Congregational Finances During the Pandemic 2021-1 - The United Church of Canada L'Église Unie du Canada
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Congregational Finances
During the Pandemic – 2021-1
The United Church of Canada
L’Église Unie du Canada
January 27, 2021
Erik Mathiesen
Clyde Harris
Angelica BenalcazarA New Creed *
We are not alone, We are called to be the Church:
we live in God’s world. to celebrate God’s presence
We believe in God to live with respect in Creation,
to love and serve others,
who has created and is creating
to seek justice and resist evil,
who has come in Jesus
to proclaim Jesus, crucified and risen,
the word made flesh
our judge and our hope.
to reconcile and make
In life, in death, in life beyond death,
new
God is with us.
who works in us and others
We are not alone.
by the spirit.
Thanks be to God.
We trust in God.
EHM ~ The United Church of CanadaWhat We Cover Tonight - January 27
Latest news
– Year end items – PD27, T4, T2200, statistics
– New Tools – Church Hub, Teampay
– 2021 Budget and AGM considerations
– Federal program news & deadlines (CEWS etc)
– Emergency United Church loan program
– Admin reminders (M&S, assessment, insurance)
– Your questions
– HASCAP announced Jan 26 not applicable to us
None of us signed up for all we are managing!
EHM ~ The United Church of CanadaPD27 – finally!!!
Treasurer must complete and submit the form
Suggest submitting online if you have your
account set, but snail mail OK too
Form is self explanatory
Field by field data can be found this weekend
https://united-church.ca/leadership/church-
administration/compensation-and-
benefits/compensation-ministry-
personnel/pastoral
EHM ~ The United Church of CanadaPD27 – finally!!!
Spreadsheet entitled "PD27 extracts"
Search by your RP# to protect confidentiality
Search United Church payroll service if you
don’t have it book marked
EHM ~ The United Church of CanadaPD27 Solution
You are encouraged to provide all the information
requested on Form PD27 and submit it to the CRA as
soon as possible to avoid receiving a discrepancy
notice at the end of the year. You do not need to wait
until you file your T4 information return.
EHM ~ The United Church of CanadaPD27 Solution
CRA has not issued a deadline but are asking
ASAP.
EHM ~ The United Church of Canada10% Subsidy Reporting - PD27
“Temporary Wage Subsidy Self Identification
Form for Employers
to be signed by employer or authorized officer
EHM ~ The United Church of Canada2020 T4 reporting for Federal monies For the tax year 2020, in addition to reporting employment income in Box 14 or Code 71, use new other information codes when reporting employment income and retroactive payments in the following periods: Code 57: Employment income – March 15 to May 9 Code 58: Employment income – May 10 to July 4 Code 59: Employment income – July 5 to August 29 Code 60: Employment income – August 30 to September 26 If using ADP, don’t even look at this! EHM ~ The United Church of Canada
2020 Accounting for Federal monies
For the tax year 2020, the CRA is suggesting accrual based
accounting. However, charities have a choice in to elect cash or
accrual for T3010 filing.
If accrual accounting, then book Period 10 revenue in 2020 and
set up an account receivable
If cash accounting, book subsidy amounts when received
CEBA loan accounting gets is goofy and gets its own slide
Note: everyone should have met the December 31,
2020 deadline for filing their 2019 T3010.
EHM ~ The United Church of CanadaIs CEBA loan accounting goofy? Yes
Total loan $40,000 ($60,000)
Entry in financial records for 2020:
– Debit (Asset) in Bank 40,000
– Credit (Liability) Loan 30,000
– Credit (Revenue) Forgivable 10,000
OR
– Debit (Asset) in Bank 60,000
– Credit (Liability) Loan 40,000
– Credit (Revenue) Forgivable 20,000
Reference - https://www.taxtips.ca/federalbudget/covid-financial-
relief/forgivable-loans-taxation.htm
EHM ~ The United Church of CanadaT2200 - working from home
Sign a T2200 form for an employee if asked
But most lay employees will be claiming all or part of
a simplified $400 deduction for employees working
from home due to the COVID-19 pandemic in 2020.
These employees will be allowed to deduct up to
$400 (based on a per diem amount for the number of
days working from home, up to this maximum), with
no requirement to track or report detailed expenses.
Note: it appears that this deduction might not
benefit ministers who claim a Clergy Residence
Deduction. Accountants may disagree.
