COVID-19 Tax Measures: CEBA Loan Deadline, Repayment, and Forgiveness 

The Canada Emergency Business Account (CEBA) was introduced to provide financial support to businesses during the COVID-19 pandemic. This loan offered up to $60,000 to help businesses cover their operating costs. It’s important to note that the final date to withdraw or transfer funds from the CEBA loan was set for January 20, 2022. 

Repayment and Forgiveness Details: 

• To be eligible for the maximum loan forgiveness of $20,000, the loan amount with your financial institution should have been $60,000 on or before January 20, 2022. This means the loan should have been drawn at any time between the account opening date and January 20, 2022. 
• The deadline for CEBA loan repayments to qualify for partial loan forgiveness has been extended from December 31, 2022, to December 31, 2023. 
• For maximum forgiveness of $20,000, 75% of the maximum loan balance must be repaid by December 31, 2023. The remaining 25% (up to $20,000) will be forgiven. 

Examples of CEBA Loan Repayment and Forgiveness: 

• Company A: If the maximum balance was $60,000 on or before January 20, 2022, and $40,000 (75%) is repaid on or before December 31, 2023, then $20,000 (25%) will be forgiven. 
• Company B: If the maximum balance was $25,000 on or before January 20, 2022, and $18,750 (75%) is repaid on or before December 31, 2023, then $6,250 (25%) will be forgiven. 
• Company C: If no funds were ever used, then there is no repayment or forgiveness. 

Interest Details: Starting from January 1, 2024, any outstanding balance of the CEBA loan will be converted into a 5-year term loan. No interest will be applied until January 1, 2024. From this date onwards, an interest rate of 5% per annum will be charged, payable monthly on the last day of each month. The entire balance, along with any unpaid interest, must be settled by December 31, 2025.