Corporate Tax Credits

• Manitoba Manufacturing Investment Tax Credit
  
• Manitoba Film and Video Production Tax Credit
  
• Interactive Digital Media Credit
  
• Book Publishing Tax Credit
• Cultural Industries Printing Tax Credit
  
• Data Processing Investment Tax Credit
• Odour Control Tax Credit
  
• Nutrient Management Tax Credit
• Manitoba Research and Development Tax Credit
  • Educational Institutions Potentially Eligible for Participation in SR&ED Refundable Manitoba R&D Tax Credit Program (pdf - 15kb)
    
• Federal Scientific Research and Experimental Development (SR&ED) Tax Incentives Program
  
• Co-operative Development Tax Credit
• Co-op Education and Apprenticeship Tax Credits
• Neighbourhoods Alive! Tax Credit
• Small Business Venture Capital Tax Credit - (formerly the Community Enterprise Investment Tax Credit)

Manitoba Manufacturing Investment Tax Credit

Manitoba has a Manufacturing Investment Tax Credit. This program targets manufacturing plant and equipment purchased for first-time use in manufacturing or processing in Manitoba. Qualified investments must have been made after March 11, 1992 and before January 1, 2015. Corporations earn a 10% tax credit (7/10 refundable and 3/10 non-refundable) which can be applied against Manitoba corporate income tax payable in the year earned, with unused credits available for a ten-year carry-forward and a three-year carry-back (to taxation years ending after March 11, 1992 or after April 22, 2003 for class 43.1 property). This program is administered by Canada Revenue Agency on behalf of Manitoba.

The Manufacturing Investment Tax Credit includes equipment under class 43.1 purchased between April 22, 2003 and December 31, 2014. Class 43.1 includes (for a firm's own consumption) equipment used to produce energy from renewable sources and equipment that uses energy more efficiently. Class 43.2 Assets also qualify for the credit.

An income tax election allowing taxpayers to renounce, in whole or in part, the Manufacturing Investment Tax Credit is provided.

For more information on the Manufacturing Investment Tax Credit, contact Taxation, Economic and Intergovernmental Fiscal Research Division, Manitoba Department of Finance.

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Manitoba Film and Video Production Tax Credit

The Manitoba Film and Video Production Tax Credit, introduced in 1997, which was set to expire March 1, 2011, has been extended to March 1, 2014, and production companies may now elect to claim a new tax credit based on a wider range of production costs incurred and paid.

Since 1997, a refundable tax credit for film and video productions has been available, based on eligible salaries paid to Manitoba residents and qualifying non-resident employees ("deemed residents") for work performed on an eligible film or video produced in Manitoba. When the program began, the rate of the credit was 35%; since March 9, 2005, the basic rate of the credit has been 45%.

Salary associated with a deemed resident who trains two or more Manitoba residents cannot exceed 30% of eligible salaries paid to Manitoba residents; or 10% if only one Manitoba resident is trained.

A 5% Manitoba producer bonus applies based on eligible salaries where a Manitoba resident receives credit as a producer on an eligible film.

A frequent filming incentive is also provided. A corporation that produces three eligible films in two years earns the additional credit on eligible salaries paid with respect to the third qualifying production. For productions commencing principal photography before January 1, 2008, the frequent film bonus is 5% and the percentage of eligible salaries associated with deemed residents is 20%. For productions commencing principal photography on or after that date, the frequent film bonus is 10% and the percentage of eligible salaries associated with deemed residents is 30%.

A 5% rural and northern incentive is provided based on eligible salaries paid for work performed in Manitoba on productions where a permanent establishment of the applicant corporation is located, and 50% of principal photography days took place, at least 35km from Winnipeg.

With the Manitoba producer bonus, the frequent filming incentive, and the rural and northern incentive, a film that meets all program criteria may now earn a maximum 65% credit on eligible salaries.