EHM ~ The United Church of CanadaT2200 - working from home
Sign a T2200 form for an employee if asked
CRA is going to be flexible on whether mandate or
not
EHM ~ The United Church of CanadaAnnual statistics*
Federal grant revenue should be reported but
won’t impact your assessment.
To calculate your average weekly attendance
for your 2020 annual statistical submission,
please add the number of people in in-person
worship to the on-line count and report that
number.
Strongly recommend using online church hub
2020 will have an asterisk for many reasons!
EHM ~ The United Church of CanadaQuestions so far EHM ~ The United Church of Canada
Teampay – long awaited!
On line updating, Real time verification
Online report access any browser/device
Ongoing 1-800 # support but only if or when
you need it
Price increase but well worth it.
– $22.00 per payroll run
– $1.20 per employee
– Fees good for 1 year from implementation
EHM ~ The United Church of CanadaTeampay - payroll
Phase 1 – existing process but online access to
reports changes Q1 2021
Phase 2 – rollout on line functionality Q2
– Enhanced new hire/payroll form
– Improved User guides and tools
– One on one handholding as needed
– Due to handholding will take several
months to switchover everybody
EHM ~ The United Church of CanadaTeampay rollout GET THOSE SIGN OFF AUTHORIZATIONS IN !!! EHM ~ The United Church of Canada
Shout out to the payroll team
Hena Murati
Olga Saranchuk
Eileen Dai
Angelica Benalcazar, BHRM
Manager, Human Resources & Payroll
Thank you for leapfrogging us into the future.
EHM ~ The United Church of CanadaChurch Hub for treasurers
New on line system for local church
administration
Already up and running for ministers, church
administrators and search committees
Authorized ADP Treasurers to all be enrolled
in February
On line portal for assessment statements and
statistics
Works on all devices
One time set-up of user account. Help desk.
EHM ~ The United Church of CanadaChurch Hub for treasurers - 2
Treasurers to all be enrolled in February
Look for e-mail next week
One time set-up of user account with
password
Help desk available, but hopefully by now we
have gotten used to needing online accounts
and passwords.
EHM ~ The United Church of Canada2021 Budget considerations
GUESSING GAME
– How much subsidy to budget for?
– Church fully open by what date?
– Lasting impacts from Covid?
Assessment held level for majority
COLA for minimum ministry salaries 2.2%
Staff benefit cost increase (see tools for treasurers)
Minor increase in ADP payroll costs depending on
timing of migration to Teampay
insurance premiums still heading up
EHM ~ The United Church of CanadaGovernance extensions approved
a) extend the temporary amendments to pastoral relations policies
that were originally adopted in April, 2020;
b) temporarily suspend the requirement in section B.5.1 of The
Manual for congregations or pastoral charges to hold an annual
meeting; and
c) temporarily amend the responsibility of the congregation or
pastoral charge to make a decision on their annual draft budget
by allowing the governing body of the congregation or pastoral
charge to fulfil this responsibility where necessary,
with each of the foregoing to be in effect until June 30, 2021
EHM ~ The United Church of CanadaPreparing for 2021
2021 budget – leave yourself wriggle room!
compensation changes for Jan 1
2020 T4 Summary for signoff
2021 reporting requirements
– PD27 for 10% TWES reporting due April 2021
– 2021 assessments set up on PAR?
– 2020 and 2021 M&S transfers consider e-payment
– 2021 national church statistics (March)
Transition to teampay
EHM ~ The United Church of CanadaAny further questions EHM ~ The United Church of Canada
Federal Wage Subsidies keeps evolving 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 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. EHM ~ The United Church of Canada
CEWS news – January 6, 2021
The economic statement provides details for the
CEWS, CERS and Lockdown Support programs for:
period 11 – December 20, 2020 to January 16, 2021
period 12 – January 17, 2021 to February 13, 2021
period 13 – February 14, 2021 to March 13, 2021
Details for these programs for March 14, 2021 to
June 30, 2021 will be provided at a later date.
In short, everyone should be doing CEWS
spreadsheets each month.
EHM ~ The United Church of CanadaCEWS new info
December 2020 – for claim period 11
(see note below);
January 2021 – for claim period 12;
February 2021 – for claim period 13; and
currently there are no prescribed periods after
claim period 13.
Note: The reference period for claim period 11 is the
same as for claim period 10. This is to better align the
reference periods with the claim periods.
