The Canada Emergency Business Account (CEBA) is an interest-free loan program from the Canadian government offered as a response to the COVID-19 pandemic. The CEBA program has approved over 800,000+ businesses for funding, resulting in a total of $31B+ in government loans through this program.
Unfortunately, for many businesses, this was not enough to protect them from the economic impacts of COVID-19, resulting in the federal government raising the maximum loan size from $40K to $60K.
Canadian businesses who received a $40,000 loan through CEBA can apply to receive a $20K addition to the loan.
Businesses that have paid back their $40K loan may still apply for the additional $20K loan. All businesses applying for the top-up must apply for the full $20K. Businesses that have not yet applied for CEBA now have until March 31, 2021 to submit an application.
Program Overview: Canada Emergency Business Account (CEBA)
Amount of Funding:
Canadian businesses and not-for-profits can receive interest-free loans of up to $60,000 with up to 33% being forgivable (maximum of $20,000 in total) if paid on or before December 31, 2022.
If you have not applied for the CEBA loan, you can speak with your local financial institution to get started or use the Canada.ca pre-screening tool to find out if you’re eligible to apply.
Businesses who have already received funding through CEBA can apply for the additional $20K by visiting the financial institution they originally applied with.
Who Can Apply:
Applicants with a $40,000 CEBA loan may apply for the $20,000 expansion. If you have not yet applied for a CEBA loan, your business must meet the following criteria in order to apply:
- Attest that your business is facing financial hardship as a direct result of the COVID-19 pandemic (such as a drop in revenue, increase in expenses, etc.);
- Have an active CRA Business Number (BN) on or prior to March 1, 2020;
- Have an active business chequing/operating account with your CEBA lender at the time of application;
- Have not previously used funding through CEBA and will not apply for CEBA through a separate financial institution; and
- Intend to continue to operate your business or to resume operations.
Eligible expenses to be covered under CEBA are considered “non-deferrable expenses” that were not incurred or agreed upon before March 2020 and cannot be deferred beyond 2020.
Eligible Non-Deferrable Expenses include:
- Employee wages and other employment expenses provided they are not arms length employees;
- Rent/lease payments for real estate and capital equipment used for business purposes;
- Payments incurred for insurance costs or property taxes;
- Utility payments for business purchases such as telephones, 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 Borrower;
- Payments incurred for materials consumed to produce a product ordinarily offered for sale by the Borrower; and
- Any other expense in a category other than the above as may be indicated by GOC under the Web Page from time to time as being an Eligible Non-Deferrable Expense for the purpose of the Program.
Deadline to Apply for Canada Emergency Business Account (CEBA)
You must apply for the $20K increase through the financial institution that provided you with your original $40K CEBA loan. For businesses that have not yet applied for a CEBA loan, you can start your application online with the Canada.ca pre-screening tool.
Find the latest information on coronavirus-related funding programs offered by the Canadian government by visiting the COVID-19 business support page for the latest updates on programs, webinars, infographics, and tips for working remotely.