Bill C-14, which implements some of the measures announced in the 2020 Fall Economic Update, received its third reading on April 15, 2021. This bill provides claimants access to the Canada Emergency Rent Subsidy (CERS) prior to the payment of certain eligible expenses, as well as additional temporary support for families entitled to the Canada Child Benefit. These measures received first reading in the House of Commons on December 2, 2020.

The corporate income tax measures included in Bill C-14 are considered substantively enacted for IFRS and Accounting Standards for Private Enterprise (ASPE) purposes on April 15, 2021, the date Bill C-14 received third reading (as Canada has a minority government). The corporate income tax measures in Bill C-14 will be considered enacted for U.S. GAAP purposes on the date the bill receives Royal Assent.

In addition, the regulations for the CEWS and CERS extension for periods 14 to 16 (i.e. March 14, 2021 to June 5, 2021) were published in the Gazette on April 14, 2021 and are now law.

Corporate measures included in Bill C-14

CERS

Bill C-14 includes a rule that deems an eligible entity to have paid the eligible expense on the date it first became due, as long as the eligible entity attests that it intends to (and does) pay the amount within 60 days of receiving the subsidy. The new deeming rule provides relief for CERS claimants who would otherwise have had to pay an amount within a particular qualifying period for the amount to be considered an eligible expense on which they could claim the subsidy (see TaxNewsNow "New legislation provides CERS timing clarity & Child Benefit boost").

CEWS and CERS extension (periods 14-16)

Finance enacted regulations required to extend the CEWS, CERS and Lockdown Support Subsidy for eligible businesses until June 5, 2021. These latest amendments to the income tax regulations prescribe three additional four-week periods, where eligible organizations can receive continued support through the CEWS and CERS (including the Lockdown Support Subsidy) from March 14, 2021 to June 5, 2021 (i.e., periods 14 to 16). The top-up, base rates and the prescribed amounts for furloughed employees available under the CEWS remains the same as periods 11 to 13 (i.e., December 20, 2020 to March 13, 2021). Similarly, the CERS and Lockdown Support Subsidy rate structures that applied for periods 11 to 13 will also apply for periods 14 to 16. Finance previously announced that it would extend these programs to June 5, 2021 on March 3, 2021 (see TaxNewsFlash-Canada 2021-06, Canada to Maintain Rent and Wage Subsidy Levels to June 2021).

For more information, contact your KPMG advisor.

Information is current to April 26, 2021. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500