EHM ~ The United Church of CanadaCEWS deadlines added online Periods 1 – 5 January 31 deadline Period 6 – February 25 deadline Period 7 – March 25, deadline Period 8 – April 22 deadline Deadline now is basically 6 months after 2019 T3010 filing deadline – PAST DUE CEBA deadline extended to March 31,2021 EHM ~ The United Church of Canada
CEWS – adjusting your filing
Meant for minor adjustments
If a major change then it might flag for review
If a similar change for more than three
periods almost certain review
Is the change worth it?
Never change C2 or C3
Only provide the changed line C, D, E, F or G
Deadline to file a change to increase claim filed by January 31, 2021 or 180 days after end
of Period whichever is later
No deadline to reduce or cancel previous claim
Must be prepared to repay overpayment quickly
Can be processed totally online with access to Business Account
Representatives must have a level 2 or level 3 authorizationFederal 75% (CEWS) Elections/Attestation
One time option to change reference period for periods 5-9
NOTE: Most of us will have used monthly income from prior
year to determine eligibility,
– Ie. March 2020 versus March 2019
For periods 5-9 you could elect to change this
– Could elect to compare current months to average of Jan
Feb 2020 (but need to carry thru for periods 5-9)
– This may be advantageous to congregations highly
dependent on donations
– Less likely to be advantageous if you had significant rental or
event income in those months..
EHM ~ The United Church of CanadaFederal 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, box 6 to
exclude asset sales, Box 7 if you are using the option of comparing the current revenue to
the average of January and February 2020 for periods 1-4; Box 8 if for periods 5-9
Box 9 to exclude gov’t income; Box 10 for allowed compensation exceptions.
EHM ~ The United Church of CanadaProvincial Grant Programs
Ones we know about where churches got money
Manitoba Bridge Grant - $5,000
Nfld/Labrador Small business assistance
Haven’t heard about other provinces, but do
share any news in the chat space.
And lobby for eligibility.
EHM ~ The United Church of CanadaIs CEBA loan accounting goofy? Yes
CEBA Loans Accounting questioned by you.
CRA/ CPA advise the forgivable portion to be taken
into Revenue in 2020.
The Loan (Liability) is paid down starting in 2021
– Paid in full by end of 2022.
Reference - https://www.taxtips.ca/federalbudget/covid-financial-
relief/forgivable-loans-taxation.htm
On T3010 revenue portion on line 4540, loan portion line 4330
EHM ~ The United Church of CanadaCEBA expansion Application deadline: March 31, 2021 Apply on-line !! If questioned, request an eligibility letter CRA on line tool much improved https://ceba-cuec.ca/ EHM ~ The United Church of Canada
CEBA Clarification - recap
$40,000 Canada Emergency Business Account, now
increased to $60,000
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 up to 33 percent
NOTE: if repaying loan in 2020, all must be repaid.
Non deferrable expenses from all of 2020 count
EHM ~ The United Church of CanadaCEBA 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;
EHM ~ The United Church of CanadaRestrictions 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.
EHM ~ The United Church of CanadaCERS replaces CECRA (eff. 09/20)
If you have tenants, they apply directly.
The CERS subsidizes up to 65% of rent,
mortgage interest and related property
expenses. An additional subsidy of up to 25%
is available for organizations forced to close
their premises due to public health orders.
EHM ~ The United Church of CanadaCERS replaces CECRA (eff. 09/20)
Qualifying property
Properties that do qualify include any "real or
immovable property" (buildings or land) in
Canada that your business or organization:
owns or rents, and
uses in the course of your ordinary activities
EHM ~ The United Church of CanadaCERS clarification – own or rent
CERS potentially can apply to ownership
situations as well as if you are a tenant. Probably
not worth it????
Eligibility criteria for expenses
Only amounts paid or payable to an arm’s-length
party can be included (ie property tax, insurance)
The expense must be in respect of the claim period
(1/12)
The expense must be paid or payable under a written
agreement in place before October 9, 2020 (or a renewal on
substantially similar terms or assignment of such an agreement)
EHM ~ The United Church of CanadaCERS replaces CECRA (eff. 09/20)
If you own the qualifying property, your eligible
expenses are:
Property and similar taxes
– Includes school taxes and municipal taxes, if
these are part of your property tax assessment
Property insurance
Interest on commercial mortgages for the purpose of
purchasing real property
EHM ~ The United Church of CanadaProperty/Liability Insurance status
Rate increases by virtually all insurance companies
Requirements are stickier
– Need a current application on file (if > 5 years)
– Expect more inspections
– Hub valuation tool will check your amounts based
on information on the application
Hopefully with the big increases in 2020, we will see
less upward pressure in 2021 (depends on claims !)
