Nova Scotia Capital Investment Tax Credit

September 12, 2023

In Canada Funding for Manufacturers Agriculture Nova Scotia Tax Credit Economic Development Canada

Up to $30 Million in Funding available through the Nova Scotia Capital Investment Tax Credit Program

The Nova Scotia Capital Investment Tax Credit (CITC) is a highly beneficial program that has been specifically designed to drive economic growth and development within the province. This tax credit provides significant financial advantages to eligible corporations that choose to invest in capital equipment for approved projects located in Nova Scotia.

By participating in the CITC program, eligible corporations can gain access to up to $30 million in funding. This substantial financial support can be instrumental in fueling growth, expansion, and innovation within the Nova Scotia business landscape. Whether it's upgrading existing infrastructure, investing in cutting-edge technologies, or diversifying product streams, the CITC program aims to provide the necessary resources to enable corporations to thrive in a competitive marketplace.

Funding Overview

The Nova Scotia CITC program provides a generous tax credit to eligible corporations. Here's what you need to know about the funding amount:

  • Tax Credit Percentage: Corporations can benefit from a 25% refundable corporate income tax credit based on the capital cost of "qualified property" acquired for use in Nova Scotia as part of an "approved project." This credit can substantially reduce your corporate tax liability.

  • Maximum Tax Credit: While the tax credit is substantial, it's important to note that there is a maximum limit of $30 million per "approved project." Be sure to assess your project's potential and tax credit eligibility against this cap.

Eligibility Requirements
 
Here are the key eligibility criteria:

  • Corporate Status: To qualify, your business must be a taxable Canadian corporation.

  • Establishment in Nova Scotia: Your corporation must have a permanent establishment within Nova Scotia.

  • Eligible Sectors: In most cases, eligible corporations come from sectors such as manufacturing, processing, fishing, farming, logging, storing grain, and harvesting peat.

  • Approved Project: Capital equipment should be acquired as part of an "approved project." This emphasizes the importance of aligning your investments with pre-defined projects to benefit from the tax credit.


Eligible Activities

Eligible activities for the Nova Scotia Capital Investment Tax Credit (CITC) program are primarily determined by the acquisition of "qualified property" as part of an "approved project.":

  1. Qualified Property: Eligible activities revolve around the acquisition of "qualified property." To be considered qualified property, the asset or equipment must meet specific criteria set by the program. While the program provides a broad definition of qualified property, it typically includes capital assets such as machinery, equipment, buildings, and infrastructure necessary for the approved project.

  2. Approved Project: Eligible activities must be part of an "approved project." The term "approved project" refers to a well-defined initiative or undertaking that is reviewed and accepted by the program administrators. To qualify for the CITC program, your investment in qualified property must be linked to a specific project that aligns with the program's goals and criteria. This project could involve activities such as:

    • Expanding or upgrading manufacturing facilities.
    • Investing in advanced technology and equipment.
    • Enhancing processing capabilities.
    • Establishing or renovating infrastructure for farming, fishing, or logging.
    • Any other capital-intensive project that stimulates economic growth in Nova Scotia.
Deadline
 
The Nova Scotia Capital Investment Tax Credit (CITC) program does not have a specific deadline for the completion of approved projects. Instead, it operates on a rolling basis, allowing flexibility for businesses with projects that may span several years.

 

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