CEBA loan extension: when is yours due?

Posted on 6 February 2024

Written by Chris Galea

The Canada Emergency Business Account (CEBA) has been a crucial lifeline for many businesses facing financial challenges from the COVID-19 pandemic. It provided interest free loans of up to $60,000 to eligible parties, some of which could be forgiven if repaid by a certain deadline. Between April 2020 and June 2021, the CEBA program provided Canadian businesses with $49 billion dollars in interest-free loans. As the economic landscape continued to evolve, the government recognized the ongoing impact of the pandemic and introduced extensions to the CEBA program to provide additional support for those struggling to make their repayments. This CEBA loan extension introduced the option for borrowers to receive an additional $20,000 in loans – $10,000 of which was forgiveable if paid by a certain date. In this article, we explore the details of the CEBA loan extension and help you determine what to do if your repayment is overdue.

Important CEBA repayment dates

Here are the most important dates from the CEBA repayment timeline:

  • December 21, 2022 – this was the CEBA repayment deadline for the original $40,000 loan for businesses. Of course, for some these repayment terms may have differed slightly, so it is important to confirm your specific terms and deadline. It’s crucial to understand your deadline so that you can maximize the forgiveness opportunity and reduce the financial weight on your business.
  • December 31, 2023 – this was the extended repayment deadline for the additional $20,000 that was offered. For anyone who opted for this additional amount through the CEBA loan extension, this was the new repayment deadline.
  • January 18, 2024 – the government once again extended the deadline for repayment of the $20,000 loan, providing businesses with more time to manage their financial obligations.
  • March 28, 2024 – for any CEBA loan holders that filed a refinancing application with their lender by January 18, 2024, the repayment deadline for partial loan forgiveness has been extended to March 28, 2024. This is to allow more small businesses and not-for-profits to access relief and hear back from their lenders about their refinancing applications.

How do you know when your CEBA loan repayment is due?

In order to determine when your CEBA loan repayment is due, it is best to contact your financial institution that initially lent you your CEBA loan. They can then provide you with specific information about your repayment terms and deadlines. Alternatively, you can also check the CEBA website or government portal to see the latest information and updates on the program. The government will often share guidance for borrowers to make sure they are clear on any changes to the program.

What is the current status of the CEBA loan extension?

As of January 19, 2024, outstanding CEBA loans will convert to a three year term loan, accompanied by an interest rate of 5% per year. The CERB loan repayment date has therefore been extended accordingly, from an original date of December 31, 2025 to December 31, 2026. This means that any small businesses and not-for-profits have suddenly gained access to a low interest loan of up to $60,000 if they have not yet repaid or refinanced their loan. This is good news for anyone who cannot generate enough cash flow to repay their loan before the forgiveness deadline. It also gives you another year to continue your repayments at a low interest rate. Any CERB loan holders who paid back their loan on or before January 18, 2024 (or March 28, 2024 if a refinancing application was submitted) will now be forgiven $10,000 on a $40,000 loan and $20,000 on a $60,000 loan.

What if you do not repay your CEBA loan?

If you are unable to repay your CEBA loan when it is due, your financial institution will be in touch to request a lump sum repayment of the outstanding debt. If, at this point, you do not repay your CEBA loan in full to your financial institution, your loan will likely be assigned to the government’s CEBA program for debt collection. In spring 2024, the CEBA program will begin managing the collection of CEBA loans in default. At this point, you will be contacted directly. Although the CEBA program recognizes that recovery from the pandemic has been difficult and it will try to help, there are consequences for not making your repayment. If you are concerned about your situation, book a free consultation with a Licensed Insolvency Trustee at Spergel, the ‘get rid of debt’ people, to discuss your repayment options. Trudeau has confirmed that there will be no further CEBA loan extension, and so it is now more important than ever to get your situation resolved.

CEBA loan extension FAQs

Will CEBA be extended to 2024 in Canada?

Back in September 2023, the deadline for CEBA loan repayment was extended in order to qualify for partial loan forgiveness of up to 33%. This deadline was extended from December 31, 2023 to January 18, 2024. Trudeau has since confirmed that no further CEBA loan extension will take place.

What happens to your CEBA loan if your business closes?

Unfortunately, all CEBA loan holders (despite whether business is open or not) will need to repay your loan as per the repayment terms they signed up to when accepting the loan. Our experts at Spergel can help if you are facing repayment and do not think you can afford it.

Staying informed about the CEBA loan extension and the steps you need to take in order to repay your loan is crucial. By understanding the important dates associated with your CEBA loan, you can proactively manage your financial responsibilities and make the most of the available relief measures. If you have any uncertainties or questions, book a free consultation with Spergel, the ‘get rid of debt’ people. 

Chris Galea

Chris Galea

Chris Galea is a Chartered Accountant and Insolvency and Restructuring Professional with over 20 years’ experience as an LIT (Licensed Insolvency Trustee). He is also our resident expert on tax debt, COVID debt, and the region of Saskatchewan, Canada. When he’s not at the office educating people about bankruptcies and consumer proposals, Chris is playing pick-up hockey with his friends, spending time with his family, and learning Spanish!

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