prime minister justin trudeau Archives - Ira SmithTrustee & Receiver Inc.

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.

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

CEWS extension introduction

On Friday, July 17, 2020, the federal government made an announcement regarding the Canada Emergency Wage Subsidy (CEWS). The CEWS extension deals with both extending the date the program continues to and also amends some of its provisions.

This Brandon’s Blog discusses the proposed changes announced by Finance Minister Bill Morneau. I caution that this is merely an announcement about the Liberal government’s intention to make a legislation change. Right now there is no new legislation on the books so the final CEWS extension may look different than what was announced.

CEWS status prior to the July 17 announcement

The CEWS was put in place for an initial 12-week duration from March 15 to June 6, 2020, giving a 75-per-cent wage aid to eligible companies. In my May 20, 2020 blog, CANADA EMERGENCY WAGE SUBSIDY: HELPING YOUR COVID-19 BUSINESS RECOVERY, I wrote about Prime Minister Justin Trudeau introducing on May 15, 2020, amendments to the program to aid businesses to prepare for reopening. These companies needed to be able to rehire workers laid off when the state of an emergency closure was proclaimed.

Justin Trudeau’s May announcement was of a CEWS extension for 3 extra months to August 29. The CEWS covers 75% of a staff member’s wage or salary – as much as $847 per week – for qualified employers. For those able to in addition gain from the Temporary 10% Wage Subsidy for a period, any kind of credit taken under that program will decrease the total to be declared under the CEWS for that precise same period.

Another CEWS extension was inevitable

CEWS is just one of many support programs under the federal government’s COVID-19 Economic Response Plan. In my July 8, 2020 blog, CANADIAN BUSINESS: WHAT WILL BE THE ULTIMATE BUSINESS IN ONTARIO RECOVERY PROGRAM?, I talked about not only the inevitability of a CEWS extension but of extensions for the other government support programs. It is not that I am some insightful visionary, it is just as simple as the coronavirus is not going away. Similarly, the financial pain being experienced by entrepreneurs and their companies and by ordinary people is also not going away.

Everyone will certainly need to stand on their own 2 feet just like they needed to prior to the COVID-19 pandemic. Until the CEWS extension news last Friday, the Canadian company assistance programs were all set up to end August 31. I asked the question “What will take place then?”.

My personal idea was that the government will certainly not be able to finish the financial assistance programs that soon. Instead, I wrote they will certainly have to prolong all the programs once more. They may modify them to start the process of weaning Canadians off of COVID-19 Economic Response Plan assistance. However, they would certainly need to be extended.

I wrote that the government would not intend to extend for more than 90 days, however, Xmas would come shortly after the expiry of a 90-day extension, pandemic or no pandemic. The only part that I got wrong was that the government would not want to shut down the faucet prior to Christmas. So, I wrote that it suggested an extension until January 1, 2021. I also don’t see one thing in the CEWS extension that I predicted. That the government will accompany the new extension with an alert to every Canadian to get their affairs in order since there will certainly be no more assistance programs after December 31.

As I will explain below, I did not see such a warning in last Friday’s announcement.

The CEWS extension

The CEWS safeguards jobs by helping organizations maintain workers on the payroll and also motivating companies to re-hire employees formerly laid off. The Canadian government says that since the CEWS was launched, 3 million Canadian workers have actually had their work sustained, and that number continues to expand.

Finance Minister Bill Morneau revealed last Friday that the CEWS extension would include program changes that would widen the reach of the program. It would also offer much better-targeted assistance to ensure that more workers can return to their jobs promptly as the economy reboots.

The proposed modifications included in the Federal government’s draft proposed legislation for the CEWS extension would:

The CEWS extension will prolong the program until November 21, 2020, with the intent to supply additional support until December 19, 2020.
Make the subsidy obtainable to a more comprehensive range of companies by consisting of employers with a revenue decrease of less than 30 percent and also offering a slowly lowering base aid to all eligible employers. This would help numerous employers with less than a 30% revenue loss obtain assistance to keep employees.
Introduce a top-up subsidy of approximately an extra 25 percent for employers that have actually been most adversely affected by the pandemic. This would be especially practical to companies in industries that are recovering much more slowly.
Offer certainty to companies that have actually already made company decisions for July and August by ensuring they would not have their subsidy lower than they would have had under the previous policies.
Address specific concerns recognized by stakeholders.

These recommended adjustments come from consultations with labour and business representatives on making certain that the CEWS extension remains to save jobs and help with economic growth.

By helping employees shift back to their jobs and sustaining companies as they boost revenue, these adjustments go to give support to companies to have some certainty that they need to bring back workers.

There are other government subsidy programs too

The federal government continues to evaluate as well as react to the impact of COVID-19 and stands ready to take extra actions as required to maintain the economy. So, perhaps we will see announcements soon, just like the CEWS extension announcement, to extend:

More time to pay income taxes
Canada Emergency Business Account interest-free loans
Loan Guarantee for Small and Medium-Sized Enterprises
Canada Emergency Response Benefit (CERB) for the self-employed business people and Canadian workers.
Canada Emergency Commercial Rent Assistance (CECRA)

Only time will tell. I will certainly keep you updated as more announcements are made.