Starting with productions that commence principal photography after March 2010, production companies are able to elect to claim either the film tax credit based on up to 65% of eligible labour costs (described above), or a new 30% tax credit based on production costs incurred and paid, for labour, goods, and services provided in Manitoba that are directly attributable to the production of an eligible film. It was announced in Budget 2012 that, with respect to film or video productions started after April 17, 2012, such production costs can also include accommodation costs incurred and paid up to $250 per night per unit, exclusive of taxes, as eligible tangible property expenditures.

The following changes are also effective as of March 24, 2010:

• production companies may file Form T2029, Waiver in Respect of the Normal Reassessment Period, to extend their application deadline by 18 months;
• federal limitation periods are adopted for filing a Manitoba film tax credit certificate with the Canada Revenue Agency.
  

For more information on the Film and Video Production Tax Credit contact:

Manitoba Film & Music
#410 - 93 Lombard Avenue
Winnipeg MB R3B 3B1

Telephone:  (204) 947-2040
Fax:  (204) 956-5261

Email: explore@mbfilmmusic.mb.ca

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Interactive Digital Media Tax Credit

This refundable corporation income tax credit is for companies that develop and produce interactive digital media projects in Manitoba. The tax credit is equal to 40% of the remuneration paid to Manitobans on eligible projects approved by the Department of Innovation, Energy and Mines. The maximum tax credit on an eligible project is $500,000.

Projects that begin prototyping and product development after April 9, 2008 and before 2014 can qualify for the credit.  A qualifying company must be a taxable Canadian corporation with a permanent establishment in Manitoba. The tax credit is processed as part of a qualifying company’s annual income tax return and administered by the Canada Revenue Agency.

The following changes are effective for certificates of eligibility and tax credit certificates issued after March 23, 2010:

• tax credit certificates can be issued on a taxation-year basis instead of at the end of a project;
• repaid or repayable government assistance no longer reduces eligible labour costs; and
• where a government or public authority is the purchaser of an interactive digital media product, the amount paid by the purchaser and the amount of the interactive Digital Media Tax Credit cannot exceed 100% of the project's costs.

For more information on the Interactive Digital Media Tax Credit contact:

Science, Innovation and Business Development Division
Manitoba Innovation, Energy and Mines
1030-259 Portage Avenue
Winnipeg, MB R3B 3P4

Telephone: 204-945-0975
Fax: 204-945-3977
Email: avery.jodoin@gov.mb.ca

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Book Publishing Tax Credit

To assist the development of the book publishing industry in Manitoba, the refundable Book Publishing Tax Credit was introduced in 2008, equal to 40% of eligible Manitoba labour costs. Eligible labour costs include non-refundable author advances; and remuneration for activities carried out in Manitoba, including: salaries for editing, design and project management; fees to freelancers for editing, design and research; artwork; development of prototype; and set-up and typesetting. The maximum tax credit claimable by a publisher is $100,000 per year.

An eligible publisher must be engaged primarily in the business of publishing books, must have a permanent establishment or be resident in Manitoba, must pay at least 25% of its wages and salaries to employees who are Manitoba residents, and must have recently published at least two qualifying books.

A qualifying book is a new, non-periodical publication that is Canadian-authored and is categorized as fiction, non-fiction, poetry, biography or children’s. A book eligible for a Book Publishing Tax Credit must be a qualifying book which is published before 2015.

Eligible labour costs must be incurred and paid in Manitoba by the publisher after April 9, 2008 and before 2015.

To promote environmental sustainability in this industry, an additional bonus equal to 10% of the Manitoba printing costs can be earned by the publisher if an eligible book is printed on paper with a minimum of 30% recycled content. Budget 2011 increased the rate of this bonus from 10% to 15% for eligible printing expenses incurred and paid after April 12, 2011. Eligible printing costs must be incurred and paid in the year of publication of the eligible book or in the immediately following year

This income tax credit is administered by the Canada Revenue Agency on behalf of Manitoba. .

