Ontario Small Business Support Grant – Application Details

As previously announced, eligible businesses can receive between $10,000 and $20,000 under this program, with broader flexibility left to business owners on how to best use funding in support of business operations.

To receive the grant, a business must:

  • Be required to close or significantly restrict services due to the provincewide shutdown effective 12:01 a.m. on December 26, 2020
  • Experienced revenue decline of at least 20 per cent, and
  • Had 99 employees or less at the enterprise level

Eligible business types

The Province has specifically identified eligible businesses that can apply under the program. It is important to note that ONLY those appearing on this list are eligible to receive funding under the grant as of the time of writing of this article and based on the application guide.

The list is as follows:

  • Before- and after- school programs
  • Campgrounds
  • Cannabis retail stores
  • Cell phone and computer providers & repairs
  • Community centres and multi-purpose facilities
  • Conference centres and convention centres
  • Day camps for children
  • Domestic services
  • Drive-in cinemas
  • Driving instruction
  • Facilities for indoor sports and recreational fitness activities (including fitness centres and gyms)
  • Garden centres
  • Hardware stores (including Big Box stores) required to close for in-person shopping
  • In person teaching and instruction
  • Media industries including film and television production (excluding radio/television broadcasting)
  • Meeting or event space
  • Museums, galleries, aquariums, zoos, science centres, landmarks, historic sites, botanical gardens and similar attraction
  • Outdoor markets (excluding grocery)
  • Outdoor sports and recreation facilities
  • Performing arts and cinemas
  • Personal care services relating to the hair or body (excluding oxygen bars)
  • Personal services
  • Pet/animal food and services
  • Photography services
  • Racing venues, casinos, bingo halls and gaming establishments
  • Rental and leasing services (including automobile, commercial and light industrial machinery and equipment rental)
  • Restaurants and bars
  • Retail required to close for in-person shopping
  • Safety, medical and assistive devices retail (excluding pharmacies)
  • Shopping malls
  • Ski hills
  • Tour and guide services
  • Vehicle and equipment repair services
  • Veterinary services

Ineligible businesses

Ineligible businesses includes those that were already required to be closed prior to the introduction of modified Stage 2 public health measures on October 10, 2020 as well as essential businesses permitted to operate with capacity restriction. As the list of eligible businesses is very clearly defined, the distinction between eligible and in-eligible businesses should be relatively straight-forward.

Understanding the eligible enterprise

Under the program rules, an eligible enterprise can be a corporation, an unincorporated business, partnership, charity, NPO or any other type of entity operating a business in Ontario.

The grant will only be paid once to an affiliated group, that otherwise is considered eligible. Affiliation is defined under the guide. An enterprise is considered affiliated with another enterprise if:

  • One of the enterprises controls the other enterprise directly or indirectly in any manner whatsoever.
  • Each enterprise is controlled directly or indirectly in any manner whatsoever by the same enterprise, individual, or group of individuals or enterprises.

Assuming there are no affiliated entities, and there were fewer than 100 employees, it may apply for the grant pending the meeting of other requirements. If there are affiliated entities, the affiliated group will also be required to have less than 100 employees. If more than 100 employees, than the grant is not available.

Calculating revenue loss

Eligible businesses must demonstrate they experienced a revenue decline of at least 20 percent when comparing monthly revenues. The province has underscored that monthly revenues must be used, but has indicated that it has pre-identified some special provisions for winter seasonal businesses, such as ski-hills which will be adjusted for in the application portal.

The application portal will calculate revenue loss using revenue reported by applicants.

Period baselines are a comparison of April 2020 revenue to April 2019 revenue, expressed in percentage terms. Businesses that were not in operation in April 2019 will have alternative decline calculation options available for them when live within the application portal.

When applying as the applicant within an affiliated group, the affiliated group aggregate revenue must be considered; however, only the applicant will be in receipt of the grant. There is only one grant available for an affiliated group.

What is revenue?

Revenue under the program is considered to be:

  • Revenues attributable to Ontario operations
  • Revenues from ordinary activities earned from arm’s length sources using normal accounting practices (note that there is no optionality, such as cash vs. accrual seen in other programs)

Revenue excludes:

  • Extraordinary items
  • Capital items

Determining employee levels

Employee counts are based on the total number of employees across all affiliated entities. This includes full-time, part-time and seasonal workers, using available supporting payroll data. This should normally include T4 data, but for businesses that may have commenced in 2020 and have yet to file T4s. In this case, it would appear to internal payroll records could be used in these cases.

The count will be based on employee data as of the first month used in the revenue decline calculation – for example, April 2019 for most businesses.

Application requirements

Applications are due no later than March 31, 2021 which is a much shorter runway than other high-profile government programming.

When applying for the Grant, businesses must provide and attest to the following information:

  • Legal business name
  • CRA business number (note that it appears as though an otherwise eligible business that does not yet have a business number does have the option of applying for one now and still being considered “eligible”)
  • Business type (see section below for business types that have been defined by the Province)
  • Revenue figures to support the calculation of revenue decline
  • Number of employees
  • Banking information

It is also worth noting that certain terms and conditions will be attached to the funding at the time of application and there will be significant repercussions to any individual or entity improperly in receipt of funds under the program. When applying for the program you must ensure that you can appropriately sign off on program terms and conditions at the time of application.

Other considerations

Note that applications and grants are subject to audit by the Government of Ontario. In addition, the Government has indicated that grant recipients are subject to release under freedom of information rules. The province has indicated a service standard of approximately 10 business days to receive payment.

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