“We are ensuring that Canadians are able to get back to work as quickly as possible. The adjustments we are proposing would ensure that the CEWS continues to address Canadians’ needs while also positioning them for growth as economies continue to gradually and safely reopen.” – Bill Morneau, Minister of Finance

CEWS extension summary

I hope you have found this CEWS extension 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.

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

The Ira Smith Team is absolutely operational and both Ira, as well as Brandon Smith, are right here for a telephone appointment, conference calls and also virtual meetings.

Stay healthy and safe everybody.

Introduction

I want to describe what is known right now about the most recent Canadian small business relief program. The program named the Canada Emergency Commercial Rent Assistance (CERC) Program was set up to help small companies cover their commercial rent payments for April, May and June. This kind of program is necessary because of the COVID-19/coronavirus pandemic.

The latest small business relief program announcement

On Friday, April 24, Prime Minister Justin Trudeau announced the launch of the CERC for small companies that have been strongly impacted by the coronavirus pandemic. It is designed to reduce rental costs by 75 percent for impacted local businesses.

The CERC will provide forgivable loans to commercial landlords that qualify under the plan to cover half of the three regular monthly rent payments. It is designed to help small businesses experiencing financial difficulty throughout April, May and June.

The expense and management of the CERC will be shared by the provincial and federal governments. It should be accessible by mid-May.

“A big business starts small.”
-Richard Branson

The Ontario program

Since I practise in the province of Ontario, that is the provincial program I will comment on. Other than for the level of money contributed, presumably, the federal program works the same way in all provinces. When all the details come out, we will then know for sure.

The Ontario Government is devoting $241 million to partner with the federal government to supply more than $900 million in immediate aid. This small business relief program is for both small businesses and their landlords via a brand-new program, the Ontario-Canada Emergency Commercial Rent Assistance Program (OCECRA).

The OCECRA will offer forgivable loans to qualified commercial property owners experiencing potential rental income deficiencies since their local business lessees have been greatly affected by the COVID-19 crisis.

The program has been created to share the cost of small businesses with property owners. Local business occupants, as well as landlords, will each be asked to pay 25 percent of the previous rent cost, before profit. The provincial and federal governments will share the remaining 50 percent.

For example, say the monthly rent payment under a commercial lease for a local business is $10,000. In this instance, presume the property owner doesn’t make a profit (How this will be determined/monitored/enforced right now is anyone’s guess). The landlord gives up $2,500 (25% of rent). The small company would be accountable for paying $2,500 (25% of the rent). The government would cover $5,000. The federal/provincial split will be $3,750 from the federal government (37.5%) and $1,250 (12.5%) from the provincial government.

To obtain the funding, commercial property owners will need to reduce the rental expenses of small company tenants for April through June 2020 by a minimum of 75%. The funding is also contingent on the finalizing of an agreement or letter for rent reduction between the impacted tenant and the landlord. In addition to confirming the rent abatement for the 3 month period, it would also include a halt on distraint or termination for three months.

“You don’t build a business, you build people, then people build the business.”
-Zig Ziglar

How to apply for OCECRA

The OCECRA will be administered by the Canada Mortgage and Housing Corporation (CMHC). Applications can be filed up until September 30, 2020. Support would be retroactive to April 1, covering April, May and June 2020.

“Bringing great people onto your team is about demonstrating that size really doesn’t matter – people do.”
-Jess Campbell

Are there any restrictions on the CERC/OCECRA?

The OCECRA small business relief program would apply to commercial properties with small business occupants. Commercial with a residential component, and mixed-use residential and commercial properties with at least 30% of the space being commercial, qualify as it relates to the commercial rental only.

The property owner must be both the registered owner landlord of the property. If a property owner does not have a mortgage registered against the commercial rental building, the owner has to contact CMHC. Then there will be a discussion if the property owner/landlord has any other type of debt that would allow it to qualify under the program.

What are the qualification demands for small businesses?

“Make something people want” includes making a company that people want to work for.”
-Sahil Lavingia

Are there any qualifications the small business commercial tenant must meet?

A qualified small company lessee is one that:

Pays a regular monthly rental not more than $50,000 in gross lease payments; and
is a non-essential local business that has had to shut down or that is experiencing a 70% drop in pre-COVID-19 earnings (identified by comparing earnings in April, May or June to the very same month in 2019.

Not-for-profit organizations and charitable entities would also be taken into consideration for the program.

“A small business is an amazing way to serve and leave an impact on the world you live in.”
-Nicole Snow

Are any kind of small businesses omitted from the CERC/OCECRA program?

The following excludes any business from this small business relief program:

businesses owned by people holding political office;
companies that promote physical violence, incite hatred or discriminate; and
a company placed in their lender’s special accounts group prior to March 1, 2020.

The impact this small business relief program will have depends of course on all the fine print that has not yet come out. For it to be successful, landlords have to agree to the program. A commercial tenant cannot apply on its own.

“Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.”
-Jack Welch

Summary

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.

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.

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.

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.

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.

“Find a great mentor, someone who has already been through the many challenges of being an entrepreneur..”
-Jodi Levine

The Ira Smith Team is absolutely operational and both Ira, as well as Brandon Smith, are right here for a telephone appointment, conference calls and also virtual meetings.

Stay healthy and safe everybody.