COVID-19, CRA & Revenu Québec, Tax News

Tax Deadlines & Benefits Changes: A Response to COVID-19 for Individuals & Small Business

Last updated April 3, 2020

Is the Tax Deadline Delayed for 2019 Tax Returns?

You might be wondering right now how COVID-19 is going to be affecting your taxes in terms of deadlines or deductions and credits.

Federal Tax Updates 

For individuals and self-employed individuals:

    • The filing deadline for individuals has been postponed to June 1, 2020; the deadline for self-employed individuals is not noted as changed, it is currently June 15, 2020.
    • The CRA is allowing all tax-payers to defer their payments of any income tax amounts, that become owing on or after March 18, 2020, and before September 2020, to September 1, 2020.
    • You are encouraged to file before this new deadline if you expect to receive a refund, or expect to receive benefits under the GST/HST credit or the Canada Child Benefit, so it does not delay filing of the return and determining your 2020-21 benefit.
  • For trusts:
    • With taxation year ending December 31, 2019, the filing is extended to May 1, 2020
  • For businesses:
    •  The CRA is allowing all businesses to defer their payments of any income tax amounts, that become owing on or after March 18, 2020, and before September 2020, to September 1, 2020.  This relief applies to tax balances due, as well as instalments, under Part I of the Income Tax Act; no penalties or interest will accumulate on these amounts during this period.
    • There will be no initiation of post assessment GST/HST or Income Tax audits for SME businesses, for the next four weeks.

Provincial Tax Updates

Revenu Québec has instituted changes to assist individuals and business during this filing season for their provincial taxes.

  • For individuals and self-employed individuals:
    • The filing deadline for individuals has been postponed to June 1, 2020; the deadline for self-employed individuals is not noted as changed, it is currently June 15, 2020.
    • Deadline for applying balances due for the 2019 taxation year income tax returns has been postponed to September 1, 2020.  This applies to both individuals and self-employed individuals.
    • Tax installment deadlines have been moved as well; the June 15, 2020 payment is now moved to September 1, 2020.
  • For businesses:
    • Tax installment deadlines and any taxes due as of today are suspended until September 1, 2020.

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What Benefits or Other Financial Support is there?

For Individuals:

Canada Emergency Response Benefit (CERB):  The newly created Canada Emergency Response Benefit (CERB), will provide a taxable benefit of $2,000 per month, for up to 4 months, to qualifying individuals; workers who lose their income as a result of the COVID-19 pandemic.  CERB is a combination of the previously announced Emergency Care Benefit and the Emergency Support Benefit.  For more details, see our blog on this new benefit and how to apply, starting April 6, 2020cra, click HERE.

One-Time Extra Benefit Payments: These one-time extra payments are a part of the GST/HST Tax Credit and the Canada Child Benefit.  For more details, see our blog on this new benefit, click HERE.

RRIF Withdrawal Reductions for Seniors: The minimum withdrawal amount from a RRIF (Registered Retirement Investment Fund), for 2020, will be reduced by 25% in recognition of recent declines in value and the volatile market.  For more information on this deferral, read our blog on this topic HERE.

Student Loan Repayment Moratorium: A six-month suspension of repayment of Canada Student Loans, has been placed effective March 30, 2020.  No payments are required during this time; interest will also not accrue during the moratorium.  For more information on this deferral, read our blog on this topic HERE.

For Businesses:

Canada Emergency Business Account:  The newly created Canada Emergency Business Account (CEBA), will provide capital to small businesses who need it to cover their operating costs, as a result of the COVID-19 pandemic.  This program will provide loans of up to $40,000 to small businesses and not-for-profits.  The loans will be interest-free for a period of one year, with the potential of up to $10,000 of loan forgiveness (25%), if the balance of the loan is repaid on or before December 31, 2022.  For more information on this new loan, and other financial support for SMEs, read our blog on this topic HERE.

GST/HST Remittance Deferral: GST/HST remittances are being deferred until June 30, 2020.  This applies for monthly, quarterly, and annual filers, depending upon their return or instalment dates.  For more information on this deferral, read our blog on this topic HERE.

Temporary Wage Subsidy: This is a 3-month subsidy on the payment of source remittances, for income taxes withheld from employees, to the CRA.  Originally at 10%, the federal government is considering an increase to 75%.  This subsidy is taxable income and will require accounting for it in your bookkeeping records.  For more information on this subsidy, read our blog on this topic HERE.

 

We are doing our best to stay up to date with the information we are receiving from the federal government regarding benefits and credits available to individuals and businesses.  Check back for more information frequently.

 

For more details on income support and other benefits as part of the Federal Government’s Economic Response Plan for COVID-19, click here.

See also our COVID-19: Tax Info Centre, from our TurboTax Support team, answering many FAQs on this topic and more.