Information Bulletin, November 18, 1997

On October 29, 1997, the federal government announced the elimination of production services tax shelters and the introduction of an 11 per cent tax credit for foreign-based and non-Canadian-content productions. Ontario automatically parallels the federal elimination of production services tax shelters.

To enhance Ontario's competitive advantage in film and television production and attract jobs and investment to the province, Ontario will be introducing legislation to provide an 11 per cent refundable tax credit to productions in Ontario which qualify for the new federal film or video production services tax credit.

Ontario Film and Television Production Services Tax Credit

• Effective November 1, 1997, an 11 per cent refundable tax credit on qualifying labour expenditures will be available to eligible production companies producing film or television productions in Ontario.
• In order to minimize complexity and ensure ease of compliance and administration, the tax credit will harmonize with the federal film or video production services tax credit.
• Ontario's 11 per cent refundable tax credit will be available to foreign-based production companies producing in Ontario.

Eligible Production Companies

A production company must have a "permanent establishment" in Ontario and be producing in Ontario a production that qualifies for the federal film or video production services tax credit.

Qualifying Labour Expenditures

• Qualifying labour expenditures will be limited to Ontario labour expenditures under the federal film or video production services tax credit.
• Ontario labour expenditures will be salaries and wages incurred after

October 31, 1997 and paid to individuals resident in Ontario at the end of the previous calendar year.

Claiming the Tax Credit

• A certificate of eligibility must be filed with the production company's Ontario corporate income tax return.
• The tax credit will be applied against outstanding Ontario tax liabilities and any excess will be refundable.

For further information contact:

Ministry of Revenue Taxation Policy Branch 7 Queen's Park Crescent East Toronto, Ontario M7A 1Z2 Attention: Darlene Masliwec 416 327-0257 Fax: 416 327-0260	Ministry of Revenue Tax Design & Legislation Branch 95 Grosvenor Street Toronto, Ontario M7A 1Z1 Attention: Rick Munro 416 325-2451 Fax: 416 314-8635
Ontario Film and Development Corporation 175 Bloor Street East North Tower, Suite 300 Toronto, Ontartio M4W 3R8 Attention: Sara Morton 416 314-6858 Fax: 416 314-6876

For more information visit ontario.ca/revenue