Department of Finance

Newfoundland and Labrador Interactive Digital Media (IDM) Tax Credit

Amount:

$2,000,000

Type of Program:

Tax Credit

Description:

The Newfoundland and Labrador Interactive Digital Media (IDM) is a refundable tax credit based on eligible salaries and eligible remuneration incurred by an eligible corporation for the development of interactive digital media products during the period of January 1, 2015 to December 31, 2024 inclusive. Applicants must apply to the Minister of Finance for a tax credit certificate within six months of the end of each taxation year.

Comments on Funding:

Funding is 40% of qualifying expenditures.
Eligible expenditures include eligible salaries and 65% of eligible remuneration.
The credit value is limited to $40,000 per employee per year and $2 million per company, or group of associated companies, per year.

When It Ends:

Ongoing

Deadline:

Rolling deadline

Eligibility:

The applicant must:

be a corporation developing an interactive digital media product,
be primarily carrying on the business of interactive digital media development,
have a permanent establishment in the province of Newfoundland and Labrador,
be a taxable Canadian corporation,
hold a valid registration certificate under the IDM program.
be incorporated under the Corporations Act or an Act of the Parliament of Canada or another Canadian province,

Application Steps:

The application process is a two part process:

first apply for a registration certificate as an eligible corporation. It is recommended that applications be made through the NL Film Development Corporation (part I application form),

apply to the Minister of Finance for a tax credit certificate within 18 months of the end of each taxation year (part II application form),

file the T2 return.

Documentation Needed:

Applicants must submit the following with the Part I application:

incorporating documents, including any subsequent amendments since incorporation,
copy of Corporate Income Tax Return (T2) Schedules 9, 23 and 50 (Required when the corporation is associated with any other corporation,
corporate chart, if the corporation conducts business with non-arm’s length corporations,
description of the project, including: technical specifications, product documentation, storyboard, interactive features, images, text and sound,
development timeline,
list of estimated eligible salaries,
list of estimated eligible remuneration,
detailed list of estimated product costs,
financial statements for the preceding taxation year.

Applicants must submit the following with the Part II application:

financial statements for the taxation year in which the credit is being claimed,
individual declaration of residency forms to support Schedule B (Eligible Salaries),
statement of eligible remuneration form to support Schedule C (Statement of Remuneration),
workplace health and safety compensation commission of Newfoundland and Labrador annual employer payroll statement for the taxation year,
proof of payment for eligible remuneration paid within 60 days after the end of the taxation year as indicated in Schedule C.

Program Contact:

Newfoundland and Labrador Interactive Digital Media (IDM) Tax Credit

Interactive Digital Media Tax Credit Registration Form (PART I)

Interactive Digital Media Tax Credit Certificate Application (PART II)

Newfoundland and Labrador Interactive Digital Media (IDM) Tax Credit – Guidelines

Film and Video Tax Credit

Amount:

$5,000,000.00

Type of Program:

Tax Credit

Description:

The Film and Video Tax Credit is a refundable provincial corporate income tax credit and is provided for eligible local film projects at a rate of 40% of eligible local labor costs, but may not exceed 25% of production costs.

Comments on Funding:

Funding is 40% of eligible local labor costs, but may not exceed 25% of production costs. The maximum tax credit within a 12 month period that may be received by an eligible corporation, together with all corporations associated with that corporation, in respect of all eligible projects commenced on or after July 1, 2021 is $5,000,000.

When It Ends:

Ongoing

Deadline:

Rolling deadline

Eligibility:

The applicant must:

be a corporation incorporated under the Corporations Act or an Act of the Parliament of Canada or of the legislature of a province and have a permanent establishment in the province,
primarily carry on the business of film, television or video production,
pay at least 25% of salaries and wages with respect to an eligible project in Newfoundland and Labrador to eligible employees (for work performed in the province),
be producing an eligible project (a film television program or series or video program and the subject of the proposal is drama, variety, animation, children’s programming, music programming, an informational series or a documentary).

Application Steps:

first apply for eligibility to the Newfoundland and Labrador Film Development Corporation prior to the commencement of production,

apply for the tax credit once the project is completed, and financial statements and cost reports finalized,

attach the tax credit certificate to the T2 return.

Documentation Needed:

Applicants must provide the following information:

the estimated total production costs and the estimated eligible salaries,
the estimated value of the tax credit
a financing plan including recoupment schedule,
the expected revenue from the sale of the production,
a script,
other information the minister may require.

Other Things to Note:

The Film and Video Tax Credit is administered by the Newfoundland and Labrador Film Development Corporation (NLFDC) for the Newfoundland and Labrador Department of Finance.

Program Contact:

Film and Video Tax Credit

NLR 3/99 - Film and Video Tax Credit

Newfoundland and Labrador Film Tax Credit

Direct Equity Tax Credit

Amount:

$50,000

Type of Program:

Tax Credit

Description:

The Direct Equity Tax Credit is designed to encourage private investment in new or expanding small businesses as a means of creating new jobs and diversifying the economy. An investment credit, in the form of a provincial income tax credit, is available to individuals and arm’s length corporations who invest as shareholders in eligible small business activities.

Comments on Funding:

There are two tax credit rates:

a 35% rate applies when the qualifying activities are undertaken in the Province outside the North East Avalon,
a 20% rate applies when the qualifying activities are undertaken within the North East Avalon.