For more information on the Book Publishing Tax Credit contact:

Arts Branch
Culture, Heritage and Recreation Programs
Manitoba Culture, Heritage and Tourism
Telephone: 204-945-7581
Fax: 204-948-1684

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Cultural Industries Printing Tax Credit

Manitoba printers are eligible for a 15% refundable Cultural Industries Printing Tax Credit on eligible printing costs, incurred on or after April 13, 2011, in the production of eligible books.

Qualifying costs are amounts invoiced by the Manitoba printer to the publisher of a book for printing, assembly and binding services, performed in Manitoba on a hardcover or paperback Canadian-authored non-periodical publication categorized as fiction, non-fiction, poetry, drama, biography, or children’s book.

The publisher of the eligible book may be carrying on business anywhere in Canada but must not be related to the Manitoba printer.

A worksheet which will assist a printer in determining the eligibility of a book is available.

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Data Processing Investment Tax Credit

Budget 2012 has announced a refundable corporation income tax credit available to corporations with a permanent establishment in Manitoba whose primary business activity, including the activities of its affiliates, is data processing.

The refundable tax credit will be on the capital cost of new, qualified property purchased or leased after April 17, 2012 and available for use by an eligible company in its data processing centre in Manitoba before 2016. Property purchased or leased to replace or improve property that previously qualified for the tax credit will also be eligible. The credit equals:

• 4% on the capital cost of new, qualified property that is a building, and
• 7% on the capital cost of new, qualified property that is machinery or equipment.

The purpose of the credit is to position Manitoba as a location for investment in high-technology data processing.

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Odour Control Tax Credit

Effective April 20, 2004, the Odour Control Tax Credit was established. It is a 10% nonrefundable corporation income tax credit for businesses that invest in capital to control nuisance odours that arise or may arise from the use or production of organic waste.  Eligible expenditures include acquired capital property that significantly prevents, reduces, or eliminates nuisance odours.

The credit applies to expenditures made after April 19, 2004 and before 2015. Credits earned but unused in a given year may be carried back three years to taxation years that end after April 19, 2004 and carried forward for 10 years.

Effective starting 2006, agricultural corporations are eligible for a refundable part of the Odour Control Tax Credit. The maximum refund that a corporation can claim is the lesser of the portion of the tax credit that exceeds the credit claimed in the current year and the property tax paid, net of government assistance received or receivable on Manitoba farmland used by a corporation for farming.

An Income tax election allowing taxpayers to renounce, in whole or in part, the Odour Control Tax Credit is provided.

This income tax credit is administered by the Canada Revenue Agency on behalf of Manitoba.

For more information on the Odour Control Tax Credit, contact Taxation, Economic and Intergovernmental Fiscal Research Division, Manitoba Department of Finance.

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Nutrient Management Tax Credit

Agricultural producers are eligible for a new, refundable income tax credit, the Nutrient Management Tax Credit, to facilitate meeting new requirements for water quality protection under The Environment Act.

Eligible entities are agribusiness corporations with a permanent establishment in Manitoba and unincorporated Manitoba-resident individuals engaged in farming, as well as agricultural operations owned by a partnership (in which case the credit is allocated among Manitoba-resident partners).

The credit is equal to 10% of the capital cost of prescribed nutrient management equipment, net of any government assistance received or receivable for it. The assets must be acquired and available for use after April 17, 2012 and before 2016.

Qualifying investments include: solid-liquid separation systems, anaerobic digesters, gravity settling tanks, manure treatment systems, and manure composting facilities; also included are storage tanks suitable for winter manure storage by operators with fewer than 300 animal units.

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Manitoba Research and Development Tax Credit

This program targets scientific research and experimental development (as defined for federal purposes) carried on in Manitoba. Qualified expenditures must be incurred after March 11, 1992. Corporations earn a 20% tax credit which can be applied against Manitoba corporate income tax payable in the year earned, with unused credits available for a ten-year carry-forward and a three-year carry-back. This income tax credit is administered by the Canada Revenue Agency on behalf of Manitoba.

