Canada’s 2021 Tax Incentive for Animation Industry
Canada has always taken initiatives to boost the animation industry. With one of the largest growing animation and VFX industries, Canada is creating more opportunities with its unparalleled tax incentives and taxation policies. The provincial and federal governments aim to bring in more investment, increase employment, and boost the country’s economy with the 2021 animation and special effects tax incentives.
This blog explores the potential of tax incentives in the animation industry, corporations that can avail these opportunities, and how they can apply for these incentives.
Refundable Tax Credit
Canadian provinces have different rules regarding refundable tax credit rates. Certain provinces, such as Ontario, offer a refundable tax credit worth 18% of the total labour expenses. Computer animation and special effects corporations can claim this refundable tax credit in the same taxation year.
Are you Eligible for the Animation Tax Credit?
Before you fill out the tax credit application forms, you need to qualify for the animation and special effects tax incentives. Here’s how you can determine your eligibility for the Animation and Special Effects Tax incentives in Canada.
How to Apply?
The first step to qualify and apply for the tax incentives is to gain an eligibility certificate from a provincial government agency. After you have been awarded the eligibility certificate, you can begin working on the application process by filing the T2 Corporation Income Tax Returns. Attach your certificate of eligibility and your completed animation and special effects tax credit application.
You can submit your documents and the tax returns online or drop a paper return at your local tax center. You’ll also be required to submit the total credit amount that you’re claiming.
Once you’ve submitted the required documents, the CRA will begin to process your application in a few days.
Are you finding it challenging to apply for tax incentives for your animation business? Faber LLP can assist you in the process!
We are full-service taxation, advisory, and accounting firm based in Edmonton, Alberta. We have worked with hundreds of individual clients and businesses and helped them file successful tax returns.
Head to our website or call us at 780-432-5262 and benefit from our taxation and advisory services today!