Empty or closed buildings don’t get you a price break
at all – in fact the opposite - they are higher risk
EHM ~ The United Church of CanadaProperty/Liability Insurance status
When a building is 35+ years old insurers will
approach each client to find out what it has or plans
to do to upgrade heating/electrical/plumbing
Updated appraisals requested more often
Appraisal company names:
1. Duff & Phelps (formally known as American Appraisal) -
Canada & US
2. Suncorp Valuations - Canada & US
3. Risk Management services – Canada
4. Cunningham & Rivard Appraisal (Nanaimo) LTD.- CanadaBC
5. Brunsdon Lawrek & Associates - Canada - SK
EHM ~ The United Church of CanadaUnited Church loans– That was then, this is now
THEN Q1 2020 NOW
• Banks creating too much
• Offer to have national
hassle with local loans and
church guarantee local
line of credit. Will issue
loans with banks
loans ourselves rather than
• $10,000 emergency loan
guarantee
program created for
• National church has
congregations
arranged umbrella loan
• Intended to supplement or
facility
follow federal subsidy
• Foundation grant not yet
programs
fully spent
• Special United Church
• STILL intended to
Foundation grant
supplement or follow
federal subsidy programsUnited Church Emergency loans
$10,000 loans available online with expedited region
approvals
Published beginning and end dates will likely be
adjusted just like federal programs have been
Consider this to pay any lump sum catch-up amounts
for assessments due
https://united-church.ca/community-and-faith/being-
community/faith-communities-and-covid-
19/emergency-funding-congregations
or - Google United Church emergency loans
EHM ~ The United Church of CanadaAny further questions EHM ~ The United Church of Canada
Contacts for action
Getting set-up or fixed with CRA
CRAhelp@united-church.ca
ADP TEWS queries (authorization etc) payroll@united-church.ca
Reinstating assessments assessments@united-church.ca
Church loan payments mpimpinella@united-church.ca
Stewardship queries djagger@united-church.ca
United Church emergency loan
https://www.united-church.ca/community-faith/being-community/united-
church-emergency-supporterosity_in_unprecedented_times.pdf
EHM ~ The United Church of CanadaFollow-up questions
Erik Mathiesen
emathiesen@united-church.ca
1-800 268-3781 x4022
With apologies, response times will vary
depending on volumes.
EHM ~ The United Church of CanadaThank you for what you do for our church 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) EHM ~ The United Church of Canada
New D&O Insurance December 2020
change in carrier may affect you
Given that D&O insurance is placed on a “claims-made”
basis responding only to claims reporting during the
policy term, you should already have reported any
known claims before the switchover Dec 1, 2020,
No action required, if you have nothing to
report.
D&O ≠ abuse coverage
insurance certificate now online
EHM ~ The United Church of CanadaCyber Risk Insurance
To date have not purchased an
umbrella coverage for congregations –
under review
EHM ~ The United Church of CanadaInternal governance - recap
Wage or rental subsidy applications do not
require region approval
CECRA /CERS is like a grant
Any loan applications REQUIRE
– congregation board approval
– region approval (perhaps expedited)
– Online application by someone authorized
to “bind the applicant”
EHM ~ The United Church of CanadaTax Receipting exception situations
Not receiptable
– Minister purse
– Supporting a local family
Avoid gifts in kind (except for stock gifts!)
– Neither part can claim GST/HST
– Extra admin > swap cheques
EHM ~ The United Church of CanadaHonorariums
Payment of honorariums is common for
– Pulpit supply
– Situations where task too big to reasonably
ask to be done fully voluntary
– T4a if >$500 total for the year
Note: a volunteer governor cannot be
compensated for serving on a charity board.
Treasurer must be a member. Bookkeeper
doesnot
EHM ~ The United Church of CanadaCra HOW TO GET ONLINE
https://www.canada.ca/content/dam/cra-arc/serv-
info/charities/rfnc_gd_en.pdf?utm_source=charities&utm_medium
=eml
EHM ~ The United Church of CanadaHelp Desk for CRA enrollment EHM ~ The United Church of Canada
Multi point reporting of subsidies
If pastoral charge holds charitable status,
same as for single point
If underlying points hold charitable status
– Charge should allocate subsidies and
pay to points
– Do NOT offset allocations
– T3010 needs to show the subsidies
EHM ~ The United Church of CanadaYou can also read
