Federal Budget 2021: Support for Businesses

May 01, 2021

On April 19, 2021, the Canadian government put forward the 2021 federal budget. This highly anticipated budget promised extension and introduction of subsidies and support programs for businesses. See below for some key budget highlights:

Extension of Canada Emergency Wage Subsidy and the Canada Emergency Rent Subsidy

The wage subsidy, the rent subsidy, and Lockdown Support is proposed to be extended until September 25, 2021. The rates for the wage subsidy and rent subsidy will however begin to phase out and decrease from July 4, 2021.

Extending application deadline for the Canada Emergency Business Account

The application deadline for the Canada Emergency Business Account (CEBA) which is an interest-free and partially forgivable loan of up to $60,000 will be extended till June 30, 2021.

Canada Recovery Hiring Program

In order to aid recovery and help promote hiring of workers, the new Canada Recovery Hiring Program will act as a subsidy to offset a portion of the extra costs employers take on as they reopen, either by increasing wages or hours worked, or hiring more staff. The program will be available between June 6, and November 20, 2021.

Technology adoption support for Small and Medium-sized Businesses

The $1.4 billion, Canada Digital Adoption Program, aims to help small- and medium-sized businesses adopt new digital technologies over the next four years through access to skills, training, and advisory services, and microgrants to support costs associated with technology adoption.

Enhancing the Canada Small Business Financing Program

  • – The budget proposes changes to the Canada Small Business Financing Program including:
  • – Increasing annual financing for the program by $560 million
  • – Expansion of loan eligibility to include intellectual property and start-up assets and expenses.
  • – Increasing the maximum loan amount from $350,000 to $500,000 and extending the loan coverage period from 10 to 15 years for equipment and leasehold improvements.
  • – Introduction of a new line of credit product to help with liquidity and cover short-term working capital needs for small business.