Canada Emergency Rent Subsidy (CERS) Update
Dear Valued Clients and Friends,
To further assist businesses who have experienced a decline in sales due to COVID-19, the federal government newly enacted the Canada Emergency Rent Subsidy (CERS) program. The subsidy is to help cover the costs of commercial rent, property taxes and other related expenditures, incurred from September 27, 2020 until June 2021. Support is provided directly to qualifying tenants and property owners, without requiring the involvement of landlords. Guidelines mirror the Canada Emergency Wage Subsidy (CEWS), including eligibility and the sliding rate scale.
-> Claim period 1: September 27 to October 24, 2020, Corresponds to CEWS Period 8 – Apply now
-> Claim period 2: October 25 to November 21, 2020, Corresponds to CEWS Period 9 – Apply starting November 30, 2020
->Claim period 3: November 22 to December 19, 2020, Corresponds to CEWS Period 10 – Apply starting December 23, 2020
Amount of Subsidy
The amount of subsidy received will be based on the revenue drop. For revenue losses of:
-> 70% or more, the base rate = 65%
-> 50% to 69%, the base rate = 40% (revenue drop – 50%) x 1.25
-> 1% to 49%, the base rate = revenue drop x 0.8
- Note that the base subsidy rate applies to a maximum of $75,000 in eligible expenses per location. There is also an overall maximum of $300,000 in expenses for an affiliated group per claim period.
- Additional Lockdown Support
- If your business was forced to temporarily shut down due to a public health order for one week or longer, you may be eligible for a Lockdown Support of 25% of eligible expenses per affected location. The rate applies to a maximum of $75,000 in eligible expenses per location and is pro- rated based on the number of days your business was mandated to close.Eligible ExpensesQualifying property includes any “real or immovable property” (buildings or land) in Canada that your business owns or rents and uses in the course of your ordinary business activities. There must be a written agreement in place before October 9, 2020. If you rent the property, eligible expenses include rent, property taxes, and regular customary ancillary services. For those whoown the property, eligible expenses include property taxes, property insurance, and interest on commercial mortgages. Not included are your home, cottage or any properties that are primarily used to earn rental income from arm’s-length parties.
How to Apply
Businesses can apply through their CRA “My Business Account”. A new CERS (ZA) number must be created, similar to the Payroll (RP) account.
With the novelty and complexity of the program for CERS, please do not hesitate to call or email your manager if you require assistance with eligibility, revenue and subsidy calculations, or with your application.
We hope you and your families stay safe and well. Sincerely,
Prasad & Company LLP
If you have any questions, you can reach us at:
(416) 226-9840 or
1 (888) 550-8227