Posted on June 17th, 2021 in Domestic Tax

EXTENDED WAGE AND RENT SUBSIDIES: Details Released

the word Support spelled out in scrabble tiles

On March 3, 2021, the Department of Finance announced details on the Canada Emergency Wage Subsidy (CEWS) and Canada Emergency Rent Subsidy (CERS) for the March 14 – June 5 periods. Later, the Federal Budget (April 19, 2021) announced an extension of these programs to September 25, 2021.

Revenue comparison reference periods

The reference periods will continue to use either of the two months ended prior to the end of the relevant period (so February or March, 2021, for CEWS period 14/CERS period 7). However, the prior reference month to be used when comparing average monthly revenues from March onwards would be changed. Rather than comparing to the same month in 2020, the same month from 2019 would be used. For example, March 2021, revenues would be compared to March 2019, revenues rather than March 2020, revenues.

Rates

For the periods between March 14 and July 3, 2021, the maximum CEWS subsidy rate is 75%, while the maximum CERS rate is 65%. Subsequently, the maximum rates for both CEWS and CERS will be the same, and decline gradually: 60% (July 4 – July 31), 40% (August 1 – August 28), and 20% (August 29 – September 25). The additional lockdown support to CERS will remain at 25% for the entire period (March 14 – September 25).

Deadlines

Both CERS and CEWS applications are due 180 days after the end of the qualifying period.

The chart below summarizes the upcoming deadlines for the various periods currently announced.

CEWS/
CERS
Period
Period dateDeadline for
application
9/2Oct. 25 to Nov. 21, 2020May 20, 2021
10/3Nov. 22 to Dec. 19, 2020Jun. 17, 2021
11/4Dec. 20, 2020 to Jan. 16, 2021Jul. 15, 2021
12/5Jan. 17 to Feb. 13, 2021Aug. 12, 2021
13/6Feb. 14 to Mar. 13, 2021Sep. 9, 2021
14/7Mar. 14, 2021 to Apr. 10, 2021Oct. 7, 2021
15/8Apr. 11, 2021 to May 8, 2021Nov. 4, 2021
16/9May 9, 2021 to Jun. 5, 2021Dec. 2, 2021
17/10Jun. 6, 2021 to Jul. 3, 2021Dec. 30, 2021
18/11Jul. 4, 2021 to Jul. 31, 2021Jan. 27, 2022
19/12Aug. 1, 2021 to Aug. 28, 2021Feb. 24, 2022
20/13Aug. 29, 2021 to Sep. 25, 2021Mar. 24, 2022

CRA has recently advised that they may accept a late-filed application in exceptional circumstances. Requests must be made before the later of May 21, 2021, and 30 days after the filing deadline.

ACTION ITEM: Ensure to consider whether a claim should be made well before the deadline for application.

Article originally published in: Tax Tips & Traps 2021 Second Quarter – Issue 134