How to claim the Clean Technology (CT) Investment Tax Credit (ITC): Step-by-Step Guide
The Clean Technology Investment Tax Credit (CT ITC) is a federal refundable investment tax credit that can cover up to 30% of the capital cost of eligible clean technology property placed in service in Canada. For many organizations, this credit is a cornerstone incentive to finance projects such as solar, wind, hydro, battery storage, heat pumps, geothermal, non-road zero-emission vehicles, concentrated solar, and small modular nuclear reactors.
Administered by the Canada Revenue Agency (CRA) with technical guidance from Natural Resources Canada (NRCan), the CT ITC is claimed through your T2 corporate return or T3 trust return. This guide explains, in detail, how to claim the credit, which forms to file, how to elect into the labour requirements to maximize your rate, and what to expect after filing. All details are current as of December 1, 2025; always verify program rules before filing.
Overview of the Clean Technology Investment Tax Credit
The Clean Technology ITC is available for eligible property that becomes available for use:
From March 28, 2023, to December 31, 2033: up to 30% of capital cost if you elect to meet labour requirements; up to 20% if you do not elect.
From January 1, 2034, to December 31, 2034: up to 15% of capital cost if you elect to meet labour requirements; up to 5% if you do not elect.
The credit is unavailable after 2034.
The CT ITC is claimed by:
Taxable Canadian corporations (including corporations that are members of a partnership).
Mutual fund trusts that are real estate investment trusts (MFT‑REITs), including those that are members of a partnership.
Eligible clean technology property includes:
Equipment to generate electricity from solar, wind, and water.
Stationary electricity storage that does not use fossil fuels (including batteries and pumped hydro).
Active solar heating; air-source and ground-source heat pumps.
Non-road zero-emission vehicles (ZEVs) and related charging/refuelling equipment.
Geothermal equipment generating heat/electricity, excluding systems connected to fossil fuel extraction.
Concentrated solar energy equipment.
Small modular nuclear reactors (SMRs).
You cannot claim more than one clean economy ITC on the same property. For example, you cannot double-claim the CT ITC and the Carbon Capture, Utilization and Storage (CCUS) ITC on the same asset. You may, however, claim multiple clean economy ITCs within the same project if the project contains different eligible property types. In addition, you can claim the CT ITC together with the Atlantic investment tax credit, subject to their respective rules.
Eligibility Requirements
To claim the Clean Technology Investment Tax Credit, ensure that:
You are a taxable Canadian corporation or an MFT‑REIT. Members of partnerships can claim to the extent amounts are allocated to eligible members.
The property is eligible CT property and:
Is situated in Canada and intended for use exclusively in Canada.
Is new (not previously used or acquired for use or lease before you acquired it).
Becomes available for use within the relevant window (2023–2034).
If leasing the property to another party, the leasing conditions are met:
The lessee is a taxable Canadian corporation, an MFT‑REIT, or a partnership consisting entirely of taxable Canadian corporations.
The lessor leases in the ordinary course of business in Canada and principally carries on any combination of selling/servicing such property, leasing property, lending money, or purchasing conditional sales contracts or similar receivables.
You elect to meet labour requirements for prevailing wages and apprenticeships if you intend to claim the higher (regular) rate. If you do not elect, your credit rate is reduced by 10 percentage points.
The property is not being claimed under another clean economy ITC (such as CCUS) for the same asset.
If you are part of a partnership, proper allocation documentation (e.g., T5013 slips) is obtained and consistent with partnership filings.
For assets also described in Class 43.1 or 43.2, you consider stacking with accelerated capital cost allowance (ACCA), which is separate from ITCs.
You have sufficient documentation to prove ownership, capital cost, installation, commissioning, and the available‑for‑use date.
Required Documents
Before filing, compile a complete dossier. Typical items include:
Project documentation:
Purchase agreements, invoices, and proof of payment for equipment and installation.
Delivery records, commissioning reports, and an available‑for‑use certificate or equivalent evidence.
Technical specifications identifying the property category (e.g., solar PV modules, inverters, wind turbines, BESS, heat pumps, geothermal equipment, SMR components).
Site plans and installation records supporting “situated in Canada” and exclusive Canadian use.
