Originally, this subsidy was for amounts paid or payable to an arm’s-length party. However, there have since been changes.
On February 24, 2021, the Government announced a proposed to make lockdown support available to an eligible property owner whose tenant is not at arm’s length but uses the qualifying property that is subject to a lockdown.
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This proposal would amend the rules in the Income Tax Act so that the Lockdown Support would be available in situations where activities of a party that does not deal at arm’s length with the entity applying for the Lockdown Support, and that rents the property from the entity, are required to cease as a result of a “public health restriction,” provided the other conditions for the Lockdown Support are met. The proposed amendment would apply as of September 27, 2020.
A scenario I come across is the owner/manager/director/employee of a CCPC uses a room in their personal residence exclusively for business purposes - home office (they may meet clients there/have meetings/etc.). Typically a small amount is paid to the owner/manager by the corp for the use of the room (based on the business proration of actual expenses). Would this rent paid be eligible for the subsidy?