The federal government is increasing the size of its small business interest-free loan program by 50% to help them weather the pandemic, with half of the top-up being repayable if the loan is repaid by the end of 2022.
The new loans were announced in Monday’s economic update and come on top of other sectoral support for the hardest hit industries.
The Canada Emergency Business Account has provided loans of $ 40,000 to more than 790,000 nonprofits and small businesses, ranging from dental offices to delicatessens. The additional loan of $ 20,000, provided through financial institutions and Export Development Canada, will be rolled out in December and can be requested until March 31.
“Small businesses have been hit hard and have worked hard to stay afloat – during wave one and now wave two,” the government said in its 237-page economic update on Monday.
“These improvements demonstrate the government’s commitment to supporting small businesses to ensure they can continue to support families and communities across the country.
Up to $ 10,000 of each loan tranche is repayable if the loan is repaid by the end of 2022.
Small businesses have been particularly affected by restrictions imposed by the government to help control the spread of the virus that causes COVID-19.
The government has also announced targeted regional support for businesses and additional funding for innovative businesses to ensure that “companies rich in intellectual property have the support they need to meet the challenges presented by COVID-19” .
To this end, the Liberal government has also proposed adding $ 250 million over five years, starting next year, to the Strategic Innovation Fund, which supports “large-scale transformative” projects.
The additional funds “will help Canada’s most innovative businesses and industries overcome the pandemic and become world leaders who will help spur growth and create jobs in the Canadian economy,” the government said Monday.
These improvements demonstrate the government’s commitment to supporting small businesses to ensure they can continue to support families and communities across the country.
In the meantime, a top-up of up to $ 500 million is earmarked for regional development agencies and the Community Futures Network of Canada, bringing total funding to over $ 2 billion in this fund. The government is also proposing to provide up to $ 3 million to the Canadian Northern Economic Development Agency for fundamental economic development projects that will support small businesses in Canada’s territories.
On a much smaller scale, the Economic Update recognized that many Canadians are working from home during the pandemic and committed to making it easier to claim home office deductions.
Workers “are turning their bedrooms, basements and kitchens into offices, and incurring increased household expenses to do their jobs,” the document said, adding that many may not know the rules for making such claims or wish to take responsibility. administrative burden. .
To simplify the process for taxpayers and businesses, the Canada Revenue Agency will allow employees working from home due to the pandemic to claim up to $ 400, based on home working time, without the need for track detailed expenses.
The government added that it “will generally not ask people to provide a signed form to their employers.”
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