term runs until December 31, 2025. So after the interest-free period, the Extended Term converts it to a 3-year term loan after December 31, 2022, the Initial Term Date. During the Extended Term, monthly interest payments are required. The full principal balance of $60,000 is due no later than December 31, 2025.

There are some CEBA update loan events of default as follows:

The events of default are quite simple. The bank may need you to pay back the loan, upon the incident of any kind of among the following events of default:

  • you fail in paying any amount due under the CEBA funding;
  • you don’t pay according to its terms any other non-CEBA financing outstanding to that same financial institution;
  • you fail to comply with any one of the terms of the CEBA agreement (which really revolves around interest and repayment), you make any false or deceptive statements to the bank, including without restriction, in your CEBA application;
  • the business commits an act of bankruptcy or becomes insolvent; or
  • the business is placed in receivership.

It would appear that the only remedy for the bank upon the default of the borrower is to advise that full repayment is due immediately. There are no other specifics in the CEBA loan agreement providing the lender with any other powers.

There is no personal guarantee attached to this CEBA loan. However, there is some language that speaks to the CEBA agreement being binding on “your heirs, your successors and personal representatives – including executors and administrators”. This language did not make any sense when only corporations could apply in the beginning. The language now makes sense because the CEBA update created the CEBA expansion to include sole proprietors and partners, who of course, are people, not companies.

I have received some calls from entrepreneurs who applied for and obtained the CEBA $60K loan expansion funds. Their company is still in financial trouble; it was just able to hang on longer. The business owners want to know if their company has to enter into an insolvency proceeding, what is their risk as it relates to the CEBA repayment?

To date, I have advised them of my understanding of the CEBA loan terms and CEBA loan events of default as outlined above. I also caution entrepreneurs that the company books and records should be able to show both the receipt of the CEBA interest-free loan and that the funds were used for appropriate business purposes.

ceba update
ceba update

CEBA update summary

I hope you enjoyed this CEBA update Brandon Blog post on the current rules for the Canada Emergency Business Account. This is one of several government programs to hopefully allow business continuity to survive.

Are you worried because you or your business are dealing with substantial debt challenges and you assume bankruptcy is your only option? Call me. It is not your fault that you remain in this way. You have actually been only shown the old ways to try to deal with financial issues. These old ways do not work anymore.

The Ira Smith Team utilizes new modern-day ways to get you out of your debt difficulties while avoiding bankruptcy. We can get you the relief you need and so deserve.

The tension put upon you is big. We know your discomfort factors. We will check out your entire situation and design a new approach that is as unique as you and your problems; financial and emotional. We will take the weight off of your shoulders and blow away the dark cloud hanging over you. We will design a debt settlement strategy for you. We know that we can help you now.

We understand that people and businesses facing financial issues need a realistic lifeline. There is no “one solution fits all” method with the Ira Smith Team. Not everyone has to file bankruptcy in Canada. The majority of our clients never do. We help many people and companies stay clear of bankruptcy.

That is why we can establish a new restructuring procedure for paying down debt that will be built just for you. It will be as one-of-a-kind as the economic issues and discomfort you are encountering. If any one of these seems familiar to you and you are serious about getting the solution you need, contact the Ira Smith Trustee & Receiver Inc. group today.

Call us now for a no-cost consultation.

We will get you or your business back up driving to healthy and balanced trouble-free operations and get rid of the discomfort factors in your life, Starting Over, Starting Now.

We hope that you and your family are safe, healthy and secure during this COVID-19 pandemic. Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

ceba update
ceba update
Categories
Brandon Blog Post

TO DEBT DO US PART BUT I CAN’T PART WITH MY LIFE-CHANGING COVID-19 ECONOMIC RESPONSE PLAN

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

To debt do us part introduction

To debt do us part many times is confused with Til Debt Do Us Part. That of course was the Canadian television series created by Frantic Films for Slice in Canada, Zone Reality in the UK as well as CNBC in the United States. It was hosted by Gail Vaz-Oxlade, who weekly advised a couple that is in debt and also having troubles in their marriage or relationship.

Over the last couple of days, I read two crazy articles involving what people have done with federal coronavirus relief money. One from the United States and the other from Canada:

The title catchphrase to debt do us part seems particularly apt to me in the context of the Canadian federal government COVID-19 Economic Response Plan to assist Canadians and their companies. Especially if people are going to do crazy things with money they desperately need to live on.

