*The NOW is running regular items by the Burnaby Board of Trade about how businesses can survive COVID-19.
The first question the Burnaby Board of Trade has heard many businesses ask in light of the COVID-19 downturn is: how do I pay my employees?
With sales and revenues being severely reduced, many local businesses are wondering how they can avoid or minimize layoffs and keep as many staff as possible.
One solution that has been announced by the federal government is a 10% wage subsidy to help businesses cover staff wages.
While the Burnaby Board of Trade thinks this subsidy needs to be increased significantly to stem job losses, this is a good first step, and here is how it works.
The wage subsidy is available, right now, to non-profits, registered charities, and private small business corporations. The small businesses must be owned/controlled by Canadians, must pay wages to an employee (besides the business owner), and must be eligible for the federal small business deduction. With this criteria, the vast majority of small businesses will be eligible.
Thesubsidy will equal 10% of wages paid between March 18, 2020 and June 20, 2020, and will have a cap of $1,375 per employee and $25,000 in total per employer.
How to Calculate and How to Get the Subsidy
The subsidy is provided to businesses by reducing the amount of tax remittances they submit to the government.
Businesses will calculate the subsidy manually by multiplying their wages/payroll by 0.10 for any given period. They then reduce the income tax remittance they owe the Canada Revenue Agency by that amount and instead keep that amount for themselves.
If the subsidy ends up being more than the tax remittances during this time, businesses can deduct the balance from future remittances, even if after the June 20 end to the program.
Information on the 10% Wage Subsidy and other government programs is available online at the Burnaby Board of Trade’s COVID-19 Updates page: bit.ly/BBOTCOVID.
The Burnaby Board of Trade is Burnaby’s chamber of commerce, and is a catalyst for economic growth, the convener of business and community leaders, and a champion for the interests of local businesses.