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The Canada Emergency Business Account (CEBA) is an initiative of the Government of Canada.  The official Government website is

A Guide to the CEBA Loan Requirements

CEBA Loan Requirements
Reading Time: 9 minutes

Small businesses that have been impacted by the COVID-19 pandemic may benefit from applying for the Canada Emergency Business Account (CEBA) loan program. This guide provides all of the information you need to know about CEBA loan requirements, such as eligibility criteria and the application process. To details on CEBA’s loan forgiveness options. Don’t miss out – use your small business emergency account so you can make the best use of this valuable resource available!

Short Summary

  • The Canada Emergency Business Account (CEBA) is an interest-free loan program with a maximum of $60,000 to help Canadian businesses impacted by COVID-19.
  • Eligibility for the CEBA loan depends on income levels and the preparation of necessary documentation, including the 2019 T4 summary.
  • Loan forgiveness up to 33% is available if repaid by December 31, 2023. As of January 1, 2094 a 5% annual interest rate applies after the interest-free period ends and the full amount of the CEBA loan is due by December 31, 2023.

Overview of the Canada Emergency Business Account (CEBA)

Canadian businesses affected by COVID-19 are eligible for the Canada Emergency Business Account (CEBA), a financial relief measure that offers interest-free loans with portions that can be forgiven. With an increased maximum amount of $60,000 and an initial loan of $40,000 as part of CEBA expansion, this program helps companies to manage their expenses during these difficult times. The application deadline was June 30, 2021. Those needing assistance can contact the CEBA call center for help.

CEBA Program Timeline

The Canadian Emergency Business Account (CEBA) Program was initiated on April 9, 2020, and was tailored several times to adapt to the ever-changing needs of small businesses within Canada during this pandemic. A great highlight was introducing the Non-Deferred Expenses Stream, allowing more Canadian companies access to interest-free financing options.

Terms for repayment time frames and the period when the CEBA loan is still deemed interest-free, changed from December 31, 2022, to December 31, 2023. After December 31, 2023, monthly interest payments must be submitted, and the loan amount must be repaid by December 31, 2025.

CEBA Loan Requirements: Eligibility Criteria


To be eligible for the CEBA loan, businesses must meet specific criteria based on their annual payroll and Non-Deferrable Expenses. The CEBA eligibility criteria have been designed to make sure that the program is accessible to a wide range of companies affected by Covid-19. To fit the requirement set out in the criteria for eligibility, one’s organization’s income levels are considered when applying for this financial aid opportunity.

Payroll Stream Requirements

The Payroll Stream was created to aid small businesses that rely heavily on the employment expenses they incurred between $20,000 and $1.5 million in 2019. Its launch date of April 9, 2020, offered these establishments an opportunity to access this support during uncertain times. This stream has been tailored towards those with considerable payroll costs so their workforce will remain supported despite challenging circumstances.

Non-Deferrable Expenses Stream Requirements

The Non-Deferrable Expenses Stream is specifically tailored for businesses that have an eligible non-deferrable expense budget of between $40,000 and $1.5 million in 2019 yet may not fulfill the payroll criteria. This stream was created to provide financial assistance to a wider range of companies that are affected by the COVID-19 crisis.

Eligible businesses can submit their application through their primary financial institution for a CEBA loan starting June 26th, 2020, under this unique stream to afford any critical expenses related to the pandemic.

Application Process for CEBA Loans




In order to be approved for a CEBA loan, businesses need to make sure they are well-prepared with the necessary documentation, such as their 2019 T4 summary. Businesses should also work closely with their primary financial institution when submitting an application. This can help simplify and expedite the process. It is crucial that individuals understand that it could take some time from submission of paperwork until approval, so being organized ahead of time will ensure all goes smoothly.

Preparing Necessary Documentation

Before applying for the CEBA loan, it is important to ensure you have all the required documents ready. This includes a T4 summary from 2019 or evidence that proves non-deferrable expenses and your income tax return form. Having these materials organized beforehand will speed up the process significantly while avoiding any mistakes along the way.

After collecting the necessary documents, such as proof of non-deferred costs and the Income Tax Return Form, individuals are ready to apply for special financial assistance for businesses facing challenges. Accurate documentation is essential as it ensures efficient processing and increases the chances of successful approval.

Working with Your Primary Financial Institution

Having a primary financial institution and managing your personal or business bank account is of the utmost importance to ensure you get through the CEBA loan application process smoothly. Participating financial institutions can be very helpful in this regard, as they assist with all aspects, such as navigating the required documents or making any corrections needed for successful submission.

