Would a travel agency that was required to close its office due to COVID lockdown measures, so that its employees started working from home, qualify for lockdown support under B of s. 125.7(2.1) and the definition of “rent top-up percentage”?
Regarding the test in para. (f) of the “public health restriction” definition, and the test of whether “restricted activities” at the office had ceased, CRA stated:
[I]n the case of a travel agency, if, prior to the closure, clients made in-person visits to the office to arrange travel bookings and in-person visits ceased upon closure of the office as a result of an order or decision, then those activities could be considered restricted activities and this condition could be satisfied. The fact that employees started working from home and started making travel bookings over-the-phone once the office closed would not preclude this condition from being met.
Regarding the 25% test in para. (g), CRA stated:
[T]here is not enough information to conclude that the requirement set out in paragraph (g) is satisfied. However, if, during the relevant prior reference period, all activities were performed in-person at the travel agency, then it may be reasonable to conclude that at least approximately 25% of its qualifying revenues in the prior reference period, that were earned from the qualifying property, were derived from the restricted activities.