FAQ Archive — Eligibility (Closed)

Who was eligible for the January 18, 2024, repayment deadline to qualify for partial loan forgiveness?

Loan Holders that met CEBA eligibility criteria and remained in good standing were eligible for the January 18, 2024, repayment deadline to qualify for partial loan forgiveness. Loan Holders were contacted by their financial institution to confirm their eligibility for the January 18, 2024, repayment deadline to qualify for partial loan forgiveness.

CEBA eligibility criteria validations have been completed for all Loan Holders and the results of these validations are final. These validations were conducted in partnership with the Canada Revenue Agency (CRA) and revalidated periodically since the launch of CEBA in April 2020 to ensure an accurate reflection of the information in CRA records.

What were the eligibility requirements for CEBA?

The CEBA application process followed one of two streams: (i) the Payroll Stream (applicants with employment income paid in the 2019 calendar year between Cdn.$20,000 and Cdn.$1,500,000) or (ii) the Non-Deferrable Expense Stream (applicants with Cdn.$20,000 or less in total employment income paid in the 2019 calendar year).

At the time of application, every applicant was required to meet the following criteria:

• Have an active CRA Business Number (BN) with an effective date of registration on or prior to March 1, 2020.

• Have an active business chequing/operating account with a participating financial institution at the time of applying for CEBA. Note: If applicant did not have an active business chequing/operating account at the time of application, the applicant was required to open one at a participating financial institution before applying for CEBA.

• Have not previously used the Canada Emergency Business Account Program (the “Program”) and agree to not apply for support under the Program at any other financial institution.

• Intended to continue to operate its business or to resume operations.

If you applied within the Non-Deferrable Expenses Stream, you were also required to meet the following criteria:

• Have eligible non-deferrable expenses between Cdn. $40,000 and Cdn. $1,500,000. Eligible non-deferrable expenses could have included costs such as rent, property taxes, utilities, and insurance. Expenses are subject to verification and audit by the Government of Canada.

• Filed an income tax return with the CRA with a tax year ending in 2019 or, if its tax return for 2019 was not yet submitted, 2018.

What were Eligible Non-Deferrable Expenses and what were the Eligible Non-Deferrable Expense categories?

Applicants with $20,000 or less in payroll in 2019 were required to demonstrate having Eligible Non-Deferrable Expenses between Cdn. $40,000 and Cdn. $1,500,000 in 2020. Expenses were considered “Eligible Non-Deferrable Expenses” if they were already incurred in January and/or February 2020, or were due to a legal or contractual obligation as at March 1, 2020 and could not have been avoided or deferred beyond 2020 even during a period of shut down and depressed revenues as a result of COVID. Electronic or paper copies of Receipts / Invoices / Agreements were required to be uploaded as evidence of your 2020 Eligible Non-Deferrable Expenses.

CEBA was not intended to provide income support, or support for variable operating expenses to businesses. CEBA was intended to support businesses by providing financing for their expenses that could not have been avoided or deferred as they take steps to safely navigate a period of shutdown, thereby helping to position businesses for successful relaunch when the economy reopened.

The Eligible Non-Deferrable Expense categories were the following:

• Wages and other employment expenses to independent (arm’s length) third parties;
• Rent or lease payments for real estate used for business purposes;
• Rent or lease payments for capital equipment used for business purposes;
• Payments incurred for insurance related costs;
• Payments incurred for property taxes;
• Payments incurred for business purposes for telephone and utilities in the form of gas, oil, electricity, water and internet;
• Payments for regularly scheduled debt service;
• Payments incurred under agreements with independent contractors and fees required in order to maintain licenses, authorizations or permissions necessary to conduct business by the applicant;
• Payments incurred for materials consumed to produce a product ordinarily offered for sale by the applicant.

What if I ran more than one business?

Each qualifying business must have had a unique 9-digit Canada Revenue Agency (CRA) Business Number at the time of application. Each qualifying business was limited to one CEBA Loan.

Was a Canada Revenue Agency (CRA) Business Number required to apply?

Yes. A 9-digit CRA Business Number was required to apply. The business number was required to be active with an effective date on or prior to March 1, 2020. For Payroll Stream applicants, the 15-digit payroll account was required to be active with an effective date on or prior to March 1, 2020.

If the first fiscal year (and tax year-end, as indicated on the business’ tax return) of a business ended on or after January 1, 2020, was that business eligible for a CEBA Loan?

CEBA applicants were required to attest to the fact that they had filed an income tax return with the Canada Revenue Agency for 2019 (i.e., the tax year-end, as indicated on the tax return, is in the calendar year 2019) (or if this income tax return for 2019 was not yet submitted, 2018). If a CEBA applicant’s first tax year-end, as indicated on the tax return, was in calendar 2020, they therefore were not eligible for a CEBA Loan.

Were registered charities and not-for-profit organizations eligible for CEBA?

Since the launch of CEBA, the Government of Canada made numerous changes to the program to make it available to more Canadian businesses that continued to need support during the COVID-19 pandemic.

In order to qualify for the CEBA Program, applicants were required to be an active operating business with a CRA Business Number both effective as of March 1, 2020, in the form of a sole proprietorship, partnership or a Canadian-controlled private corporation (“CCPC”). Additionally, for the Non-Deferrable Expense stream, applicants were required to have filed a valid T1 or T2 tax return. Charities and not-for-profit organizations that met the program’s requirements have successfully attained CEBA funding.

CEBA eligibility was determined based on the criteria established by the Government of Canada. No organization involved in administering the CEBA Program has the authority to grant exceptions, including your financial institution.

Who could apply for the $20,000 expansion?

Loan Holders who received a $40,000 loan were able to apply for the $20,000 CEBA expansion until June 30, 2021.

What types of legal entities were eligible applicants for a $60,000 CEBA Loan or $20,000 CEBA expansion loan?

In order to be eligible for a $60,000 CEBA Loan or $20,000 CEBA expansion loan, an applicant was required to be an active operating business that was a sole proprietorship, partnership or a Canadian-controlled private corporation (“CCPC”) that was in operation in Canada on March 1, 2020, and meet all of the CEBA eligibility criteria. Other types of business entities were not eligible for a $60,000 CEBA Loan or $20,000 CEBA expansion loan.

If my business has received support under the COVID Indigenous SMEs Initiative, was my business also eligible for CEBA?

The COVID Indigenous SMEs Initiative was part of the Government of Canada’s response to COVID-19 and was intended to support small to medium-sized Indigenous businesses. Businesses that received support under the COVID Indigenous SMEs Initiative were not eligible for a $60,000 CEBA Loan or $20,000 CEBA expansion.

If my business has received support under the Regional Relief and Recovery Fund (RRRF), was my business also eligible for CEBA?

The Regional Relief and Recovery Fund (RRRF) was part of the Government of Canada’s response to COVID-19 and was intended to support businesses that are not eligible for CEBA. Businesses that received support under the Regional Relief and Recovery Fund (RRRF) were not eligible for a $60,000 CEBA Loan or $20,000 CEBA expansion.