Congregational Finances During the Pandemic 12...Payroll stream If you have a business account, can...

Congregational Finances

During the Pandemic – 12

The United Church of Canada

L’Église Unie du Canada

August 12, 2020

Erik Mathiesen

Clyde Harris

A New Creed

We are not alone,

we live in God’s world.

We believe in God

who has created and is creating

who has come in Jesus

the word made flesh

to reconcile and make

new

who works in us and others

by the spirit.

We trust in God.

We are called to be the Church:

to celebrate God’s presence

to live with respect in Creation,

to love and serve others,

to seek justice and resist evil,

to proclaim Jesus, crucified and risen,

our judge and our hope.

In life, in death, in life beyond death,

God is with us.

We are not alone.

Thanks be to God.

EHM ~ The United Church of Canada

What We’ll Cover Tonight August 12

Latest news

– Administration reminders (M&S, assessment, stats)

– Church helpdesk [email protected]

– 10% TWS processing and reporting

– CEBA and CECRA news and extension

– CEWS major changes & extension to December

Your questions

Information is accurate as at 3:00 p.m. EDT.

Information may be affected by subsequent

announcements.


mailto:[email protected]

Moving Targets August 12

Initially NO, but things evolved so churches are now:

– eligible for CECRA rent program (if tenant leases)

– eligible for CEBA loans (IF rental/sales revenue)

All charities with payroll # eligible for 10% TWS but now a new

reporting requirement

75% CEWS program MODIFIED and EXTENDED, details

posted Aug 11.

T3010 filing deadline extended to Dec 31, 2020

- more important than ever that our ministries obtain proper

CRA online account access

- Same goes for adding online donation capability through

Canada Helps (registrations almost doubled)


Those who are most

vulnerable in Canada and

around the world count on

Mission & Service gifts and

will even more now.

Transferring Mission & Service gifts as

regularly as

possible lets those we serve know how

much they can count on our support.

If your congregation hasn’t already

transferred Mission & Service donations

received so far, could you please do so as

soon as you are able.

Credit: Our Place

gives hope

thank you for your

dedicated leadership

The financial viability of our

beloved churches is of

utmost concern; We are also

concerned about those who

are suffering even more

now. Our shared Mission &

Service can help.

Thank you again for

faithfully supporting your

congregation’s ministry -

and our ministry together

through

Mission & Service. Credit: Massey Centre

Assessments Due this Fall

Assessment account statements will be issued in

September

Current plan is to add any residual amounts owing at

year end to the 2021 invoice

To restore or adjust PAR payments contact

[email protected]

Mail to General Council office if not paying online

Reminder: If you haven’t submitted your annual

statistics report, please do so ASAP



Help Desk for CRA enrollment


CRA Helpdesk – common problems

Churches having different payroll numbers and business

numbers

Directors/Trustees having end dates so no one is on file

deeming rule and if it is still going to be applicable going forward

CEBA – still having some issues with their financial institutions

saying they do not qualify

Represent A Client – still hearing frustrations about the delay

Web Access Code – if you get a code, you need to keep it on

hand, if you lose it, they have to start the whole process again

BOOKKEEPING- recommend separate account to track

subsidies. Need for reconciliations and T3010 (line 4540).


Federal 75% (CEWS) Elections/Attestation

Boxes 1, 2, 4 may be used by a multi-point pastoral charge depending on the circumstances

for determining revenue

Box 3 is ignored

Box 5 is checked if you are using cash method of accounting as opposed to accrual

Box 6 is checked if you are using the option of comparing the current revenue to the

average of January and February 2020

Box 7 is checked if the pastoral charge elects to exclude government grants from the

revenue calculations.


