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Canada Emergency Rent Subsidy (CERS) Breakdown and Example — ConnectCPA


Lockdown top-up

You may also qualify for ‘lockdown top-up’ support amount for locations affected by public health restrictions. This amount is added to your subsidy rate. The calculation is as follows:

25% x # of days lockdown / # of days in CERS period

For example:  A store was locked down for 14 days due to a government shutdown order. The lockdown top-up is 25% x 14 days / 28 days = 12.5%

EXAMPLE USING JANUARY AND FEBRUARY 2020 AVERAGE REVENUE BASELINE

ABC Inc. earned a revenue of $100,000 in September 2020 and $110,000 in October 2020 and had an eligible rent expense of $2,000 each month. The company had an average revenue of $210,000 for January - February 2020. Therefore, ABC Inc. saw a revenue decline of 52.38% and 47.62% in September and October. Since the 52.38% drop is higher, this rate will be used as the subsidy rate

Since the revenue drop is between 50% - 70%, the subsidy rate is as follows:

(52.38% - 50%) x 1.25 + 40% = 42.98%

During this time, ABC Inc. was forced to shut down its location for a full period (28 days) due to a government-imposed shutdown. Therefore, ABC Inc. is eligible for lockdown top-up as follows:

25% x 28 days / 28 total days = 25%

The total rent subsidy ABC Inc. is entitled to for the period is $1,233.87, which is made up of $780.11 (rent subsidy) and $453.76 (lockdown support).  The numbers above use the $2,000 per month rent amount, pro-rated for 28 days that spans September 2020 and October 2020.


HOW TO APPLY?

You can apply by logging into the following Canada Revenue Agency (CRA) services:

  1. My Business Account OR;

  2. Represent a Client (i.e. through an authorized third-party - usually an accountant)

Prior to submitting a CERS application, you must complete and sign an RC665 - Canada Emergency Rent Subsidy Attestation.

You must also ensure that you register for a CRA CERS number. The registration can be done under the ‘Other services’ section upon logging into the ‘My Business Account’.