New Canada Emergency Commercial Rent Subsidy (CERS)
Applications are now open through the Canada Revenue Agency for CERS, which has replaced the previous Canada Emergency Commercial Rent Assistance program.
The new CERS program provides up to 65% rent support to eligible charities, businesses and non-profit organizations that have experienced a drop in revenue, as a result of COVID-19. Organizations experiencing a drop in revenue of 70% or higher, may be eligible for a 65% subsidy, while organizations that have seen declines below 70% will be eligible for subsidies in varying amounts based on a formula. Eligible expenses are capped at $75,000 per location to an overall cap of $300,000.
The Canadian government will also provide an additional 25% subsidy, referred to as the “Lockdown Support” to eligible businesses that are required to close or restrict their business under a national, provincial or municipal public health order. Eligible expenses are capped at $75,000 per location with no overall cap.
|Revenue Decline||Base subsidy rate||Lockdown Support|
|70% and over||65%||25%|
|50% to 69%||40% + (revenue drop – 50%) x 1.25
(e.g., 40% + (60% revenue drop – 50%) x 1.25 = 52.5% subsidy rate)
|1% to 49%||Revenue drop x 0.8
(e.g., 25% revenue drop x 0.8 = 20% subsidy rate)
The claim periods currently set for CERS are as follows:
- Period 8: September 27, 2020 – October 24, 2020;
- Period 9: October 25, 2020 – November 21, 2020; and
- Period 10: November 22, 2020 to December 19, 2020.
Eligible expenses for a qualifying period (those related to real property in Canada and paid under written agreements entered into before October 9, 2020) include the following:
- Commercial rent;
- Property taxes (including school taxes and municipal taxes);
- Property insurance; and
- Interest on commercial mortgages for a qualifying property, less any subleasing revenues.
Unlike under the Canada Emergency Commercial Rent Assistance program where commercial landlords were required to apply for assistance on behalf of their tenants, under the CERS program, tenants may apply for assistance directly.