10% Subsidy processing

All church payroll entities eligible for 10% wage

subsidy (March 18- June 19). Same for other

ministries

1,300 pastoral charges will have the rebate

processing done for them by ADP and the national

office

Tools available online for those who choose to do it

themselves

– Temporary Wage Subsidy worksheet

– TWSE-TA Form Managed Services


10% Subsidy Processing

ongoing “clean-up” for the 1,300 pastoral

charges who signed up to have this done by

ADP and national payroll team

Status of individual church account varies:

– When signed up, frequency of payroll

submission, adequacy of “tax bucket”

– lots of exception or odd situations

Trust the system. Individual queries slow us

down. Check August payroll register.


10% Subsidy Reporting - PD27

introduced July 27, 2020 online

To be signed by employer or authorized officer

figuring out how we will do this for everyone

who is having this done by ADP


CEBA Clarification - recap

$40,000 Canada Emergency Business

Account

Churches and other ministries are ELIGIBLE

IF

Must have payroll >$20,000

Must have rental revenue on line 4610 or

sales revenue on line 4640 of T3010

Repaying the balance of the loan on or before December 31,

2022 will result in loan forgiveness of 25 percent (up to

$10,000).EHM ~ The United Church of Canada

CEBA Clarification - recap You have to be able to certify applicant :

is not a union, charitable, religious or fraternal organization or

entity owned by such an organization or if it is, it is a registered

T2 or T3010 corporation that generates a portion of its revenue

from the sales of goods or services;

It is not a non-profit organization, registered charity,

union, or a fraternal benefit society or order, or an

entity owned by such an organization, unless the

entity is actively carrying on a business in Canada

(including a related business in the case of a

registered charity) that earns revenue from the

regular supply of property/goods or services;


Restrictions on use of CEBA Funds

The funds from this loan shall only be used by the

Borrower to pay non-deferrable operating expenses

of the Borrower including, without limitation, payroll,

rent, utilities, insurance, property tax and regularly

scheduled debt service, and may not be used to fund

any payments or expenses such as

prepayment/refinancing of existing indebtedness,

payments of dividends, distributions and increases in

management compensation.


Applying for CEBA Funds-

Payroll stream

If you have a business account, can apply online at

major financial institutions

– Attestation is online too

Talk to your financial institution if online not available.

If payroll less than $20,000 and/or personal bank

account used – you probably aren’t eligible anyway

but you could explore the “non deferrable expenses

stream”. Erik the pessimist says this is a waste of

time.

https://ceba-cuec.ca/EHM ~ The United Church of Canada

https://ceba-cuec.ca/

CECRA – The Benefit

Canada Emergency Commercial Rent Assistance (CECRA) for

small businesses provides relief for small businesses experiencing

financial hardship due to COVID-19. It offers forgivable loans to

eligible commercial property owners to:

reduce the rent owed by their impacted small business tenants

meet operating expenses on commercial properties

Property owners must offer a minimum of a 75% rent reduction for

the months of April, May and June 2020.

Program now extended for July and August

- https://www.cmhc-schl.gc.ca/en/finance-and-

investing/covid19-cecra-small-business


https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business

CECRA - Eligibility

LANDLORD ELIGIBILITY

While the program is titled “Commercial” working with the Ontario

Non Profit Network we have confirmed that Not For Profits and

Charities who have properties that collect rent from eligible small

business owners will be eligible.

Must have a legal rental or lease agreement

Must have declared rental income on their 2018 and 2019 tax

returns (T3010) or make special case

No longer a requirement to have a mortgage, although it is

administered via CMHC


CECRA - Eligibility

TENANT ELIGIBILITY

Tenants must prove a 70% reduction in income-

compared to last year or to Jan/Feb 2020 incomes OR

have ceased operations

Tenants regular rent must be less than 50k per month

Tenants must earn less than $20 million per annum

Tenant must provide their business number for

application. If sole proprietor SIN.


CECRA Process

Landlords to submit certain documents:

– Tenant attestation re revenue

– Owner attestation

– Rent reduction agreement

Landlords to keep available

– Leases or rental agreements

Application available online.