In cases where qualifying activities are undertaken in both areas, a reasonable proration applies.
The maximum annual tax credit per eligible investor is $50,000.

When It Ends:

Ongoing

Deadline:

Rolling deadline

Eligibility:

The applicant must:

individuals 19 years of age or older who are residents of Newfoundland and Labrador or otherwise paying income tax to the Province,
corporations which operate at arm’s length from the eligible business.

In order to qualify as an eligible business, a corporation shall:

be a Canadian controlled corporation and not a publicly traded corporation
have a permanent establishment in Newfoundland and Labrador
have less than $20 million in assets, including associated corporations,
utilize in the province all of the capital raised from the specified issuance,
have no more than 50 full time equivalent positions,
have at least $25,000 of either or both of shareholder equity and shareholder loans before applying for certification,
must be engaged in, and will utilize funds for, qualifying activities (technology, research and development, aquaculture, forestry and agrifoods, manufacturing and processing, export / import replacement businesses, tourism, cultural industries).

Application Steps:

make an application to the Department of Finance to obtain certification. This verifies that the specified shares are eligible for the tax credit. Pre-approval of eligibility is required.

submit an official tax credit receipt with the individual’s T1 Income tax return or the corporation’s T2 income tax return.

Documentation Needed:

Applicant must submit:

an official tax credit receipt,
the individual’s T1 Income tax return or the corporation’s T2 income tax return
financial statements, as required by the Minister. These statements must include an independent auditor’s statement that the corporation is in good standing and that the specified share issuance meets all the requirements of the Direct Equity Tax Credit program.
information confirming the use or disposition of capital raised under the Direct Equity Tax Credit program, to ensure compliance with requirements such as qualifying business activities and prohibited uses of funds, if requested
a detailed status report of shareholdings for five years after specified share issuances and detailed information on the directors of the investing corporation.

The following information should be included with the application:

names and addresses of all directors of the applicant corporation,
copy of the certificate of incorporation,
financial statements for the most recent year end of the corporation and all associated corporations together with a review engagement report or auditor’s report,
income tax returns and schedules for the preceding taxation year for the corporation and all associated corporations,
the amount to be raised by the specified issue,
detailed description of the proposed business activities,
detailed description of the proposed use of funds raised,
the proposed locations for the utilization of funds,
other information that the Minister may require.

Program Contact:

Direct Equity Tax Credit

Direct Equity Tax Credit Guidelines

Grants-in-Lieu of Property Taxes Program

Amount:

No Fixed Amount

Type of Program:

Grants

Description:

The Grant-In-Lieu Taxes program provides limited financial support for approved non-profit organizations, community groups, or municipalities that are providing specified services in the community by forgiving (crediting) non-commercial provincial property taxes.

Comments on Funding:

Grants must be based on need, as established by financial statements, and should not exceed the amount of provincial non-commercial taxes payable.
Grants are approved for a three-year period at which time the applicant must re-apply to determine eligibility.

When It Ends:

Ongoing

Deadline:

Rolling Deadline

Eligibility:

Applicants must be Prince Edward Island non-profit organizations.

Application Steps:

Applicants must submit the application form and supporting documents to Taxation and Property Records.

Each Grant-in-Lieu of Property Taxes Program application requires Treasury Board approval. Upon approval, Treasury Board will authorize a credit to be made against the property tax account of the applicant and a letter, signed by the Minister of Finance (or designate) will be mailed to all applicants indicating the grant amount approved.

Treasury Board will not consider grant requests that are more than one year prior to the fiscal year in which the grant is request.

Grants are approved for a three-year period at which time the applicant must re-apply to determine eligibility.

Documentation Needed:

The applicant must submit:

the completed application form,
a copy of the latest available annual financial statements,

Program Contact:

Grants-in-Lieu of Property Taxes Program

Venture Capital Tax Credit

Amount:

$75,000

Type of Program:

Tax Credit

Description:

The Venture Capital Tax Credit Program (VCTC) is a provincial non-refundable tax credit available for both individual and corporate investors, but not trusts, equal to 30% of the amount invested in the qualifying venture capital fund (QVCF) through the purchase of limited partnership units or newly issued shares.

Comments on Funding:

Funding is a non-refundable tax credit equal to 30% of the amount invested in a Qualifying Venture Capital Fund.
The maximum tax credit available to a qualifying investor is $75,000. As a non-refundable tax credit, the VCTC can be carried back 3 years and forward 7 years (but not prior to 2014).

When It Ends:

Ongoing

Deadline:

Rolling deadline

Eligibility:

The applicant must:

be individual or corporate investors that purchase shares in the fund, which then uses capital raised from investors to make equity investments in qualifying businesses (business activities include intellectual property, information technology, clean, ocean and marine technologies, life sciences and new media sectors and manufacturing and processing of value-added goods for export),
hold the shares for a minimum 5 years or the tax credit has to be repaid in proportion to the amount of time the shares were held

Other Things to Note:

Decisions on investments will be made by the fund manager, Venture Newfoundland and Labrador Limited Partnership.

The Province of Newfoundland and Labrador in no way guarantees the value of any shares issued by a qualifying business under the VCTC program nor does it in any way express an opinion as to the financial condition of the issuing company or the merits of any investments made under the program.

Program Contact:

Venture Capital Tax Credit

FAQ Venture Capital Tax Credit