Finance - Small Business Corporate Income Tax Holiday

Small Business Corporate Income Tax Holiday

Beginning in April 2003, a new corporate income tax (CIT) holiday is available for new small businesses that operate in designated growth sectors of the economy and are not associated with another business.

Designated growth sectors are:

technology
aquaculture
manufacturing
export
tourism

research and development
forestry and agrifoods
processing
import replacement
cultural

Business activities not eligible include:

incorporation of an existing business
wholesale and retail trade
food and liquor establishments
personal services, business services, professional practices and trades
real estate marketing and development

oil and gas development and production
mineral resource exploration
financial services
fish harvesting and primary fish processing, except the processing of underutilized species

The tax holiday will provide a provincial corporate income tax exemption to eligible businesses incorporated between April 1, 2003 and March 31, 2006.

For businesses located on the Northeast Avalon, the tax holiday will be provided for the new company’s first three fiscal years. For those located outside the Northeast Avalon, the tax holiday will apply for five years.

Provincial Income Tax Act
Small Business Tax Holiday Guidelines (PDF)
Small Business Tax Holiday Application (PDF)

March 27, 2003 - Government announces new small business corporate income tax holiday
Canada Revenue Agency

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