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Ontario Announces Regional Opportunities Investment Credit

March 26, 2020
By Bob Peters

Cornwall Ontario – As part of its sweeping Action Plan to provide support to Ontarians in the COVID-19, Ontario has announced a Regional Opportunities Investment Credit.

The Regional Opportunities Investment Credit will introduce a new 10 per cent refundable Corporate Income Tax credit for capital investments and is available only in rural areas of the province – including Cornwall and the United Counties of Stormont Dundas and Glengarry.

The following details of the Regional Opportunities Investment Credit have been published:

Eligible Corporations

A Canadian-controlled private corporation that makes qualifying investments that become available for use on or after March 25, 2020 in specified regions of Ontario would be eligible for the tax credit.

“Available for use” refers to the rules set out in the Income Tax Act (Canada) that determine the taxation year in which a taxpayer can start to claim capital cost allowance for a depreciable property.

Qualifying Investments

Qualifying investments would be eligible expenditures for capital property included in Class 1 and Class 6 for the purposes of calculating capital cost allowance. Qualifying investments would include expenditures for constructing, renovating or acquiring eligible commercial and industrial buildings and other assets.

Spending Requirement

The tax credit would be available for expenditures in excess of $50,000 and up to a limit of $500,000 for qualifying investments that become available for use by a Canadian-controlled private corporation in the taxation year.

Three-Year Reviews

The government proposes to include a mandatory review to be undertaken every three years. The review would evaluate the credit for effectiveness, compliance burden and administrative costs.