With their expertise, businesses have greater chances of getting approved for relief funds from loans like these offered by Ceba programs; as part of engaging with them regarding this type of service, contact your preferred financial institution before anything else is necessary. Upon completing the application, the disbursement will be processed if the application is approved and conditions are met.

Understanding CEBA Loan Forgiveness and Repayment


Understanding the specifics of CEBA loan forgiveness and repayment is a significant part of your business’s financial planning. The amount which can be forgiven depends on how much money was borrowed and paying it back according to stipulated deadlines. All loans are subject to different repayment terms when taking into consideration size. But some portion will always be eligible for debt cancellation if paid in full by an allotted time period.

Loan Forgiveness Calculation

CEBA loans have a great loan forgiveness benefit, offering 25% of the amount for $40,000 loans and up to 33% when borrowing $60,000. Businesses can plan their finances accordingly and capitalize on these perks by repaying any outstanding balance before December 31, 2023, in order to get maximum relief from this forgiving program. If they fulfill that criterion, then the total forgiven portion will be taken away from what needs paying back, making it less financially burdensome for them.

Repayment Deadlines and Interest-Free Periods

Businesses have until December 31, 2023, for their CEBA loan repayment. Repaying before this deadline will be interest-free. Thereafter, a 5% annual rate on any balance is due every month’s end. Knowing when repayments are needed helps businesses arrange funds to pay off their CEBA loan in time without accumulating more interest charges.

Ineligible Businesses and Common Pitfalls


The CEBA program seeks to help a wide range of companies, yet certain firms do not qualify for their loans – particularly those with non-business banking accounts. To give yourself the best chance at successful application approval, applicants should be aware of common pitfalls that could arise during the process. For instance, when the CEBA loan program was announced, eligible companies needed to have a business bank account. However, on October 26, 2021, this requirement was removed so that companies operating from personal bank accounts could also apply for a CEBA loan.

Ineligible Business Types

It’s important to ascertain the eligibility status of your business in regard to CEBA loans before devoting time and energy to completing the application process. Government bodies, unions, and religious institutions are some entities excluded from this program. By being aware of such restrictions, you can easily decide if your firm would make a suitable recipient of these financial resources. Investing effort without certainty could result in potential disappointment or wasted efforts due to an ineligible organization type, so one should familiarize oneself with what companies qualify for beforehand.

Avoiding Application Mistakes

To give yourself the best chance of having your CEBA loan application approved, you must be aware of potential hangups and how to avoid them. This includes ensuring all financial paperwork is correct, meeting specific criteria for eligibility, and working closely with a major bank or other primary financial institution.

Double-checking that everything related to finances is accurate, along with records that show the use of funds from the loaned amount as well as devising an appropriate plan for repayment when necessary, can help prevent common errors during submission time, thus helping improve chances of receiving much-needed assistance through financing options available.


It is important for businesses affected by COVID-19 to be aware of the eligibility criteria, application process, and loan forgiveness options available with the CEBA loan program. With an understanding of this valuable financial lifeline, those eligible can take advantage of it to navigate these difficult times. Don’t miss out on its crucial assistance!

Frequently Asked Questions

Am I personally liable for the CEBA loan?

If your company is a corporation, you won’t have to take on responsibility for the CEBA loan. If it’s either an individual proprietorship or partnership, then repayment of the funds will be your obligation.

Should payments become unaffordable due to financial difficulty and bankruptcy become necessary as an option – whether personal or through consumer proposal – repaying the CEBA loan will be part of the liabilities.

Is the forgivable portion considered income for tax purposes?

The CEBA loan forgiveness amount is taxable income in the year of receipt. To claim up to 33 percent (a maximum of $20,000) forgiveness, the loan must be repaid by December 31st 2023.

What is the maximum CEBA loan?

CEBA loans can be a maximum of $60,000 with the potential for up to one-third (or $20,000) being forgiven.

What is the maximum amount of loan forgiveness available under CEBA?

For loans of $40,000 and below, CEBA allows up to 25% forgiveness when repaid by the given deadline. For those with a higher loan amount of $60,000, there is an increased potential for 50% of the expansion loan ($20,000), which can offer businesses as much as $20k in relief. In both scenarios, this means that borrowers may qualify for tens of thousands of dollars worth of debt forgiveness if they act quickly on their repayment plans.

What are the repayment deadlines for CEBA loans?

CEBA loans must be repaid by the end of 2023 to qualify for government forgiveness. If not repaid by this date, the loan does not qualify for government forgiveness and the loan is payable in full, plus interest by December 31, 2025.

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