Extend CEWS and CERS to June 2021

Summary#

These are the final rules called Regulations Amending the Income Tax Regulations (COVID-19 — Wage and Rent Subsidies Periods 14 to 16). They add three new four‑week subsidy periods for the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Rent Subsidy (CERS), effective March 14, 2021.

What it does#

• Adds three qualifying periods:
  • Period 14: March 14, 2021 to April 10, 2021
  • Period 15: April 11, 2021 to May 8, 2021
  • Period 16: May 9, 2021 to June 5, 2021
• Sets the months to use when comparing revenues for each period:
  • Period 14 — current: March 2021; prior: March 2019
  • Period 15 — current: April 2021; prior: April 2019
  • Period 16 — current: May 2021; prior: May 2019
• Keeps CEWS subsidy rates the same for these periods:
  • base rate 40% and top‑up rate 35%, for a possible total of up to 75% of eligible remuneration for active employees.
• Keeps the CEWS amount for furloughed employees equal to the greater of:
  • $500, and
  • the lesser of 55% of baseline pay and $595.
• Keeps CERS rate structure the same:
  • maximum base rent subsidy 65%, and Lockdown Support up to 25% of qualifying rent expenses.
• States these regulations came into force on March 14, 2021.

Who's affected#

• Employers and organizations that qualify for the CEWS or CERS, including businesses, charities and non‑profits.
• Employees of those employers. In particular:
  • active employees on payroll (who may get a subsidy through their employer), and
  • furloughed employees (who are covered by the CEWS furlough amount).
• Small businesses that choose to apply for these subsidies.
• The Canada Revenue Agency as the program administrator.
• It may indirectly affect the Employment Insurance (EI) system, since some furlough support is aligned with EI rules.

Why it matters#

• It continues government wage and rent support for businesses through the spring of 2021. That can help employers keep paying or rehiring staff and cover rent when revenues are down.
• The rules set which months are used to measure revenue drops. That affects how much support an eligible employer can claim.
• The government estimated the cost as $13.9 billion for the CEWS and $2.1 billion for the CERS for March 14 to June 5, 2021.
• For workers, the measures aim to preserve jobs and ease pressure on EI by keeping employer‑employee ties during the pandemic recovery.