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

Making the Most of CEBA (Canada Emergency Business Account) Loans

Make the most out of CEBA
Reading Time: 9 minutes

Navigating the financial challenges brought on by the COVID-19 pandemic is no easy task for businesses. With the Canada Emergency Business Account (CEBA) loans available, there is a glimmer of hope for those struggling. But how can you make the most of these loans, maximize loan forgiveness, and allocate the funds wisely?

In this blog post, we will unravel the answers to these questions and provide valuable insights to help you steer your business through these trying times.

Short Summary

  • The CEBA program offers interest-free loans of up to $60,000 and loan forgiveness of up to $20,000 for eligible businesses.
  • Businesses should prioritize non-deferrable expenses such as rent and property taxes when allocating funds from the loan.
  • Professional advice is available through the CEBA Call Centre or banking services on budgeting strategies and taking advantage of loan forgiveness programs before December 31, 2023.

Overview of CEBA Loans

Overview of CEBA

The CEBA program was established to provide financial relief to Canadian businesses affected by the pandemic. Offering interest-free loans of up to $60,000, CEBA loans aim to support small businesses and not-for-profits by covering operating expenses during these difficult times. The loan forgiveness feature makes CEBA loans even more attractive, as eligible businesses can have up to $20,000 forgiven if they repay the loan by December 31, 2023.

To better understand CEBA loans and how they can benefit your business, let’s dive deeper into the CEBA program and the available loan amounts.

CEBA Program

The Government of Canada launched the CEBA program as a financial relief measure to assist businesses negatively impacted by the COVID-19 pandemic. These interest-free loans have been a lifeline for hundreds of thousands of Canadian businesses, helping them manage operating expenses, payroll, and other costs during times of economic hardship.

The CEBA program closed its applications on June 30, 2021. Those who wished to apply had to do so before that date. As a business owner, it’s crucial to explore strategies like partial loan forgiveness and repayment plans to maximize the benefits of your CEBA loan.

Loan Amounts

There are two loan options available through the CEBA program: a $60,000 loan and a $40,000 loan. The $60,000 loan option provides an additional $20,000 of financing, but if the CEBA loan balance is not repaid by the end of 2023, it will be converted into a two-year term loan at 5% interest, requiring the business to pay the full amount without any forgivable portion.

On the other hand, the $40,000 loan option allows businesses to retain their original CEBA loan with the forgiveable portion if they repay it by the end of 2023. For more information on the CEBA terms and conditions, it’s best to contact the Government of Canada directly.

CEBA Eligibility Criteria

CEBA eligibility

Understanding the eligibility criteria for CEBA loans is crucial for businesses looking to benefit from the program. Eligibility requirements include:

  • Having eligible non-deferrable expenses between CAD 40,000 and 1,500,000
  • Filing an income tax return with the Canada Revenue Agency (CRA)
  • Having a federal tax registration

To gain a better understanding of these requirements, let’s explore the roles of the CRA and financial institutions in determining CEBA eligibility.

Canada Revenue Agency

Though the CRA does not directly administer CEBA loans, they play a pivotal role in determining eligibility based on payroll and attestation requirements. Businesses must file an income tax return with the CRA and have a federal tax registration to be eligible for a CEBA loan, which is a financial assistance program provided by the federal government.

The CRA’s involvement also extends to the tax treatment of CEBA loans and any potential forgiveness of the loans. It’s always a good idea to consult a tax professional to ensure your business meets all necessary requirements.

Financial Institution Involvement

Financial institutions play an integral part in the administration and delivery of CEBA loans, working in collaboration with organizations like Export Development Canada (EDC) to provide these loans to eligible businesses. In fact, more than 230 financial institutions have been engaged in providing CEBA loans, ensuring that small businesses and not-for-profits have access to the necessary financial support during these challenging times.

As a small business owner, it’s essential to maintain a strong relationship with your financial institution to ensure you receive the best possible support and guidance in managing your CEBA loan.

Maximizing Loan Forgiveness

CEBA Loan Forgiveness

Loan forgiveness is a key benefit of CEBA loans, allowing businesses to have a portion of their loan forgiven if they repay the loan balance by December 31, 2023. To make the most of this opportunity, businesses should develop effective repayment strategies and aim for partial loan forgiveness.

Let’s explore these two strategies in more detail.

Partial Loan Forgiveness

Partial loan forgiveness is a program offered by CEBA loans that allows eligible borrowers to qualify for forgiveness on a portion of their loan. To meet the requirements for partial loan forgiveness, businesses must be in good standing and repay the balance of their loan by December 31, 2023.

The advantages of partial loan forgiveness include a decrease in loan payments, an increase in cash flow, and enhanced financial stability for businesses. By striving for partial loan forgiveness, businesses can alleviate some of the financial burden brought on by the pandemic.