The credit is refundable for eligible expenditures incurred after 2009 by a corporation with a permanent establishment in Manitoba and where the research and experimental development is carried on in Manitoba under an eligible contract with a qualifying research institute.

Budget 2010 extended refundability of this tax credit to in-house R & D expenditures (i.e., R & D not undertaken under contract with an institute in Manitoba) as follows:

• starting 2011, one quarter of the credit for in-house R & D is refundable; and
• starting 2012, one half if the credit for in-house R & D will be refundable.

Educational Institutions Potentially Eligible for Participation in SR&ED Refundable Manitoba R&D Tax Credit Program (pdf - 15kb)

An income tax election allowing taxpayers to renounce, in whole or in part, the Research and Development Tax Credit is provided.

For more information on the Manitoba Research and Development Tax Credit,contact Taxation, Economic and Intergovernmental Fiscal Research Division, Manitoba Department of Finance.

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Federal Scientific Research and Experimental Development (SR&ED) Tax Incentives Program

The federal Income Tax Act permits a 100% deduction of SR&ED qualified expenditures from income. All qualifying expenditures form a "pool" which is increased by SR&ED expenditures and diminished by government or non-government assistance received in relation to these activities. Current and capital expenditures incurred in Canada, and current expenditures incurred outside Canada, are added to the pool.

Expenditures incurred in Canada may be deducted in the year incurred or carried forward indefinitely. Current expenditures incurred outside Canada can only be deducted in the year incurred. For purposes of calculating the amount of the SR&ED deduction in a given year, the "pool" of qualified expenditures is adjusted yearly and includes all prior years and current year expenses, less all assistance received or receivable for current or previous years in that year, less all research and development related tax credits claimed in previous years.

Provincial research and development ("R&D") credits reduce the SR&ED pool in the year received while federal tax credits reduce the pool in the following year. If the balance of the SR&ED pool is negative, the excess is treated as income for the year.

Unused tax credits are eligible for a carry-forward of up to seven years and a carry-back of up to three years.

When a corporation is not taxable in a given year and wishes to maximize the refundable federal tax credit, it may choose to renounce its right to the provincial tax credit.

For more information about the federal SR&ED tax incentives program, contact the Canada Revenue Agency, 325 Broadway, Winnipeg, at (204) 983-3918 or visit The Canada Revenue Agency Web site.

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Co-operative Development Tax Credit

To grow the cooperative sector, a new partly refundable tax credit is introduced for cooperatives and credit unions that make financial contributions towards cooperative development in Manitoba. Contributions of up to $50,000 made after September 2010 to a fund managed by the Manitoba Cooperative Association are used for the provision of technical assistance, the coordination of existing support and services, and the provision of small grants and strategic investments. All Manitoba's 400 credit unions and cooperatives qualify for this credit.

The schedule of refundable and non-refundable incentives is as follows:

• $0 to $1,000: 75 per cent refundable tax credit;
  
• $1,000 to $10,000: 75 per cent non-refundable tax credit;
  
• $10,000 to $30,000: 50 per cent non-refundable tax credit;
  
• $30,000 to $50,000: 33.3 percent non-refundable tax credit.

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Co-op Education and Apprenticeship Tax Credits

The CEATC family of tax credits provide qualified employers with a percentage of the wages and salaries paid to certain types of trainee employees and recent graduates working in Manitoba, net of other government funding for that remuneration. Eligible employers include taxable corporations and exempt corporate entities (such as not-for-profit agencies, Manitoba Crown entities, municipalities, universities, schools, and hospitals), which must claim the fully refundable credit in the company financial year in which it is earned. In addition, unincorporated employers can claim the refundable credit on their individual income tax return in the tax year in which it is earned.