With that as the backdrop, I thought it would be a good time in this Brandon’s Blog to review where we are at this stage of the pandemic and why no matter how much good information about money management there may be available to people, some will insist on to debt do us part.

This 2020 to debt do us part is something brand new

The economic pain and worry Canadians and businesses are experiencing this time around is something brand-new. It is hitting people and companies that have always made their repayments on time. To debt do us part was never part of their vocabulary or lifestyle. They’ve never needed to get a deferral. It is very unpleasant and unsettling. To debt do us part is a very real worry for every Canadian today.

Now that the majority of us have remained in quarantine, we’ve had a lot of time to look at our money behaviours. Have they transformed since we’ve been able to take a look at our cash? Are we most likely to be taking a look at it differently now moving forward? I say yes. I don’t assume any person is going to exit this COVID-19 pandemic unscathed financially.

I have been blogging for years about the need for every Canadian to have in their monthly budget a line item for putting savings into an emergency fund in case of an unforeseen crunch. Before the lockdown, many Canadians were in trouble already. In the 3rd quarter of 2019, we saw household debt to income numbers at around 176%. So that statistic means that for every single dollar we brought in, we owed $1.76. Typically, for an emergency reserve, you should have 3 to 6 months of liquid funds readily available to you. Most Canadians did not.

An emergency fund doesn’t have to be in a very low interest-bearing savings account that you can go to an ATM for. Certainly, it also didn’t need to be cash stuffed in your mattress in the house. It could have been in the form of financial investments that could be liquidated fairly quickly without suffering a loss, should an emergency arise and you needed to get your hands on some money quickly.

By an emergency situation I mean something like a major medical expense, being laid off of work or something like this coronavirus pandemic causing you a loss of earnings such as now being experienced by lots of people as our economy shut down.

The government had no choice for to debt do us part

As a result of so many people being so scared and facing to debt do us part in the face, the federal government had no choice but to come up with a support package for Canadians and Canadian companies. The combination of support programs is wrapped up in the omnibus title of the COVID-19 economic response plan. I have written before on many of the support programs. The federal assistance programs for Canadian business include:

When government support ends to debt do us part

The Canadian federal government had no choice but to provide an aid bundle for Canadians. This point highlights the truth that maybe most Canadians were not prepared with an emergency fund. To debt do us part was part of their everyday life. Unlike the two people in the articles I mentioned in the introduction to this Brandon’s Blog, I think this has been a big wake up call for a lot of people about their to debt do us part.

This is not the moment to be talking to your lender for new credit when you have too much debt. However, it is a perfect time to start thinking about your monthly after-tax income and your monthly spending. You want to get that under control so that you are not spending more than you earn and that your monthly budget has a line for your emergency fund savings. You need to first get on the solid monetary ground while the government’s support programs are still in force.

But what happens to debt do us part when the support programs and the various deferral programs offered by the banks end? In several previous blogs, I hypothesized that the Canadian government cannot end the programs on the original end dates of September 1, 2020. My feeling was that Canadian people and companies would not be ready to go from support to no support so drastically and would have to extend the programs potentially until the end of the 2020 calendar year. Some of these blogs were:

Since then, the federal government has announced several extensions to certain programs:

  • Canada Revenue Agency (CRA) is expanding the payment due day for existing year personal, company, and trust tax returns, including instalment payments, from September 1, 2020, to September 30, 2020.
  • The federal government will give eight added weeks of benefits for people whose jobs or income have actually disappeared as a result of the COVID-19 pandemic, however, only if they look for a job and take one when it’s reasonable to do so.
  • A CEWS extension that will prolong the program up until November 21, 2020, with the intent to supply additional support up until December 19, 2020.

So with these extensions providing extra support, now is the time for everyone to try to get their financial house in order.

How do people avoid to debt do us part in the first place?

I was asked recently in a Facebook business group I belong to:

How do people better put themselves in better financial health in the first place?

My answer was:

That is a great question. It all has to start with understanding clearly your monthly after-tax income, monthly expenses and having a budget that you follow. Each month the budget must include putting something away to an emergency fund and making sure that your income tax is being paid regularly. So that what you are spending is truly after-tax money. All of that can be summed up as living within your means. That goes for your business too.

