Impact of Bill C-2 on public company CEWS claims: Effective date

As noted previously in our December 21, 2021 news item, Bill C-2 (An Act to provide further support in response to COVID-19) contained a change that may restrict Canada Emergency Wage Subsidy (CEWS) claims made by a publicly traded company or a subsidiary of such a company that paid dividends to an individual who held common shares. One area of confusion was on the effective date of the change.

On April 11, the CRA updated a COVID-19 wage and hiring support for businesses page with the following statement which provides more clarity:

“Publicly traded companies and taxable dividends: For claim period 23 and onward, if you are a publicly traded company or a subsidiary of such a company, you are not entitled to any wage subsidy for that claim period in which you paid taxable dividends to an individual who is a holder of common shares of the company or of the subsidiary of the company.”

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