Special Post

CEBA Repayment Expansion Confirmation

This special edition post follows my most recent Tax Tip Thursday post talking about CEBA loan repayment extensions. If you got one, it should look something like this! (Note that I’ve edited out any personal information)

RBC Royal Bank
Important updates to the terms of your CEBA loan and repayment reminders
 

####### CANADA CORPORATION,

RBC values the relationship we have with you and we recognize the critical role that businesses play in the Canadian economy. We are here to provide you with advice on your specific business needs as you continue to navigate during these challenging economic times.

We are writing to you today with an important update on the Canada Emergency Business Account ("CEBA") program and to remind you of the steps you can take to make repayments to your CEBA loan. Effective October 7, 2022, your CEBA loan balance was $60,000.00.

The Government of Canada has asked us to inform you that, in respect of the loan your business received under the CEBA program, the following dates have been extended:

•

The repayment deadline for partial loan forgiveness has been extended by one year, from December 31, 2022 to December 31, 2023. Accordingly, you will now be eligible for partial loan forgiveness as provided for under the terms of the CEBA program if the outstanding balance of your CEBA loan (other than the amount available to be forgiven) is repaid on or prior to December 31, 2023.

•

The interest-free period has been extended by one year. Accordingly, if your loan remains outstanding on January 1, 2024, interest at a rate of 5% per annum will commence.
 

For a copy of the updated CEBA Agreement Terms and Conditions incorporating these date extensions, please click here and select the version appropriate to your CEBA loan.

Additionally, we wanted to advise you of the following:

•

You can make payments to your CEBA loan at any time through online banking for business or RBC Express.

•

We will automatically close your CEBA loan once the outstanding balance equals your eligible forgiveness amount of $20,000.00.

 

For more information on making loan repayments, or to discuss solutions to support your business, please contact your relationship manager or an RBC Advisor at 1‑800‑769‑2520. For other information, please visit our Frequently Asked Questions at rbc.com/ceba.

Please see the legal details at the end of this message for more information and specifics.

We refer to the CEBA Loan Agreement between Royal Bank of Canada (defined as the "Lender") and ####### CANADA CORPORATION (defined as the "Borrower") (as may have been amended or supplemented to the date of this notice, the "Loan Agreement"), entered into pursuant to the Canada Emergency Business Account program (defined as "CEBA") and related CEBA loan documents including signed attestations (collectively defined as the "Loan Documents"), in which certain funds were advanced by the Lender to the Borrower, based on the terms and conditions contained within the Loan Documents.

The Government of Canada has authorized and instructed us to notify you as follows:

(a)

 you will be eligible for partial loan forgiveness as provided for under the terms of the CEBA program if (i) your loan is in good standing under the CEBA program as of the date of this notice, and (ii) the outstanding balance of the loan (other than the amount available to be forgiven) is repaid on or prior to December 31, 2023;

(b)

 if your loan is not repaid in full on or prior to December 31, 2023, interest on the loan shall accrue and be payable commencing January 1, 2024 in accordance with the existing terms of the loan until repaid in full; and

(c)

 if your loan is in good standing under the CEBA program as of the date of this notice, no interest payments shall be required for the period from January 1, 2023 through December 31, 2023 and we hereby waive all interest payments that accrue during the period from January 1, 2023 through December 31, 2023, but expressly reserve all rights and remedies with respect to the accrual and payment of interest commencing on January 1, 2024.

The foregoing waiver shall be effective only in this instance and for the specific purpose for which it is intended and shall not be deemed to be a waiver of compliance with any other provision of the Loan Documents. For greater certainty, we expressly reserve all of the rights and remedies under the Loan Documents and otherwise available under applicable law, to take such steps as we deem necessary or appropriate to recover the outstanding amounts, if same are not paid on or before the applicable dates provided for in the Loan Documents.
 
 
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Disclaimer:

This article provides information of a general nature only. It is only current at the posting date. It is not updated and it may no longer be current. It does not provide legal or tax advice nor can it or should it be relied upon. All tax situations are specific to each individual. If you have specific tax questions you should book an appointment for a 1 on 1 consultation.