So while there are still government support programs, now is the time to take a hard critical look at your financial situation and make concrete plans to try to avoid the realities of to debt do us part.

People were already teetering on solid ground. It’s most likely to underscore the value of actually meeting with an expert if you do not know how you get out of this debt on your own. Sitting down with someone like a qualified financial advisor, a community-based credit counsellor or a licensed insolvency trustee is what you need to do.

If the debt is howling at you, you need to really have a strategy to get out of it. When you intend to drop weight, you seek a weight reduction program to educate you. You may additionally choose a personal trainer to help you with an exercise program. So, why not locate somebody to assist you and educate you to shed your debt as well as keep it in control?

You do not need to do that all on your own. It’s going to take some imagination, maybe some cost-cutting, maybe some increased revenue or a combination of all of these. We’re not out of this yet, and eventually, the deferrals and support programs will end. Take action now so that you can have a clear path going forward. Nobody says it will be easy, but to debt do us part does not have to be part of your life forever.

Payday loans and credit card advances are not the answer to debt do us part

Something individuals in the red can refrain from doing is trying to go deeper into debt by raising money on a brand-new debt to repay an old one. When you already have too much debt, the only likely source for this kind of cash that I see is either cash advance on an existing charge card or a payday loan. Regardless, you will be paying a lot more interest than on the original financial obligation you are attempting to refinance.

Payday loans are extremely easy to get. You can go shopping online. You can have cash in your account within a couple of hours. The issue is, depending on the province that you’re in, these are astronomical interest rates as high as 600 percent. It might fix that short-term issue, but what you’re mosting likely to have to handle in the future normally winds up being more payday advances rolling right into a really negative situation. Very same with the cash advance from your credit card. Not as bad as payday loans, however still 20% to 29% rate of interest doing that.

The courts are shut now. Financial institutions are not chasing anybody. People are still obtaining those deferrals. You are not having to pay tax obligations. You can defer paying your tax obligations until the end of September.

So as quickly as we get back to a “new normal”, creditors will certainly begin to call. You will certainly have to pay your mortgage, your taxes and your various other costs. Will that be something people will have the ability to afford? While we still have this “break”, it is actually the very best time to look at your overall picture, your revenue and also expenditures, your month-to-month spending plan. It is additionally the best time to get the expert help you need if you can not do it on your own. This is the ideal time to map out a strong strategy.

To debt do us part summary

I hope you have found this to debt do us part Brandon’s Blog interesting and helpful. The Ira Smith Team family hopes that you and your family members are remaining secure, healthy and well-balanced. Our hearts go out to every person that has been affected either via misfortune or inconvenience.

We all must help each other to stop the spread of the coronavirus. Social distancing and self-quarantining are sacrifices that are not optional. Families are literally separated from each other. We look forward to the time when life can return to something near to typical and we can all be together once again.

Ira Smith Trustee & Receiver Inc. has constantly used clean, safe and secure ways in our professional firm and we continue to do so.

Income, revenue and cash flow shortages are critical issues facing entrepreneurs, their companies and individual Canadians. This is especially true these days.

If anyone needs our assistance for debt relief Canada COVID-19, or you just need some answers for questions that are bothering you, feel confident that Ira or Brandon can still assist you. Telephone consultations and/or virtual conferences are readily available for anyone feeling the need to discuss their personal or company situation.

The Ira Smith Trustee Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

to debt do us part
to debt do us part

 

Categories
Brandon Blog Post

CANADA EMERGENCY WAGE SUBSIDY: HELPING YOUR COVID-19 BUSINESS RECOVERY

The Ira Smith Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Stay healthy, well balanced and safe and secure everyone.

Introduction

Statistics Canada says the annual cost of living rate went negative in April as the economy came to a standstill in the very first full month of the pandemic. The agency says the consumer price index for April fell 0.2 percent compared with a year ago as energy rates did a nosedive. It was the very first year-over-year decline in the CPI since September 2009. As a result, on May 15, Prime Minister Justin Trudeau announced some amendments to existing Federal government support programs, including the Canada Emergency Wage Subsidy program, to help during this COVID-19 pandemic.

