Taxes might be boring, but how about saving money through tax credits (or getting a tax refund)?
Now we’re talking!
Make sure your accountant is aware of these 8 credits…
Best Tax Credits for Ontario Businesses
1. Ontario Ministry of Finance – Co-operative Education Tax Credit (CETC)
The Co-operative Education Tax Credit is a refundable tax credit available to employers who hire students enrolled in a co-operative education program at an Ontario university or college. Most work placements are for a minimum employment period of 10 weeks up to a maximum of four months.
2. Canada Revenue Agency – Scientific Research and Experimental Development Tax Incentive Program (SR&ED)
The Scientific Research and Experimental Development (SR&ED) program uses tax incentives to encourage Canadian businesses of all sizes and in all sectors to conduct research and development in Canada.
3. Canada Revenue Agency – Ontario Innovation Tax Credit (OITC)
The Ontario Innovation Tax Credit is a refundable tax credit that is applied to the lesser of the corporation’s qualified expenditures incurred in Ontario and its annual expenditure limit.
4. Canada Revenue Agency – Ontario Research and Development Tax Credit (ORDTC)
ORDTC is a non-refundable tax credit based on eligible scientific research and experimental development performed by qualifying corporations in Ontario to reduce their Ontario corporate income tax payable.
5. Canada Revenue Agency – Ontario Business Research Institute Tax Credit (OBRITC)
The Ontario Business-Research Institute Tax Credit is fully refundable at the rate of 20% of qualified expenditures. It is available to corporations and corporations that are members of partnerships (other than specified members) with a permanent establishment in the province of Ontario in respect of qualified expenditures on SR&ED incurred under eligible contracts with eligible research institutes (ERIs).
6. Ontario Ministry of Finance – Regional Opportunities Investment Tax Credit
The Regional Opportunities Investment Tax Credit is a 10% refundable Corporate Income Tax that supports business investment, economic growth and job creation in designated regions across the province that lagged in employment growth between 2009 and 2019.
7. Ontario Ministry of Finance – Ontario Dividend Tax Credit
The Ontario Dividend Tax Credit is intended to compensate individual shareholders for income tax paid by Canadian companies in which they have invested. Individual investors pay personal income tax on dividends, which are paid from corporate earnings that have already been taxed. The purpose of this tax credit is to avoid this double taxation.
8. Canada Revenue Agency – Ontario Transitional Tax Debits and Credits
Corporations may be subject to an Ontario transitional tax debit or be eligible to claim an Ontario transitional tax credit due to the harmonization of the two legislative acts governing federal and Ontario income taxes.