Commercial rent forgiveness tax incentive: A measure that may benefit you.

You may qualify for a tax credit of 50% of the November 2020 rent that you forgave in all or part in 2021 to a tenant that has been severely impacted by the Covid-19 crisis.

The tax credit is determined as follows:

• If the tenant has less than 250 employees, the basis of the credit for rent forgiveness is the full amount of the rent forgiven in 2021.

• If the tenant has at least 250 employees, the basis of the credit for rent forgiveness is two third of the amount of the rent forgiven in 2021.

You must exclude from your taxable rental income the amount of the rent forgiven.

The tenant must meet certain requirements:

• It must employee fewer than 5,000 workers;

• It must have been forced to close in November 2020 due to government measures or it must be one of the industries listed in Secteur S1. That list includes hospitality, restaurant, carsharing, cinema.

• It shouldn’t be, except if the tenant is a micro or small and medium sized enterprise, in bankruptcy proceedings as of December 31, 2020, or in liquidation.