Additional information on the program as a whole, and the 1-month extension, was updated on the CECRA website. It includes:
July extension
CECRA for small business has been extended through the end of July 2020.
Only those tenants approved in the April, May and June application are eligible for the July extension.
If a business had an average revenue decline of 70% or more in April, May and June, they are deemed eligible for the additional month of rent relief. However, not all tenants in the original application need to be included for the July extension.
The requirement to claw-back insurance proceeds and provincial rent supports from the CECRA for small businesses forgivable loan amount for both existing and new applicants has been removed. Existing applicants who are affected will be notified and will have any previously clawed-back amounts restored to their forgivable loan.
Calculating the 70% reduction in revenues
There are 2 scenarios by which to calculate the 70% reduction in revenues:
If your small business was operating during April – June 2019, then compare your gross revenues from April, May and June of 2020 to your revenues of April, May and June of 2019.
If your small business was not operating during April – June 2019, then compare your average gross revenues from April, May and June of 2020 to your average gross revenues for January and February 2020.
NOTE: Your revenue must consist of revenue earned from ordinary activities in Canada. Calculate your revenue using your normal accounting method and exclude revenues from non-recurring items.
For registered charities and non-profit organizations, the calculation would include most forms of revenue, excluding revenues from non-arm’s length persons.
Your June forecast must be supportable by the variables at play for your business. The result is to be guided by the average revenue reduction for April and May and the forecasted change given your respective province or territory’s guiding principles for reopening the economy (i.e. where the impacted business falls in the staged approach).
For the 1-month July extension:
Those who qualified for CECRA for small businesses based on existing program parameters will be able to apply for the additional 1 month based on having a 70% revenue decline for April, May and June (for example, without reassessing whether they continue to have a 70% revenue decline in July). Participation in the one-month extension is voluntary. Both existing applicants to CECRA for small businesses and new applicants are able to apply for the July rent reduction.
Have sales taxes been applied to my loan and/or rental agreements?
No, your forgivable loan amount is exempt from sales taxes (GST and HST).
NOTE: Sales taxes (GST and HST) are excluded from determining the gross rent amount. The monthly rent amounts are before applicable sales taxes.
Do I have an obligation to collect GST/HST from CMHC on the payments received from CMHC under the CECRA for small businesses program?
No, as a commercial property owner, you aren’t required to collect GST/HST with respect to payments that you have received from CMHC under the CECRA for small businesses program.
If you have any further questions on the application of GST/HST to the CECRA program, please contact the Canada Revenue Agency, GST/HST Technical Enquiries line at 1-800-959-8287.
I have impacted tenants whose leases are expiring before August 31, 2020, can I still apply for them?
Yes, you can still apply for them, provided that:
you and your tenant(s) are each committed and will remain committed to the month to month tenancy pursuant to the terms of the lease beyond August 31, 2020
the tenant has committed to entering into a new lease to continue to operate its business (tenant must provide the program administrator with a copy of the signed lease)
Can I submit multiple applications?
Yes, a property owner can submit multiple applications, provided that each application is for a different property.
For clarity, you can only apply for the program once per property. As a property owner, you must therefore ensure that you have included all eligible tenants in the respective application, prior to submitting your application.
Do I have to use the sample form of Rent Reduction Agreement?
No, you don’t have to use the rent reduction agreement provided — but as the property owner of an impacted tenant, it’s your responsibility to ensure that:
a rent reduction agreement is in place with any impacted tenant participating in the CECRA Program
the rent reduction agreement meets the CECRA Program requirements and the legal requirements of your jurisdiction
that any legal advice that it considers necessary has been obtained
How do you define commercial real property?
We define commercial real property as a commercial property with small business tenants.
Commercial properties with a residential component and multi-unit residential mixed-use properties would equally be eligible with respect to their small business tenants.