Calculate your TWS amount
The 10% Temporary Wage Subsidy for Employers (TWS) is equal to 10% of the remuneration you pay from March 18 to June 19, 2020, up to $1,375 for each eligible employee. The maximum total for each eligible employer is $25,000.
Note: Associated Canadian-controlled private corporations will not be required to share the maximum TWS of $25,000 per employer.
How to calculate your subsidy
The Canada Revenue Agency will not automatically calculate the allowable subsidy. As the eligible employer, you are responsible for calculating the subsidy manually.
To calculate your subsidy:
- Determine the total number of eligible employees employed from March 18 to June 19, 2020.
- Multiply the number of eligible employees by the maximum of $1,375 per eligible employee. Make sure this amount does not exceed the maximum of $25,000 per eligible employer.
- Calculate your gross eligible remuneration from March 18 to June 19, 2020 (total of the 3-month salary for each eligible employee).
- Multiply your gross eligible remuneration by 10% to get your allowable subsidy amount. Make sure this amount does not exceed the maximum of $1,375 per eligible employee or $25,000 per eligible employer.
Calculating eligible employees
When calculating the total number of eligible employees, it is important to note that an employee is considered eligible if they are employed for any length of time from March 18 to June 19, 2020. This includes an employee that is:
- employed for the entire three-month eligibility period
- laid off and re-hired at any point in the three-month eligibility period;
- permanently laid off at any point in the three-month eligibility period; or
- hired at any point in the three-month eligibility period.
The following examples may help you determine the eligible amount, based on your circumstance:
Examples: Subsidy amount is below the maximum allowable amount
Example 1
You pay 5 eligible employees monthly salaries of $4,100 for a total monthly payroll of $20,500. Your wage subsidy for the month will be 10% of $20,500, or $2,050.
For the three-month period, if all your payroll information remains the same in each month, you will pay $61,500 of remuneration. Therefore, 10% of the remuneration you pay in the three-month period is $6,150.
Since this amount is below the maximum allowable amount of $6,875 ($1,375 x 5 employees), your total wage subsidy for the 3-month period will be $6,150.
Example 2
You pay 5 eligible employees monthly salaries of $4,100 for a total monthly payroll of $20,500. Your wage subsidy for the month will be 10% of $20,500, or $2,050.
In the second month, you pay 7 eligible employees monthly salaries of $4,100 for a total monthly payroll of $28,700. Your wage subsidy for the second month will be 10% of $28,700, or $2,870.
In the third month, you also pay 7 eligible employees monthly salaries of $4,100 for a total monthly payroll of $28,700. Your wage subsidy for the third month will be 10% of $28,700, or $2,870.
For the 3-month period, you will pay $77,900 of remuneration. Therefore, 10% of the remuneration you pay in the 3-month period is $7,790.
Since this amount is below the maximum allowable amount of $9,625 ($1,375 x 7 employees), your total wage subsidy for the 3-month period will be $7,790.
Example: Subsidy amount is above the maximum allowable amount
You pay 8 eligible employees monthly salaries of $4,750 for a total monthly payroll of $38,000. Your wage subsidy for the month will be 10% of $38,000, or $3,800.
For the 3-month period, if all your payroll information remains the same in each month, you will pay $114,000 of remuneration. Therefore, 10% of the remuneration you pay in the three-month period is $11,400.
Since this amount is above the maximum allowable amount of $11,000 ($1,375 x 8 employees), your total wage subsidy for the 3-month period will be capped at $11,000.