With both the Canada Emergency Rent Subsidy (CERS) and Lockdown Support program set to expire in June, the 2021 Federal Budget has extended the programs to allow for a gradual phase-out, while still supporting businesses.
Both programs will run for an additional five periods, beginning on June 6, 2021, and ending on October 23, 2021.
Extending the CERS
The CERS will continue to provide a base subsidy based on revenue decline for eligible renters, with the Lockdown Support providing an additional 25% top-up subsidy if the renter is forced to close or reduce operations due to public health restrictions.
Similar to the extension of the Canada Emergency Wage Subsidy, the last four periods will require the renter to have a revenue decline of over 10% in order to be eligible. If this requirement is not met, the business will not be eligible for the CERS or Lockdown Support.
*Expenses for each qualifying period are capped at $75,000 per location and are subject to an overall cap of $300,000 that is shared among affiliated entities.
CERS Calculations for Periods 17 to 21
Relevant Periods for Calculating Revenues
- Period 17 - June 6 to July 3
- Period 18 - July 4 to July 31
- Period 19 - August 1 to August 28
- Period 20 - August 29 to September 25
- Period 21 - September 26 to October 23
|
|
Period 17 |
Period 18 |
Period 19 |
Period 20 |
Period 21 |
| Revenue decline: | |||||
|
70% and over |
65% | 60% | 40% | 40% | 20% |
| 50-69% | 40% + (revenue decline - 50%) x 1.25 (e.g., 40% + (60% revenue decline - 50%) x 1.25 = 52.5% subsidy rate) | 35% + (revenue decline - 50%) x 1.25 (e.g., 35% + (60% revenue decline - 50%) x 1.25 = 47.5% subsidy rate) | 25% + (revenue decline - 50%) x 0.75 (e.g., 25% + (60% revenue decline - 50%) x 0.75 = 32.5% subsidy rate) |
25% + (revenue decline - 50%) x 0.75 (e.g., 25% + (60% revenue decline - 50%) x 0.75 = 32.5% subsidy rate) | 10% + (revenue decline - 50%) x 0.5 (e.g., 10% + (60% revenue decline - 50%) x 0.5 = 15% subsidy rate) |
| >10-50% | Revenue decline x 0.8 (e.g., 30% revenue decline x 0.8 = 24% subsidy rate) | (Revenue decline - 10%) x 0.875 (e.g., (30% revenue decline - 10) x 0.875 = 17.5% subsidy rate) |
(Revenue decline - 10%) x 0.625 (e.g., (30% revenue decline - 10) x 0.625 = 12.5% subsidy rate) |
(Revenue decline - 10%) x 0.625 (e.g., (30% revenue decline - 10) x 0.625 = 12.5% subsidy rate) |
(Revenue decline - 10%) x 0.25 (e.g., (30% revenue decline - 10) x 0.25 = 5% subsidy rate) |
| 0-10% |
Revenue decline x 0.8 (e.g., 5% revenue decline x 0.8 = 4% subsidy rate) |
0% | 0% | 0% | 0% |
This article has been published for general information. You should always contact your trusted advisor for specific guidance pertaining to your individual tax needs. This publication is not a substitute for obtaining personalized advice.
