Paid Work Experience Tax Credits
Highlights
This program is designed for businesses like yours, offering significant tax credits to support your growth and innovation. By applying, you can benefit from an 8% tax credit on qualified plant, machinery, and equipment for first-time use in manufacturing or processing in Manitoba. This credit is 7/8 refundable, meaning you get most of your investment back, which can be a substantial financial boost.
What's in it for you?
- Immediate financial relief through tax credits.
- Long-term savings with a 10-year carry-forward for unused credits.
- Support for renewable energy and efficient energy use with additional credits for Class 43.1 and 43.2 equipment.
Qualifying for this program is straightforward, and being approved can significantly reduce your corporate income tax payable. This means more capital to reinvest in your business, helping you stay competitive and innovative.
Financing Details
Type of Financing: Tax Credit
Repayment Terms and Interest Rates:
- This tax credit is refundable, meaning you can receive a refund if the credit exceeds your tax liability.
- There are no repayment terms or interest rates associated with this tax credit.
Eligible Expenses:
- Qualified plant, machinery, and equipment for first-time use in manufacturing or processing in Manitoba.
- Equipment used to produce energy from renewable sources and equipment that uses energy more efficiently (Class 43.1 and Class 43.2 assets).
Ineligible Expenses:
- The funds cannot be used for any expenses that do not fall under the categories of qualified plant, machinery, and equipment for manufacturing or processing.
- Non-renewable energy equipment and any other non-qualifying assets.
Fees:
- There are no fees associated with applying for or receiving this tax credit.
Qualifications
- Must be a corporation acquiring qualified plant, machinery, and equipment for first-time use in manufacturing or processing in Manitoba.
- Must acquire eligible property on or after April 12, 2017, but before July 1, 2019, to earn a nine per cent tax credit.
- Must acquire eligible property on or after July 1, 2019, to earn an eight per cent tax credit.
- Equipment under class 43.1 and class 43.2 also qualifies for the credit.
Must have a permanent establishment in Manitoba.
Disqualifications:
- Businesses not acquiring qualified plant, machinery, and equipment for first-time use in manufacturing or processing in Manitoba.
- Businesses without a permanent establishment in Manitoba.
Description
This program offers your business an eight percent tax credit for buying new plant, machinery, and equipment for manufacturing or processing in Manitoba. Seven percent of this credit is refundable, meaning you get cash back, and one percent is non-refundable, which reduces your tax bill.
You can use this credit to offset your Manitoba corporate income tax for the year you earn it. If you don't use it all, you can carry it forward for up to ten years. This flexibility helps manage your cash flow and tax planning.
Additionally, the program includes equipment that produces renewable energy or uses energy more efficiently. This can help lower your energy costs and make your business more sustainable. This tax credit is a straightforward way to invest in your business's growth and efficiency.
Program Steps
Gather Necessary Documentation:
- Financial statements
- Business plan
- Details of intended use of funds (e.g., quotes for equipment or renovation costs)
- Proof of Manitoba residency for employees (if applicable)
Complete the Application Form:
- Access the application form from the relevant government website or contact the Manitoba Tax Assistance Office for guidance.
Prepare Supporting Documents:
- Ensure all financial documents are up-to-date and accurate.
- Include any additional documentation that supports your eligibility and the intended use of funds.
Submit the Application:
- Submit the completed application form along with all required documentation to the appropriate government office or online portal.
Await Confirmation:
- Wait for confirmation that your application has been received and is being processed.
Respond to Any Follow-Up Requests:
- Be prepared to provide additional information or clarification if requested by the reviewing authority.
Receive Approval and Tax Credit Certificate:
- Upon approval, you will receive a tax credit certificate detailing the amount and terms of the credit.
File Tax Credit with Annual Income Tax Return:
- Include the tax credit certificate when filing your annual corporate income tax return to claim the credit.
Maintain Records:
- Keep all documentation and correspondence related to the tax credit application for future reference and potential audits.
