CERS & CEWS: What Business Owners Need to Know
The COVID-19 pandemic has had a major impact on Canadian business owners. Most importantly, we hope that you and your loved ones are staying healthy and safe through this challenging time. We are here to help answer any difficult business or tax related questions that may come up. Provincial lockdowns, emergency orders, and numerous restrictions, have created many challenges for Canadian businesses and employers. The federal government has offered some relief, however filing and reporting can be difficult and onerous.
To help you make sense of it all, we have outlined two of the most important COVID-19 business relief programs below. We may also be able to help you with filing and reporting. If you have any questions, please feel free to give us a call.
Canada Emergency Rent Subsidy (CERS)
CERS is a federal program designed to help Canadian businesses, non-profit organizations, or charities who have seen a drop in revenue due to the COVID-19 pandemic. This subsidy may be able to help you cover part of your commercial rent or property expenses and covers both renters and property owners. The subsidy went into effect September 27, 2020 and will continue until at least June of 2021.
You may be eligible if your monthly revenue declined during this time period as compared to the previous year. There are several criteria that you must meet in order to be eligible for the program. The most important is:
- That you had a CRA business number as of Sept. 27, 2020
You must also:
- Qualify as an eligible business, charity, or non-profit
- Have experienced a drop in revenue
- Have eligible expenses
Note that there is no minimum revenue drop to apply for this program, however the amount of decline will be used to calculate the amount of subsidy you receive. If you have any questions about eligibility, you can visit the Canadian Revenue Agency’s (CRA) website.
CERS covers a portion of eligible expenses as calculated on a property-by-property basis. Qualifying properties include buildings or land in Canada that:
- Your business owns or rents, and
- That you use in the course of your ordinary business activities
Eligible expenses can be claimed up to a maximum of $75,000 per location and a total of $300,000 for all locations. Restrictions do apply in terms of residences, rental incomes, and non-arms length entities. For more information on eligible expenses, click here.
In order to apply for the CERS program you must:
- Have a “My Business Account” with the CRA
- Create a CERS (ZA) number
- Set up direct deposit
For more information on how to complete the above requirements and apply for the CERS program or for help applying give us a call.
Canada Emergency Wage Subsidy (CEWS)
CEWS is designed to help Canadian employers who have seen a drop in revenue due to COVID-19. It aims to help employerscover a portion of employee wages, prevent job loss, and re-hire workers. The program can be applied forretroactively to March 15, 2020. However, there have been several changes to the CEWS program as of January 6, 2021. For detailed information on the changes and current subsidy rates visit the CRA website.
In order to be eligible for CEWS you must meet the following criteria:
- You had a CRA payroll account on March 15, 2020
- You qualify as one of the accepted types of employers
- You have experienced a drop in revenue
For a full break down on eligibility criteria, including a list of eligible employer types, eligible revenue, and special revenue circumstances click here.
Please note that there are multiple claim periods. For additional information on current and upcoming claim periods click here. Each claim period has a specific deadline for applications and the subsidy does not renew automatically. You must confirm eligibility and reapply for each claim period, and you must apply separately for each (RP) payroll account that you have.
There are also restrictions and guidelines on which employees are eligible and how much of their remuneration can be covered, in some cases these regulations differ depending on the claim period that you are applying for, so be sure to review claim periods and regulations closely.
In order to apply for the CEWS program, you must:
- Choose the correct claim period
- Calculate the subsidy amount for your business
- Set up direct deposit
Note that there is no minimum revenue drop to apply for this program, however the amount of decline will be used to calculate the amount of subsidy you receive. If you have any questions about eligibility, you can visit the Canadian Revenue Agency’s (CRA) website.
CERS covers a portion of eligible expenses as calculated on a property-by-property basis. Qualifying properties include buildings or land in Canada that:
- Your business owns or rents, and
- That you use in the course of your ordinary business activities
Eligible expenses can be claimed up to a maximum of $75,000 per location and a total of $300,000 for all locations. Restrictions do apply in terms of residences, rental incomes, and non-arms length entities. For more information on eligible expenses, click here.
In order to apply for the CERS program you must:
- Have a “My Business Account” with the CRA
- Create a CERS (ZA) number
- Set up direct deposit
You can then apply by signing in to your My Business Account with the CRA or use the Web Forms application using your web access code (WAC). For a detailed application guide you can visit the CRA’s website or for help applying give us a call.
As always, the health and well being of our clients and their businesses is our number one priority. If you have any questions at all about the Government of Canada’s COVID-19 response or how it might affect your business, please don’t hesitate to reach out.