Millions of Canadians have actually lost their jobs due to the COVID-19 pandemic. As our economic recovery gradually begins, any place feasible to do so securely, Canadians need to return to work. Businesses opening up again safely will bring life back into the Canadian economic climate. That is exactly why the federal government generated the Canada Emergency Wage Subsidy (CEWS) (initially called the Canada Emergency Response Benefit) in March.

Canada Emergency Wage Subsidy extended

I have previously written about the federal government assistance programs to help both workers and employers. The overall umbrella name for all the programs is the COVID-19 Economic Response Plan. When the CEWS program was launched, critics quickly pointed out that it did not cover all types of businesses. They also wondered if the original program, scheduled to end June 30, was long enough to really help the economy.

On May 15, PM Trudeau introduced amendments to the program to help businesses get ready for reopening. These companies need to be able to rehire workers and with any luck perhaps hire even more than they had when the state of an emergency shutdown was declared. So, the CEWS is extended for 3 extra months to August 29. The CEWS covers 75% of an employee’s salaries– up to $847 per week – for eligible employers. For those able to additionally benefit from the Temporary 10% Wage Subsidy for a period, any credits taken under that program for a pay period will decrease the amount available to be claimed under the CEWS for that exact same time period.

The 1 part of your business your customers are most worried about

So businesses currently have some runway to get restarted. This is a good thing as businesses will certainly need funding to reactivate. Specific businesses might need a few extra staff members than they had before the shutdown. I just read this morning an article about what restaurants and other businesses may have to do to make customers feel at ease about returning.

The one area of the business that people might fear is the washroom. The article raises the following questions that should be answered before reopening:

  • How many people can be in there at one time?
  • Is every other urinal in the men’s room going to have to be sealed off?
  • Are the barriers between stalls and urinals sufficient?
  • Do the sinks have automatic taps or will patrons have to use the handles to turn on the water?

So a new job category that really hasn’t been seen much since the early 1960s might just come back – the washroom attendant. The business will have to make sure they can prove to their customers and clients that the washrooms are being cleaned on a very regular basis. Someone will have to make sure that there are only a limited number of people in a washroom at one time so that social distancing can be maintained. This could lead to new jobs!

Other amendments to the CEWS

The CEWS will ideally keep encouraging companies to rehire staff and even broaden where possible. The federal government has actually pledged, for moving forward, that it will work with company and labour stakeholders on any other changes that might be required.

Among the important things, they will certainly be looking at the 30% income drop limit for eligibility. As companies start-up, satisfying that revenue test should not be an obstacle to growth. Although all businesses require aid, certain ones could not fulfill the revenue decline test. There are two main factors. The revenue decline examination is on a monthly basis. Considering that the first half of March businesses were operating normally, many could not meet the test for that month. Startup companies probably couldn’t either.

Other businesses did not qualify not because of the revenue decline test, but because their business did not meet the original definition. So, Justin Trudeau announced broadened eligibility for the CEWS benefit. Previously, only corporations and charitable organizations were eligible employers for this wage subsidy benefit. Now the list has been expanded.

The eligible employer list has now been expanded and includes:

  • individuals (including trusts)
  • taxable corporations
  • persons that are exempt from corporate tax (Part I of the Income Tax Act), other than public institutions:
  • non-profit organizations
  • agricultural organizations
  • boards of trade
  • chambers of commerce
  • non-profit corporations for scientific research and experimental development
  • labour organizations or societies
  • benevolent or fraternal benefit societies or orders
  • registered charities
  • partnerships consisting of eligible employers

Public institutions continue to not be eligible for the subsidy. This includes municipalities and local governments, Crown corporations, public universities, colleges, schools and hospitals.

Canadian Emergency Business Account (CEBA)

In my April 13 blog, COVID 19 BUSINESS SUPPORT: CANADA EMERGENCY BUSINESS ACCOUNT REVIEW, I described the CEBA in detail, as the program then existed. On May 15, at the same time, he was announcing the extension and changes to the CEWS, PM Trudeau also announced an expansion of the CEBA program. The expansion is meant to include an important part of the Canadian economy that was previously excluded. I think the exclusion was inadvertent, in the government’s rush to get the program out. So Justin Trudeau announced that the CEBA program will also now include:

  • Sole proprietorships/partnerships.
  • Any other form of owner-operated businesses.
  • Businesses that hire contractors but not employees, so they do not have a payroll account with the Canada Revenue Agency.
  • Family-owned businesses where remuneration is paid via dividends, not salary.
  • Businesses where the proprietor uses a personal bank account for business purposes rather than a business operating account.
  • Newly created businesses.