Accounting and tax support:
Capital cost calculation working papers, including class assignment and any Class 43.1/43.2 notes.
Available‑for‑use test memo and date substantiation.
Reconciliation of claim amounts with the general ledger and fixed asset subledger.
Labour requirements (if electing to claim the higher rate):
Prevailing wage policies, project labour agreements, or wage schedules.
Apprenticeship participation plans and ratios, including subcontractor attestations.
Payroll records and timesheets for covered workers on or after November 28, 2023.
Leasing (if applicable):
Lease agreements and addenda, showing eligible lessee type and business‑in‑ordinary‑course conditions.
Evidence of the lessor’s principal business activities.
Partnerships (if applicable):
Schedule 75 for partnerships (electronic T5013SCH75).
T5013 slips for each member, showing CT ITC (box 265), labour requirements addition to tax (box 266), and CT ITC recapture (box 267).
Entity‑specific forms:
Corporations: T2SCH75 and T2SCH31 with CT ITC on line 155 and the total included on T2 line 780.
MFT‑REITs: Form T1098 and T3 entry on field 881 (line 57).
Compliance and audit readiness:
Internal review/approval sign‑offs.
Master list of supporting evidence for potential CRA review.
Recapture monitoring plan for the 10‑year period after acquisition.
Step-by-Step Application Process
Follow these steps to claim the Clean Technology ITC. Steps differ slightly for corporations, partnerships, and MFT‑REITs.
Step 1: Confirm entity and project eligibility
Determine whether you are a taxable Canadian corporation or an MFT‑REIT. If you are a member of a partnership, confirm that allocations will be made to eligible members.
Confirm that each asset you plan to claim is eligible CT property and intended for use exclusively in Canada.
If your project includes multiple asset types, map each asset to its clean economy ITC category to avoid double‑claiming on the same property.
Step 2: Decide on the labour requirements election
Elect to meet the prevailing wage and apprenticeship requirements if you want the higher (regular) rate.
Understand the consequences: if you elect but fail to comply, an addition to tax can apply. If you do not elect, your rate is reduced by 10 percentage points.
Establish processes to document compliance for covered work performed on or after November 28, 2023.
Step 3: Establish the available‑for‑use date and capital cost
Determine when each asset became available for use. Your CT ITC rate depends on this date.
Calculate the capital cost for each asset, including eligible installation costs. Maintain clear working papers for each property.
If assets qualify for Class 43.1/43.2, plan ACCA claims separately from your ITC.
Step 4: Compile documentation
Gather invoices, contracts, commissioning evidence, technical specifications, Canada‑use substantiation, payroll/labour records, and—if applicable—leasing and partnership documentation.
Create an index that maps each asset to its evidence and the claimed amount.
Step 5: Complete the claiming forms (corporations)
Prepare Schedule 75, Clean Technology Investment Tax Credit (T2SCH75), electronically.
Complete Schedule 31 (T2SCH31) and report the CT ITC on line 155. Ensure the amount flows to line 780 of the T2 Corporation Income Tax Return.
If you are a member of a partnership, include any allocated amounts from T5013 slips.
File the T2 return with all schedules and supporting details using your usual filing method by the T2 filing due date.
Step 6: Complete the claiming forms (partnerships)
Prepare the partnership’s Schedule 75 (T5013SCH75) electronically with full details of the ITC computation.
Issue T5013 slips to each member showing:
Box 265: Clean Technology ITC.
Box 266: Labour requirements addition to tax (if applicable).
Box 267: CT ITC recapture (if applicable).
Provide members with the partnership details to support their corporate or trust filings.
Step 7: Complete the claiming forms (MFT‑REITs)
Prepare Form T1098, Clean Technology Investment Tax Credit, electronically with details of the calculation.
Report the amount on field 881 (line 57) of the T3 Trust Income Tax and Information Return.
If you are a member of a partnership, include allocated T5013 amounts in your claim.
Step 8: Verify interactions with other credits
Confirm that you are not claiming multiple clean economy ITCs on the same property.
If your project includes different eligible property types, claim each on its appropriate schedule.
If applicable, coordinate with the Atlantic investment tax credit.
Step 9: File by the due date
File the appropriate return (T2 or T3) by its filing due date. CRA may accept late filing of the appropriate information if it is filed no later than one year after the original filing due date.