For general information, contact:

Manitoba Tax Assistance Office
809-386 Broadway
Winnipeg, MB R3C 3R6
Fax: 204-948-2263
Phone: 204-948-2115 or 1-800-782-0771 (in Manitoba)
E-mail: tao@gov.mb.ca
Website: www.gov.mb.ca/finance/tao/index.html

 

Co-operative Education Components

CEATC includes two components to promote co-operative education, administered by the Council on Post-Secondary Education (COPSE), with credits to employers hiring students or recent graduates of a recognized post-secondary program of co-operative education anywhere in Canada or the world.

• Co-op Students Hiring Incentive: for placement of co-op education students into employment in Manitoba, lasting ten weeks or more, and linked to their studies. The credit equals 10% of net wages and salaries, up to a maximum credit of $1,000 per placement, with a lifetime maximum of five placements per student, but with no limit on the number of placements for which an employer may be credited. The credit is earned when the student completes a placement.
  
  
• Co-op Graduates Hiring Incentive: for hiring recent co-op education graduates into permanent employment in Manitoba, linked to their area of study. The credit equals 5% of net wages and salaries, earned on completion of each of the first two consecutive years of full-time employment, to a maximum credit per year of $2,500 per graduate. There is no limit on the number of co-op graduates for which an employer may be credited.

For more information on the co-operative education components of CEATC, please go to the Co-operative Education page. If you are a co-op education provider, contact:

The Council on Post-Secondary Education
608-330 Portage Avenue
Winnipeg, MB R3C 0C4
Phone: 204-945-1833
Fax: 204-945-1841
E-mail: info@copse.mb.ca
Website: www.copse.mb.ca/tax_credit/index.html

 

Apprenticeship Components

CEATC also includes three components to promote apprenticeship, administered by the Apprenticeship Branch of the Department of Entrepreneurship, Training, & Trade. These components provide employers with credits for hiring apprentices or recently certified journeypersons for work performed in Manitoba; the credit is earned when an apprentice completes a level or a journeyperson completes a first or second year of employment. The credit is claimed on the income tax return in the company financial year in which it was earned. Eligible trades include both Red Seal and non-Red-Seal trades. Budget 2012 announced the enhancement of the tax credit rates for these three components. Please see the table below for the existing and newly announced rates and conditions.

• Early-Level Apprentices Hiring Incentive: For hiring Level 1 and 2 apprentices, including high-school apprentices. The value of this component for employers has been doubled for rural and northern apprenticeships, and enhanced for all others. Because the enhanced Manitoba benefits now exceed those offered by the federal Apprenticeship Job Creation Tax Credit (AJCTC), employers eligible for the federal credit may now receive a top-up to the Manitoba benefit levels.
  
  
• Advanced-Apprentices Hiring Incentive: For hiring Level 3, 4, and 5 apprentices. The value of this component for employers has been doubled.
  
  
• Journeypersons Hiring Incentive: For an employer that has participated in the Manitoba apprenticeship program and hires recently certified journeypersons. The value of this component for employers has been doubled.

For more information on the apprenticeship components of CEATC and other aspects of apprenticeship financing, please go to the Apprenticeship Finances & Awards page, or contact:

Apprenticeship Manitoba
1010-401 York Avenue
Winnipeg, MB R3C 0P8
Phone: 204-945-3337
Fax: 204-948-2539
Toll-Free: 1-877-978-7233 (1-877-97-TRADE)
Email: apprenticeship@gov.mb.ca
Website: www.gov.mb.ca/tce/apprent/finance/index.html#grants