This should go a long way to removing previous inequities in the CEBA program.

So now, the list of ineligible businesses is relatively narrow, being:

  • A government organization or body, or an entity owned by a government organization or body.
  • A union, charitable, religious or fraternal organization or an entity owned by such an organization or if it is, it is a registered T2 or T3010 corporation that generates a portion of its revenue from the sales of goods or services.
  • A business owned by any Federal Member of Parliament or Senator.
  • One that promotes violence, incites hatred or discriminates on the basis of sex, gender identity or expression, sexual orientation, colour, race, ethnic or national origin, religion, age, or mental or physical disability, contrary to applicable laws.

Summary

I hope you found this Canada Emergency Wage Subsidy Brandon’s Blog helpful. It should be of particular interest to contractors, developers and builders in Ontario.

The Ira Smith Team family hopes that you and your family members are remaining secure, healthy and well-balanced. Our hearts go out to every person that has been affected either via misfortune or inconvenience.

We all must help each other to stop the spread of the coronavirus. Social distancing and self-quarantining are sacrifices that are not optional. Families are literally separated from each other. We look forward to the time when life can return to something near to typical and we can all be together once again.

Ira Smith Trustee & Receiver Inc. has constantly used clean, safe and secure ways in our professional firm and we continue to do so.

Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. This is especially true these days.

If anyone needs our assistance, or you just need some answers for questions that are bothering you, feel confident that Ira or Brandon can still assist you. Telephone consultations and/or virtual conferences are readily available for anyone feeling the need to discuss their personal or company situation.

The Ira Smith Team is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Stay healthy, well balanced and safe and secure everyone.canada emergency wage subsidy

 

Categories
Brandon Blog Post

COVID 19 BUSINESS SUPPORT: CANADA EMERGENCY BUSINESS ACCOUNT REVIEW

covid 19 business support

If you would prefer to listen to the audio version of this Brandon’s Blog, please scroll to the bottom and click play on the podcast

The Ira Smith Team is totally operational and both Ira and Brandon Smith are here for a telephone consultation, conference calls and virtual meetings.

Keep healthy and safe everybody.

Introduction

The full information about the Canada emergency business account (CEBA) is now revealed. The Canada emergency business account application form, full details and the online-only application procedure appeared on April 9, 2020. Prime Minister Trudeau announced that this new program as part of the federal government’s overall program to provide COVID 19 business support. This program will see financial institutions supplying $40,000 in a loan guaranteed by the federal government. The loans are being processed and administered by the Canadian banks. The CEBA is really not a business account. It is a government-guaranteed loan of $40,000 that is interest-free till December 31, 2022.

In Brandon’s Blog, I will describe who qualifies for a CEBA and how it works. I will also point out some issues, which from what I can tell, have not yet been reported in the media.

The Ira Smith Team family hopes you and your loved ones are staying secure, healthy and balanced. We pray for every person that has been affected either through inconvenience or tragedy.

If you need our assistance, rest assured that Ira or Brandon can still assist you. We, of course, are not meeting anyone face to face. Telephone consultations and/or online meetings are available for anybody who has any questions or concerns they wish to discuss, either in a personal or business scenario.

The Canada emergency business account program

The CEBA has actually been specifically created by the Canadian government to provide COVID 19 business support to small and medium enterprises (SMEs) and non-profit organizations (NPOs) with their most immediate cash requirements during the COVID-19 crisis. The federal government will provide as much as $25 Billion to finance the CEBA program. The CEBA is a federal government assured funding to each qualified business of $40,000 that is interest-free up until December 31, 2022.

Loans under the CEBA will be interest-free for the first year and a half. As well, 25% of the loan, or $10,000, will be forgiven if the other 75% is repaid by the end of 2022.

