This refundable provincial Corporate Income Tax credit is provided for eligible local film projects at a rate of 40% of eligible local labour costs, but may not exceed 25% of production costs. The 2005 provincial budget announced the replacement of two credit caps ($1 million per eligible project or $2 million per corporation) with a single corporation credit limit of $3 million. The credit limit was further increased to $4 million in the 2013 provincial budget. The corporation must also pay at least 25% of its salaries and wages to residents of the province. The 2005 provincial budget also announced the removal of the restriction that the production corporation, together with any associated corporations, must have less than $25 million in assets.
The corporation must first apply for eligibility to the Newfoundland and Labrador Film Development Corporation prior to the commencement of production. Once the project is completed, and financial statements and cost reports finalized, the eligible corporation may then apply for the tax credit. Upon approval from the Department of Finance, the eligible corporation is issued a tax credit certificate which must be attached to the T2 return.
For more information, please contact the Taxation and Fiscal Policy Branch.