Canada Emergency Rent Subsidy
The government announced a new Canada Emergency Rent Subsidy, which would provide rent and mortgage support until June 2021 for qualifying organizations affected by COVID-19. The rent subsidy would be provided to tenants directly, while also providing support to property owners. This new subsidy would support businesses, charities, and non-profits whom have suffered a revenue drop, by subsidizing a percentage of their expenses, on a sliding scale, up to a maximum of 65 per cent of eligible expenses until December 19, 2020. Organizations would be able to make claims retroactively for the period that began September 27 and ends October 24, 2020.
A top-up Canada Emergency Rent Subsidy of 25 per cent for organizations temporarily shut down by a mandatory public health order issued by a qualifying public health authority, in addition to the 65 per cent subsidy. This follows a commitment in the Speech from the Throne to provide direct financial support to businesses temporarily shut down as a result of a local public health decision.
Canada Emergency Wage Subsidy
The government of Canada has extended the wage subsidy up to June 2021. The current maximum based subsidy of 40% and the top up of 25% would remain the same up to December 19, 2020.
However, to ensure that the top-up subsidy is reflective of the changes in revenue the revenue decline test is being updated. Instead of the current 3-month test the base and top-up will be based on the change in an eligible employer's monthly revenues, year-over-year, for either the current or previous calendar month. This means an employer with a 70 per cent or greater revenue loss in a period would be eligible for a 65 per cent wage subsidy. At the same time, from September 27, 2020 to December 19, 2020 the “safe harbour” rule will entitle an eligible employer to be able to receive the same amount of top-up as they would have received under the previous test.
From October 25 onwards the subsidy for employees who were given unpaid leave of absence would be aligned with the EI benefits to ensure that there is support for Canadian workers. This means the subsidy per week would be: the amount of eligible remuneration paid in the week; or, if the employee receives remuneration of $500 or more in the week, the greater of $500 and 55 per cent of pre-crisis remuneration for the employee, up to a maximum subsidy amount of $573.
Canada Emergency Business Account
There is now an additional interest-free loan of up to $20,000 for businesses and not-for-profits who are still impacted by the pandemic. Totaling to a maximum $60,000. In addition, half of this financing would be forgivable if it is repaid by December 31, 2022. The application deadline for this loan has been extended to December 31,2020 and will include an attestation of the impact of COVID-19 on the business will be required to access the additional financing. Additional details will be announced in a few days.