“Don’t worry ’bout a thing, cause every little thing’s gonna be alright.” – Bob Marley

Canada emergency business account requirements

So who qualifies for the $40K CEBA? The requirements in order to qualify for a CEBA are not hard to meet. The CEBA is only available to incorporated companies and NPOs who have a registered federal business number that was operational on or before March 1, 2020. The CEBA is open to SMEs and NPOs with a total 2019 payroll between $50,000 and $1 million.

The CEBA COVID-19 business support plan is made to supply much-needed relief for Canadian SMEs and NPOs. It helps them to take care of and sustain them through this tough time. The CEBA is not available to proprietorships or partnerships. Therefore it is not available to the self-employed who did not set up their business through a corporation.

On the one hand, this might exclude an important group of businesses in Canada. On the other hand, when you think about it further, it makes sense. Given the extent of the underground economy in Canada, I doubt there are any unincorporated businesses in Canada with employees that in 2019 have run a payroll account, taken deductions and remitted them to Canada Revenue Agency. More than likely any unincorporated business in Canada that does have employees operates on a cash basis!

COVID 19 business support through small business relief

I have seen the CEBA described in the press as a federal program that will provide a $40,000 line of credit to qualified businesses at 0% interest until Dec. 2022. The CEBA is actually a one-time loan. It is not a revolving line of credit. What that means is that if approved, the SME or NPO gets the COVID 19 business support and receives the full $40,000 loan in one tranche upon approval. It then gets repaid according to its terms (further discussed below).

A traditional line of credit lets you borrow what you need up to your authorized amount. Then, when you deposit money into the account associated with the line of credit, the line automatically goes down by that amount. That then gives more borrowing room equal to the amount of your deposit. The CEBA does not work that way. It is a term loan, with specific repayment and default provisions. Once you make a partial payment against the loan, you cannot borrow against it further.

“Keep calm and carry on,” – British government WWII posters

The Canada emergency business account how to apply

The CEBA application process for COVID-19 business support is done all online. You apply through your bank where your corporation or non-profit keeps a business account. The application process is very simple. The best way is to show you.

So this is the application for the CEBA form. As you can see there are just a few steps you have to do to apply. You have to attest that:

  • you have the authority to bind the corporation
  • it is an operating business since March 1st 2020; and
  • that you have a federal tax registration number

You need to supply:

  • your CRA business number; and
  • that total employment income paid in 2019 is between $50,000 and $1 million.

You need to know that you can prove that amount by providing the 2019 T4 summary.

You have to have an active business and a business chequing operating account with the lender you are applying through for 90 days or more. You can only apply for the program once. Once approved, you cannot apply again through a different financial institution.

You must acknowledge that:

  • you might have to answer some surveys;
  • you have to not be a government organization or union that generates a portion of its revenue carrying on active business;
  • the owner doesn’t hold political office and
  • that your business does not promote violence, hatred, discrimination.

Then you have to click the box to certify you are in agreement with those conditions and that the information you provided is true and correct. Then you need to fill in the:

  • legal business name;
  • phone number;
  • email address;
  • bank branch and account numbers;
  • the business account number;
  • The business address; and then
  • your information as the business owner

You should read the loan agreement and the privacy agreement. Once completed, you click the checkbox to acknowledge that you read those documents, you agree to the terms and then click the submit button which will open up after you put in all the information and check the required boxes.

“The only thing we have to fear is fear itself” – President Franklin Roosevelt’s 1933 inaugural address

Canada emergency business account details important to know

There are some details in the loan agreement that everyone applying needs to know. Nothing I am going to tell you is meant to say do not apply for this COVID 19 business support. The opposite is true. Every business that needs this government-assisted loan should apply. I just want to provide value to you by pointing out some issues not publicized in the media.

The loan agreement is relatively simple. It sets out the terms and conditions of the loan being made. Here are the details:

  1. Loan amount: $40,000
  2. Initial term date: December 31, 2022
  3. Extended term date: December 31, 2025
  4. Interest rate: 0% per annum during the initial term. 5% per annum during the extended term
  5. First interest payment date: January 31, 2023
  6. Frequency of interest payments: monthly

At any time during the term of the loan, you may prepay all or any portion of it without penalty. If you have repaid at least 75% of the loan amount on or prior to December 31, 2022, the bank will forgive the remaining balance of the loan amount provided that an event of default has not occurred (more on that soon).