Need to register first!

https://www.cmhc-schl.gc.ca/en/finance-and-

investing/covid19-cecra-small-business

SEE MAY 27 WEBINAR FOR “HOW TO” DETAILSEHM ~ The United Church of Canada

https://www.cmhc-schl.gc.ca/en/finance-and-investing/covid19-cecra-small-business

CECRA: The Calculation

Who Pays What:

The tenants pays up to 25% (cannot exceed that)

The provincial government pays 50%, retroactively for April,

May, June

The landlord accepts the 25% loss

Example: Tenant one pays $1,000 a month usually

With the CECRA they now pay $250, the government pays

$500 and the landlord forgives $250. This applies for three

months

If the month has passed the reduction can be applied to

future months or refunded


United Church Emergency Loan-recap

intended to supplement federal funding programs and

respond to transition from them as federal programs

expire.

Special case intervention now

Online now. Application goes automatically to region

for review

eligibility to be confirmed in consultation with the

region

needs based and viability based

THANK YOU United Church Foundation!


United Church Emergency Loan-recap

This $10,000 loan

– will be interest free if paid in full by September 30,

2021.

– if paid by September 30, 2021, $500 is forgiven for

a total repayment of $9,500.

– Interest at 2% starts to accrue on October 1, 2021

– Principal and interest will be paid within three

years from September 30, 2021.

– A payment plan will be developed with you.

dates may change to align with everything changing


Internal governance - recap

Wage or rental subsidy applications do not

require region approval

CECRA is a forgivable loan so for approval

purposes - a grant!

Any loan applications REQUIRE

– congregation board approval

– region approval (perhaps expedited)

– Online application by someone authorized

to “bind the applicant”


Questions so far


Federal Wage Subsidies @June 24

https://www.canada.ca/en/revenue-

agency/campaigns/covid-19-update/frequently-asked-

questions-wage-subsidy-small-businesses.html

75% - you apply for it – if eligible

https://www.canada.ca/en/revenue-

agency/services/subsidy/emergency-wage-subsidy.html

Excellent resource now. Be sure to read FAQ.


10% - you take it (and defer to ADP)

https://www.canada.ca/en/revenue-agency/campaigns/covid-19-update/frequently-asked-questions-wage-subsidy-small-businesses.html

https://www.canada.ca/en/revenue-agency/services/subsidy/emergency-wage-subsidy.html

CEWS – news Aug 11 July 17 June 24

Major changes in program design

Dates extended to November 21 at least

Most ministries likely to be eligible for some periods

Safe Harbour provision for periods 5 (July 5 to August 1)

and/or 6 (August 2 to August 29).

Period 5 application opens August 17. Updated

calculators and documentation posted yesterday.

BOTH HAVE ERRORS

https://www.canada.ca/en/department-

finance/news/2020/07/adapting-the-canada-emergency-

wage-subsidy-to-protect-jobs-and-promote-growth.html


https://www.canada.ca/en/department-finance/news/2020/07/adapting-the-canada-emergency-wage-subsidy-to-protect-jobs-and-promote-growth.html

Federal 75% (CEWS) Aug 11 Guidance


(CEWS) – new periods


CEWS new rates – any revenue drop


Federal 75% (CEWS) –top up

The following table illustrates how the top-up subsidy rate is calculated:

(applicable more to camps, and closed outreach agencies)


Federal 75% (CEWS) – phase out


Federal 75% (CEWS) – phase out 2


CEWS – Deeming rule change


The Deeming Rule:

As the 30% revenue reduction requirement

has been replaced for these periods, the

deeming rule has been changed. An eligible

employer will now use the greater of its

percentage revenue decline in the current

period and the decline in the previous period

for the purpose of determining its qualification

for the base CEWS and its base CEWS rate

in the current period.

Federal 75% (CEWS)

The CEWS will be processed at the payroll program

(RP) account level, so you will have to file a separate

application for each RP account.