Ensure that Schedule 75 (corporations and partnerships) and Form T1098 (MFT‑REITs) are completed electronically and filed using the same method as your T2 or T3 return.
Step 10: Prepare for CRA review and recapture monitoring
Some claims are selected for review. Be ready to provide project, technical, financial, and labour documentation.
Establish a control to track potential recapture events for 10 years:
Conversion of the property to non‑clean technology use.
Export of the property from Canada.
Disposition of the property.
Report any recapture in the prescribed form by the applicable due date.
Application Timeline
Planning and procurement: compile technical and financial evidence while procuring/constructing the asset.
Available‑for‑use milestone: record the commissioning date for each property; your credit rate depends on whether the date falls in 2023–2033 or 2034.
Filing window: claim on your T2 or T3 return for the year the property became available for use. File by the statutory due date for that return.
Late information: CRA may accept late filing of the required information if submitted within one year after the return’s filing due date.
Processing times: routine assessments are communicated on your notice of assessment or reassessment; if selected for review, timelines depend on the complexity of the request and completeness of your responses.
Tips for a Successful Application
Elect into labour requirements early: set up prevailing wage and apprenticeship controls before work starts to avoid a reduced rate.
Document “available‑for‑use” precisely: maintain commissioning certificates, energization logs, and operations sign‑off records.
Map assets to categories: classify equipment accurately (e.g., solar PV modules, inverters, BESS, heat pumps, geothermal loops, SMR modules) and confirm eligibility for each.
Prove Canadian use and new status: evidence that the property is new and intended for exclusive use in Canada is essential.
Align partnership data: ensure T5013 slip amounts and Schedule 75 details reconcile across all members.
Avoid double‑claiming: do not claim CT and CCUS ITCs on the same property; use category‑level mapping to prevent conflicts.
Plan for recapture: keep a 10‑year asset tracker to flag conversions, exports, or dispositions.
Consider Class 43.1/43.2: coordinate ACCA with your CT ITC to optimize cash flow and tax outcomes.
Common Mistakes to Avoid
Missing or late labour election: failing to elect leads to a 10‑percentage‑point reduction; electing but not complying can trigger an addition to tax.
Using ineligible or previously used assets: property must be new and not previously acquired for use or lease.
Weak available‑for‑use evidence: unclear commissioning dates can jeopardize rates and timing of the claim.
Claiming multiple clean economy ITCs on the same asset: strictly prohibited.
Omitting key schedules and lines: not completing Schedule 75; failing to report the CT ITC on Schedule 31 line 155 and include it in T2 line 780; not completing Form T1098 for MFT‑REITs or field 881 on the T3.
Leasing rule missteps: lessee and lessor conditions must be met when the property is leased.
Partnership allocation errors: T5013 boxes 265–267 must be accurate and consistent with members’ filings.
Filing the required information more than one year late: CRA may not accept late information beyond the one‑year tolerance.
What Happens After You Apply
If your claim is accepted as filed: you will be notified on your notice of assessment or reassessment; no further action is required.
If your claim is selected for review: CRA may request documents, conduct meetings (virtual or on‑site), and assess both project and labour compliance. You will receive a written summary of findings. If changes are proposed, you generally have 30 days to respond before assessment or reassessment.
If you disagree with the decision: you may use the established objection and appeal processes under the Income Tax Act.
Recapture events: if, within 10 years, property is converted to non‑clean tech use, exported from Canada, or disposed of, a portion of the ITC may be recaptured. The recapture will not exceed the ITC originally associated with that property. Report recapture by the applicable due date.
Conclusion
Claiming the Clean Technology ITC requires accurate classification of eligible property, a clear available‑for‑use date, a deliberate labour election strategy, and precise tax filings. By preparing documentation early, completing Schedule 75 and the relevant return schedules or forms correctly (T2SCH31 for corporations; T1098 and T3 field 881 for MFT‑REITs), and monitoring assets for potential recapture, organizations can confidently access this federal refundable investment tax credit. As of December 1, 2025, the maximum rates remain up to 30% through 2033 and up to 15% in 2034, reduced by 10 percentage points if you do not elect to meet labour requirements.
