The Province of Saskatchewan announced in its 2015-2016 Budget that it plans to reduce the benefits offered through its Research and Development (R&D) Tax Credit program. Previously, Canadian Controlled Private Corporations (CCPCs) conducting R&D in Saskatchewan were eligible for a 15% refundable tax credit on the first $3 million in qualifying expenditures. Expenditures incurred above this level or by non-CCPC entities were eligible for a 15% non-refundable tax credit. Non-refundable tax credits may be applied to reduce corporate taxes owing in the previous 3 or subsequent 10 years.
Under the new Budget proposal, the R&D Tax Credit will be reduced to a 10% non-refundable Investment Tax Credit (ITC) in all cases. The changes will be effective as of April 1, 2015, assuming that the Budget is passed as tabled. The CBC reported on March 18, 2015 that the Government of Saskatchewan expects to save $18 million through this measure.
Detailed information on the proposed Saskatchewan Provincial Budget is available at: www.finance.gov.sk.ca/budget2015-16/201516Budget.pdf
Note: TSGI does not maintain this news article after its initial posting. Readers are further advised that the information presented here may not be sufficient for unassisted tax planning. Please contact a TSGI representative if you require clarification or other assistance regarding this topic.