Do a separate version of the CRA online calculator

and on line application for each RP#

For cases where some employees on ADP and some

not, you will need to have separate workpapers and

consolidate them for your application (depending on

whether different RP numbers)


75% CEWS processing – calculator

Separate spreadsheets for periods 1-4 vs 5-9

Revenue numbers now get input into the calculators

DON’T USE THE ONLINE CALCULATOR. BETTER TO HAVE

A SPREADSHEET RECORD (personal opinion)

– Download the calculation spreadsheet(s)

– Enter the claim period (dropdown menu)

– Go to Weekly tab to enter each individual

• Monthly salaries x 12 / 52 = weekly salaries

• Employee at Arm’s Length must be answered

• All pay figures on a weekly basis

• All weeks must have an entry even if 0.00

• Totals transferred to Instructions and Results


Federal 75% (CEWS)

There are three ways to apply all online:

– My Business Account

– Business representatives may apply using

Represent a Client. (need Level 2 or 3)

– If neither are an option for you, use the Web

Forms application with your web access code

Sign into the Web Forms application

Get a web access code (WAC) 1-800-959-5525

“help desk” support at [email protected]


https://apps.cra-arc.gc.ca/ebci/ghnf/netf/prot/ntrWgSbsdyStndAln.action?request_locale=en_CA

https://apps.cra-arc.gc.ca/ebci/leb0/wacretrieve/pub/disclaimer.action?request_locale=en

Cybersecurity - more scams

COVID-19 related transition tools has

created opportunity for scammers

Most recently reports of purported

messages from national office asking for

e-payment (followed up with phone call)

Phishing attempts often use name of

someone you know.

Don’t click on links or send info without

checking.


Insurance matters

Insurance rate increases of 30% or more

– 30% for UCC Protect program

– Reports of 40% + from others

UCC Protect relatively flexible on Covid-19

closing (visits 2x week vs. daily for some)

Insurance companies have not identified any

incremental requirements for re-opening


Questions so far


Logging into CRA Accounts or Service Canada

Can’t avoid having online accounts for a charity anymore

Reasonably straightforward unless

– Your numbers don’t make sense (RP should equal RR)

– You have previously been registered but don’t now know the

contact name

– You have inadvertently de-listed your trustees/directors

– You maintain payroll “off” ADP

To help you get there:

[email protected]

Rose, Carla and Clyde will try to help you navigate

any complexity.



Reconciling all this later this year

– So much happening at once and changing…..

– Inevitable that there will be some duplication or

errors in claims

– Reconciliation in the fall for

• Maximization of 10% wage subsidy (max

$1,375 per employee or 10% of total wages)

• Reconciling 10% adjustment on 75%

– Keep books and records substantiating

• Eligibility calculations/determinations

• Your calculations


Summary of what you need to do for wage

subsidies– Solve the online application challenge

– PROCESS the 10% transactions (have ADP/GCO

do or do it yourself)

– Determine your CEWS subsidy eligibility and for

which periods.

– If eligible for the CEWS

• Use CRA spreadsheet for overall calculations

• Use ADP/church spreadsheet for 10%

adjustment

• File online by whichever method will work

• Keep complete records for each filingEHM ~ The United Church of Canada

Contacts for action

Getting set-up or fixed with CRA

[email protected]

ADP TEWS queries (authorization etc) [email protected]

Deferring/ reinstating assessments [email protected]

Church loan payments [email protected]

Stewardship queries [email protected]

United Church emergency loan

https://www.united-church.ca/community-faith/being-community/united-

church-emergency-supporterosity_in_unprecedented_times.pdf







https://www.united-church.ca/community-faith/being-community/united-church-emergency-support

https://www.united-church.ca/sites/default/files/resources/generosity_in_unprecedented_times.pdf

Closing


We say "we'll get through this" and yet grieve that so many will not.

We say "we're in this together" and yet know the huge chasms in our

experience.

We say "we'll build back better" and yet feel the tug into familiar grooves of

inequity and excess.

Creator. be with us.

Console us in our losses.

Shelter us in our hopes and intentions.

Embolden us in our dreams and gestures.

Come alongside us as we yearn, confirm and act towards your holy and

beautiful intention of right relations for peoples and our aching wounded earth.

Amen

Jennifer Henry, KAIROS

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