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Canada Emergency Business Account Loan

Last updated: Oct. 8, 2021 

The Canada Emergency Business Account provides interest-free loans of up to $60,000 to small businesses and non-profits.

  • NEW: The deadline for completing the CEBA application at your primary financial institution has been extended to June 30, 2021. 
  • All CEBA applicants can now check the status of their CEBA Loan online. The government advises waiting 5 to 7 business days after finalizing your application before checking your loan status online.  
  • As of Dec. 4, 2020, CEBA loans for eligible businesses increased from $40,000 to $60,000. If you’ve already applied for CEBA, you may apply for the $20,000 expansion.
  • So that’s $60,000 (total) of which $20,000 ends up forgivable if repaid by December 31, 2022.
  • The forgivable portion of the loan is taxable in the year the loan was taken. 
  • As of Oct. 26, 2020, the government expanded eligibility for CEBA by the removing the previous condition for having an active business chequing/operating account before you apply for the loan.

The loan can be used to cover operating costs such as payroll, rent, utilities, insurance, property tax and regularly scheduled debt service.

The loan can’t be used for payments or expenses such as the repayment/refinancing of existing debt, payments of dividends, distributions and increases in management compensation.

The loan is interest-free. There is no cost to the borrower, plus there is a direct benefit (up to $20,000) by meeting the repayment deadline.

To apply, speak with your lender or financial institution.

How do I qualify for CEBA?

Your business will need to meet the following requirements:

  • Be a Canadian operating business as of March 1, 2020
  • Have a federal tax registration
  • Demonstrate you had payroll expenses between $20,000 to $1.5 million in the 2019 calendar year
  • Apply through your primary financial institution and have an active business chequing/operating account with them
    • NOTE: If you are currently operating your business with a personal account, you must first open a business account with your financial institution before you apply for the loan. Check with your financial institution for their terms and conditions.
  • Have not applied for the loan through any other financial institution
  • Acknowledge your intentions to continue to operate your business or resume operations
  • Agree to participate in post-funding surveys conducted by the Government of Canada or any of its agents

New expanded criteria for businesses

As of June 26, 2020 the government also expanded the program to include a greater number of businesses that are sole proprietors receiving income directly from their businesses, businesses that rely on contractors, and family-owned corporations that pay employees through dividends rather than payroll.

To qualify under the expanded eligibility criteria, applicants with payroll lower than $20,000 would need:

  • A business operating account at a participating financial institution
  • A Canada Revenue Agency business number
  • To have filed a 2018 or 2019 tax return
  • To have eligible non-deferrable expenses in 2020 between $40,000 and $1.5 million

What are eligible non-deferrable expenses?

The eligible non-deferrable expense categories are 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 Borrower
  • Payments incurred for materials consumed to produce a product ordinarily offered for sale by the Borrower

How do I apply for CEBA?

Each bank is requesting the following information when you apply:

Applying using the Payroll Stream:

  • Your employer account number, as reported at the top of your 2019 T4 Summary of Remuneration Paid (T4SUM)
  • Your employment income reported in Box 14 of your 2019 T4SUM
  • Your 2019 T4SUM if requested in an audit

Applying using the Expenses Stream is a two-step process.  Once you have initiated the application through your financial institution, you will be directed to the CEBA site and be required to supply the following:

  • The name of the financial institution where you submitted your application; and
  • Your 9-digit business number (same number you used in your application with your financial institution); and
  • Electronic or paper copies of Receipts / Invoices / Agreements to be uploaded as evidence of your 2020 Eligible Non-Deferrable Expenses

Download our Canada Emergency Business Account Loan Checklist for a list of what you’ll need to apply and a summary of eligibility requirements (PDF).

FBC Members: Do you need help with your applications?

With our REBOOT program, our team will make sure your application forms are completed accurately, optimized for maximum benefit, properly documented, submitted quickly, and protected by FBC Audit Representation in case the CRA has questions.

So far we’ve helped our Members apply for and receive more than $4.2 Million from federal COVID-19 financial support programs.

FBC Member Registration click here

Contact FBC

Have questions about this or other COVID-19 programs for Canadian businesses? Unlimited consultation related to tax matters is a key benefit of FBC Membership. We’re offering a free consult where we get to know your business and determine next steps on saving you time and money. Click here to request a consultation online.


Disclaimer: The material above is provided for educational and informational purposes only.