The Canada Revenue Agency (CRA) is now accepting applications for the Tourism and Hospitality Recovery Program (THRP) wage and rent subsidies.
“We were very pleased to see the government act so quickly to put this in place so that agencies can apply for wage and rent subsidies now,” said Wendy Paradis, president of the Association of Canadian Travel Agencies (ACTA), in a release on Tuesday (Dec. 21).
The THRP gives up to 75 per cent wage and rent subsidies to eligible travel, tourism, and hospitality businesses who suffered more than 40 per cent in revenue losses.
If more than 50 per cent of your business revenue comes from the following activities, your business is considered a tourism business under the THRP:
- Operating a travel agency or as a tour operator
- Acting as an agent in selling travel, tour, and accommodation services for:
- tour operators
- transportation companies
- short-term lodging establishments
- Arranging, assembling and marketing tours
There are two minimum financial requirements to be eligible for the THRP:
- You have a 12-month average revenue drop from March 2020 to February 2021 of at least 40 per cent. This is calculated against the same month in the year prior (e.g., September 2019 vs. September 2020). The total number is calculated based on the CEWS claim periods 1 – 13, excluding the revenue drop for either period 10 or 11. The government provides a tool to calculate this number.
- In the period for which you are applying for the THRP, you must have a revenue drop of 40% or greater compared to the same period prior to the pandemic. More details are available here. If in one period of the program your revenue drop is less than 40 per cent, you do not qualify for the THRP in that period, but you may qualify in other periods in which you suffer a 40%+ loss.
Are independent travel agents eligible for the THRP?
Some independent travel agents are eligible for the wage subsidy component of the THRP if they had a payroll account on March 15, 2020 and meet the revenue loss requirements previously described, ACTA said.
This means that as of March 15, 2020, you were paying EI and CPP directly to the government every month under your payroll remittance.
Independent travel agents qualify for the rent subsidy component of the THRP if they meet the revenue loss requirements previously described. However, a home office does not qualify as an eligible expense. More information on eligible expenses are available here.
Support for ITAs
ACTA is "vigorously advocating" for new financial supports to independent travel agents left out of this program.
“We are continuing to meet with politicians and senior government officials in the Ministry of Finance, Ministry of Tourism, and other key MPs to strongly urge for immediate support to all independent travel agents,” said Paradis.
Meanwhile, the Association of Canadian Independent Travel Advisors (ACITA), in collaboration with Randy Boissonnault, Minister of Tourism and Associate Minister of Finance, has launched an urgent survey that aims to gather data from roughly 12,000 independent travel advisors in Canada with regards to lost revenues.
“It's our hope that the data collected will help the decision makers see how devastated our sector of the travel industry is and speed up the process of providing aid to independent travel advisors," the survey reads.
How much support can agencies get?
The Tourism and Hospitality Recovery Program will provide up to 75 per cent wage and rent subsidies to travel agencies with a revenue loss of over 40% between October 24, 2021, and March 12, 2022.
The subsidy amount will drop in half between March 13, 2022 and May 7, 2022.
For businesses with a current-month revenue decline of 40-74 per cent, the benefit will match their revenue decline. For example, if the current-month revenue decline is 60 per cent, the subsidy rate will be 60 per cent.
The benefit is capped at 75 per cent, so travel agencies with a current-month revenue decline of > 75% will receive a 75% subsidy.
When are the THRP periods?
Currently agencies can apply for Period 22, which is backdated from October 24, 2021 – November 20, 2021. Starting January 5, 2022, they can apply for Period 23, which is between November 21, 2021 – December 18, 2021.
Periods close to applications 180 days after the end of the claim period.
The CRA has an eligibility tool to help determine if you can access the THRP. Agencies can call the CRA for questions related to the THRP at 1-800-959-5525.