If you receive eligible dividends on or after January 1, 2006 from a Canadian corporation, you may claim an enhanced dividend tax credit to reduce the provincial portion of your income taxes.
To match the federal government's gross up of eligible dividends, Ontario is raising the tax credit from 5.13 per cent to 7.7 per cent by the year 2010. See chart below for phase in dates:
Ontario Dividend Tax Credit Rate
| Taxation Year | Rate for Eligible Dividends (%) | Rate of Other Canadian Dividends (%) |
| 2005 | 5.13 | 5.13 |
| 2006 | 6.5 | 5.13 |
| 2007 | 6.7 | 5.13 |
| 2008 | 7.0 | 5.13 |
| 2009 | 7.4 | 5.13 |
| 2010 | 7.7 | 5.13 |