“A life lived in fear is a life half lived,” – Baz Luhrmann, director and co-writer of the 1992 Australian film “Strictly Ballroom”

Canada emergency business account – apply carefully

Now, the details that I am going to tell you will show you that you have to be careful which bank where your SME or NPO has a bank account you apply to. The $40,000 loan is deposited into your business account. Your business account will continue to operate in the normal course.

If there is a negative balance in your business account, as a result of an overdraft facility or otherwise, the proceeds of the loan will automatically repay the amount outstanding up to the loan amount.

So, if you are running an overdraft, first, the bank gets paid off. So in that case, you don’t get the full $40,000 to put into your business. This is obviously a perk to the banks provided by the federal government.

Next is the events of default. It is pretty simple. The bank may require you to repay

the loan, upon the occurrence of any one of the following events of default:

  1. you default in paying any amount due under the CEBA loan;
  2. you default in paying any other loan to the bank;
  3. you fail to comply with any of the provisions of the CEBA agreement (which are not onerous), you make any false or misleading representation to the bank, including without limitation, in your CEBA application;
  4. The SME or NPO commits an act of bankruptcy or becomes insolvent; or
  5. a receiver is appointed for the business or any part of its property.

So this is why I say that if you have a business account at more than one bank for at least 90 days before March 1, 2020, you need to choose wisely which bank you apply through. As I already said, if you are running an overdraft at the bank, the first proceeds of the CEBA loan will go to pay off that overdraft. Second, if you choose a bank where you have other loans, if you default on any loan with that bank, not only is it an event of default on that loan, it is also an event of default under the CEBA loan.

“Worry is like a rocking chair: It gives you something to do but never gets you anywhere,” – Erma Bombeck

Although the CEBA is an unsecured loan, the bank has been given the right to call a default under the CEBA if you have done something unrelated to cause a default in another loan product. So, for example, if you have an event of default under your operating or capital term loan, that will cause a default in the CEBA also.

The loan is not personally guaranteed by the person applying on behalf of the SME or NPO. However, the loan agreement reads that it is binding “…on you, your heirs, your successors and personal representatives – including executors and administrators”. Now the words “You”, “Your” and “Yours” are defined in the loan agreement to mean the recipient of the loan under the CEBA agreement.

As far as I can tell, the applicant is the SME or NPO. I am not sure how those legal entities can have executors. Also, how could the agreement be binding on me personally or my heirs? Does that mean anyone who applies on behalf of their SME or NPO has personally guaranteed the CEBA loan? It looks that way, however, there is no express provision that the loan is personally guaranteed, other than for the wording I have shown you.

So that is what CEBA COVID-19 business support is all about. I applaud the federal government for this initiative. Whether it will be enough, along with the wage support that I previously wrote about, only time will tell.

“Nothing in life is to be feared, it is only to be understood. Now is the time to understand more, so that we may fear less.” – physicist Marie Curie

Summary

The Ira Smith Team family hopes you and your family are staying safe, healthy and well-balanced. Our hearts go out to every person who has been affected either through inconvenience or personal family tragedy.

We are all citizens of Canada and we have to coordinate our efforts to stop the spread of the coronavirus. Social distancing and self-quarantining are sacrifices that are not optional. Family members are literally separated from each other. We look forward to the time when things can return to something close to normal and we can all be together again physically.

Ira Smith Trustee & Receiver Inc. has always employed clean and safe habits in our professional practice and continues to do so.

Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Should you take advantage of the CEBA? I say a resounding YES!. I just wanted to highlight all of the issues that you should consider.

If anyone needs our assistance, feel confident that Ira or Brandon can still assist you. Telephone consultations and/or virtual conferences are readily available for anyone feeling the need to discuss their personal or company situation.

Are you now worried just how you or your business are going to survive? Those concerns are obviously on your mind. This pandemic situation has made everyone scared.

“Don’t worry, be happy” – Bobby McFerrin

The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious.

It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now.

We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you.

We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel.

Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.

The Ira Smith Team is totally operational and both Ira and Brandon Smith are here for a telephone consultation, conference calls and virtual meetings.

Keep healthy and safe everybody.

“Things could always be better, but things could always be worse,” – Marla Gibbs

Call a Trustee Now!