Jared Pilon
In a recent development, the Government of Canada has extended the deadlines for the Canada Emergency Business Account (CEBA) repayment and partial loan forgiveness. This extension comes as welcome news for many businesses, including those in Red Deer, Alberta, and clients of Legacy Accounting LLP LLP, but falls short of what many business owners were hoping for from the government.
Here are the key highlights of this update:
1. Partial Loan Forgiveness: The extension includes provisions for partial loan forgiveness. The repayment deadline for CEBA loans to qualify for partial loan forgiveness of up to 33 per cent is being extended from December 31, 2023, to January 18, 2024.
2. Refinancing application: For CEBA loan holders who make a refinancing application with the financial institution that provided their CEBA loan by January 18, 2024, the repayment deadline to qualify for partial loan forgiveness now includes a refinancing extension until March 28, 2024.
This will allow more small businesses and not-for-profits to access relief and give them more time to hear back from their financial institutions on refinancing applications.
3. Extended Repayment Deadline: As of January 19, 2024, outstanding loans, including those included in the refinancing extension, will convert to three-year terms loans, subject to 5% per annum. The term will be extended from December 31, 2025 to December 31, 2026.
4. Consultation with Financial Experts: Given these updates, it's crucial for businesses to consult with their lender to understand how these changes apply to their specific situations. Repayment on or before the new deadline of January 18, 2024 (or March 28, 2024 if a refinancing application is submitted prior to January 18, 2024 at the financial institution that provided their CEBA loan), will result in loan forgiveness of $10,000 for a $40,000 loan and $20,000 for a $60,000 loan.
Conclusion:
In conclusion, the extension of CEBA repayment and partial loan forgiveness deadlines provides minor relief to business owners in Red Deer, Alberta, and across Canada. However, it's essential for businesses to stay informed and seek professional advice to make the most of these opportunities.
Legacy Accounting LLP LLP remains committed to assisting businesses in Red Deer, Alberta, with their accounting, tax, and financial planning needs. For personalized guidance on how these CEBA updates affect your business, don't hesitate to reach out to our team of experts.
Stay tuned for more updates on financial matters that impact businesses and individuals alike, as Legacy Accounting LLP LLP continues to keep you informed.
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Posted: 9/20/23
