CEBA LOAN REPAYMENT (DEADLINES AND EXTENSIONS)

The Canada Emergency Business Account (CEBA) program originally provided interest-free loans of up to $60,000 to support small businesses and not-for-profits during the challenges posed by the COVID-19 pandemic.

CEBA offered interest-free loans, with a maximum amount of $60,000, to assist small businesses in covering operational expenses (such as rent, utilities, and insurance) during periods of reduced revenue.

For eligible CEBA loan holders in good standing, repayment by January 18, 2024, results in potential loan forgiveness of up to 33 percent, equivalent to a maximum of $20,000 (comprising 25% of the original $40,000 loan and 50% of the $20,000 loan expansion).

Originally set for December 31, 2022, the repayment deadline has been extended to January 18, 2024. This deadline is further extended to March 28, 2024, for businesses applying for refinancing to settle the non-forgivable portion.

Failure to pay the non-forgivable portion by the deadline results in the loss of loan forgiveness amounts up to $20,000. The remaining outstanding balance then converts to a 3-year term loan with a 5% interest rate. The new deadline for full repayment of the loan, up to $60,000, is now December 31, 2026.

To qualify for loan forgiveness of up to $20,000, kindly settle the outstanding loan balance (excluding the forgiveness amount) before the extended deadline. If refinancing is desired, please contact the original CEBA lender promptly.

(Note: This information is intended for personal educational purposes only. For specific advice tailored to your situation, consult your tax advisor.)