Repayment Strategies

Creating a repayment plan is essential to reap the benefits of loan forgiveness. Keeping pace with repayments ensures that the loan will be paid back in a timely manner. One possible strategy is to make monthly payments to repay 66 percent of the total amount by the forgiveness deadline of December 31, 2023. By doing so, businesses can qualify for a loan forgiveness amount of the remaining 34 percent.

If the loan is not settled by the end of 2023, it will no longer be a short-term loan. It will be converted into a two-year term loan at 5% interest. It’s important to stay diligent and focused on your repayment plan to make the most of your CEBA loan.

Allocating CEBA Loan Funds Wisely

CEBA loan funds usage

When it comes to utilizing CEBA loan funds, businesses must carefully consider their cash flow and prioritize their expenses. There are several methods businesses can employ to enhance their cash inflows before using their CEBA loan, such as offering incentives for prompt customer payments or using credit cards to quickly acquire payments.

To allocate CEBA funds effectively, businesses should focus on non-deferrable operating expenses and property taxes. Let’s look at these two areas in more detail.

Non-deferrable Expenses

Non-deferrable expenses include:

  • Rent
  • Property taxes
  • Utilities
  • Insurance
  • Regularly scheduled debt service

Prioritizing these expenses when using CEBA loans is crucial, as businesses may incur fees or miss out on early payment discounts or rebates if these expenses are not paid on time.

By focusing on non-deferrable expenses, businesses can ensure that essential costs are paid promptly and maintain financial stability during the pandemic.


Managing tax payments with CEBA funds can be a daunting task. The forgivable portion of CEBA loans, either $10,000 or $20,000, is to be included in taxable income in the year the loan is received. To ensure proper management of tax payments, it’s recommended to consult a tax professional or contact the Canada Emergency Business Account (CEBA) program directly.

By carefully managing tax payments, businesses can further optimize their CEBA loan usage and maintain financial stability during these trying times.

Professional Advice and Support


Make the most out of CEBA

Seeking professional advice and support is invaluable for businesses navigating the complexities of CEBA loans. Here are some options for getting the help you need:

  1. Notices are being sent out to CEBA loan recipients by financial institutions. Make sure to read these notices carefully for important information about the loan.
  2. The CEBA Call Centre is available to address any queries pertaining to eligibility criteria. You can reach them at [phone number].
  3. Businesses can also contact their financial institution directly for further information concerning the loan or repayment. They will be able to provide you with specific details and guidance.

Let’s explore the CEBA Call Centre and banking services in more detail.

CEBA Call Centre

CEBA call center

The CEBA Call Centre serves as a valuable resource for businesses seeking assistance and answers to general questions concerning their CEBA loan. Operating Monday-Friday, 9am-6pm ET, excluding statutory holidays, the CEBA Call Centre is there to provide support and guidance on the CEBA program.

If you have any questions or concerns about your CEBA loan, don’t hesitate to reach out to the CEBA Call Centre at 1-888-324-4201.

Banking Services

Financial institutions offer a range of banking services to help businesses manage their CEBA loans effectively, such as loan repayment plans, loan consolidation, and loan refinancing. By maintaining a strong relationship with your financial institution, you can access the support and guidance necessary to manage your CEBA loan efficiently.

To optimize your CEBA loan, consider using strategies such as budgeting, establishing automatic payments, and taking advantage of loan forgiveness programs. Your financial institution can provide valuable advice and assistance in implementing these strategies.


Navigating the financial challenges imposed by the COVID-19 pandemic is undeniably difficult, but CEBA loans offer a lifeline to businesses in need. By understanding the program, maximizing loan forgiveness, allocating funds wisely, and seeking professional advice, businesses can weather the storm and emerge stronger. Remember, with the right strategy and support, your business can not only survive but thrive during these unprecedented times.

Frequently Asked Questions

Will CEBA be forgiven?

Yes, CEBA loans can be partially forgiven if they are repaid before December 31, 2023. Those who received $40,000 or $60,000 will have $10,000 and $20,000 forgiven respectively.

After January 1, 2024, however, none of the loans will be forgiven.

When can CEBA be paid back?

The CEBA loan repayment is due on December 31, 2023. After that date, the remaining balance will be subject to a 5% annual interest rate and must be paid off in full by December 31, 2025.

What can CEBA money be used for?

CEBA money can be used to cover immediate operating expenses. It is intended for businesses and non-for profits with a payroll between $20,000 and $1,500,000.

Funds must be used to fund non-deferrable operating costs and may be subject to review by the government at a later date.

What is the maximum CEBA loan?

The maximum CEBA loan available to businesses is $60,000, with a forgivable portion of up to $20,000.

Is CEBA extended to 2023?

The Liberals have announced an extension to the CEBA repayment deadline, setting it to the end of 2023.

Consequently, CEBA has been extended to 2023.

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