SUMMARY OF PARAMETERS FOR APPRENTICESHIP COMPONENTS OF CEATC
Component and Aspect		Current Parameters	Parameters with Newly Announced Enhancements
	applies to	Employers of Level 1-2 and high school apprentices finishing their level before 2013	Employers of Level 1-2 and high school apprentices finishing their level on or after January 1, 2013
	rate if apprentice normally resides outside Winnipeg and reports to an employer’s office in rural and northern Manitoba	10% of net wages & salaries in a year up to maximum credit of $2,000/year/apprentice (same as for Winnipeg-based apprentice)	20% of wages & salaries in a year up to maximum credit of $4,000/year/apprentice
	rate of credit for all other early-level apprenticeships	10% of wages & salaries in a year up to maximum credit of $2,000/year/apprentice	15% of wages & salaries in a year up to maximum credit of $3,000/year/apprentice
	interface with federal support	Employers eligible for federal AJCTC are ineligible (i.e., taxable corporations employing Level 1-2 Red Seal apprentices, excluding high-school apprentices)	Employers eligible for federal Apprenticeship Job Creation Tax Credit are eligible only for a top-up to Manitoba’s higher level of benefits
	applies to	Employers of Level 3-5 apprentices finishing their level before 2013.	Employers of Level 3-5 apprentices finishing their level on or after January 1, 2013.
	rate of credit	5% of net wages and salaries on completion of level up to a maximum credit of $2,500/level/apprentice	10% of net wages and salaries on completion of level up to a maximum credit of $5,000/level/apprentice
	applies to	Employers of Journeypersons certified before 2013 and hired within 18 months of certification	Employers of Journeypersons certified on or after January 1, 2013 and hired within 18 months of certification
	rate of credit	5% of net wages and salaries up to $2,500/completed year/journeyperson for the first one or two completed years	10% of net wages and salaries up to $5,000/completed year/journeyperson for the first one or two completed years

The total maximum tax credit for an employer who hires an apprentice through all five levels and for two years after certification as a journeyperson is $31,000 ($33,000 if the apprentice is in rural or northern Manitoba).

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Neighbourhoods Alive! Tax Credit

Commencing April 13, 2011, corporations that partner with charitable organizations to establish new social enterprises in Manitoba are eligible for a non-refundable 30% corporation income tax credit, in addition to the deduction for their corporate donation.

In a given year, a corporation can earn a maximum Neighbourhoods Alive! Tax Credit of $15,000, based on a cumulative minimum of $50,000 in donations to a qualifying registered charity to develop, manage and operate the new social enterprise. The monetary donation must be made over the course of the first four taxation years of the social enterprise and must be accompanied by the provision of in-kind services during years two through five of the social enterprise.

Large up-front donations of up to $200,000 can be used to earn the $15,000 maximum tax credit in years two through five, as long as the in-kind contributions are made in each of those years. Smaller annual donations can be made over multiple years and the cumulative total can be used to reach the $50,000 minimum donation threshold, as long as the donations are made in the first four taxation years of the social enterprise and the in-kind services are provided.

The newly created social enterprise must be fully owned and controlled by a charitable organization in Manitoba and have a charitable purpose that matches that of the charity. In addition, the social enterprise must have a mandate that includes hiring hard-to-employ Manitobans and at least 25% of its employees must have qualified as facing multiple barriers to employment when they were hired.

Tax credits earned but unused by a corporation in a given year can be carried back up to three years to a financial year that ends no earlier than April 12, 2011, and any remaining credits can be carried forward up to ten years.

For more information on the Neighbourhoods Alive! Tax Credit , contact Taxation, Economic and Intergovernmental Fiscal Research Division, Manitoba Department of Finance.

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Small Business Venture Capital Tax Credit - (formerly the Community Enterprise Investment Tax Credit)

The Small Business Venture Capital Tax Credit is a non-refundable, 30% income tax credit for resident investors who acquire equity capital in emerging enterprises that require larger amounts of capital than community ownership can provide. Corporate and individual investors qualify for this credit. The maximum credit that an investor can earn in a year is $135,000. The maximum amount of the tax credit deductible against Manitoba income tax is $45,000 per tax year. Any credits earned but unused in a given year are available, after 2007 and before 2013, to be carried forward for up to 10 years and carried back up to three years.

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