Who funds the internship programs?

Colleges and Institutes Canada (CICan) receives funding from the Government of Canada’s Youth Employment and Skills Strategy. CICan acts as a delivery organization for the following programs:

Can the internship programs funding be combined with the CEWS?

For the Digital Tech and ImpAct programs that already cover up to 100% of the intern’s salary, you cannot combine the funding with the Canada Emergency Wage Subsidy (CEWS).

For the Natural Resources and Clean Tech subsidies, it is possible to combine funding with the CEWS. However, it is important to declare this in your budget so that adequate subsidy calculations can be made. If the CEWS is only indicated at the midterm or end of the internship, it will lead to a reduction in the subsidy payment.

Are wage subsidies under the Career Launcher program taxable?

Yes. According to the Canada Revenue Agency, if you get a grant or subsidy from a government or government agency, you’ll have to report it as income or as a reduction of an expense.

Generally, a grant or subsidy:

  • increases your income or reduces your expenses
  • relates to an income deficiency
  • relates to specific expenses

For example:

  • if you are a farmer and you received a payment to subsidize your income in a drought year, you would add the payment to your income.
  • If you are a business that receives a government employment grant to hire more students, you would generally deduct it from the wage expense you are claiming.

If your government assistance enables you to acquire capital property, it should not increase your net income. However, for depreciable property, you would reduce the capital cost of the property by the amount of the assistance received. For other capital property, you would reduce the adjusted cost base accordingly.

Does the subsidy cover Mandatory Employer Related Costs (MERCs) and Vacation Pay?

The subsidy covers employer charges including the Canada Pension Plan (CPP), Employment Insurance (EI) and vacation pay. Employers may choose to pay out the 4% in lieu of vacation or to offer vacation within the contract.

Should employers wish to provide paid vacation days, they will need to ensure that the intern still completes the minimum length of the internship. Please note that the Clean Tech Internships and the Natural Resources Internships need to be a minimum of 26 weeks.