
Apprenticeship Job Creation Tax Credit (AJCTC)
Last Update: June 26, 2025
Canada
Tax credit for hiring apprentices
Apprenticeship Job Creation Tax Credit (AJCTC) at a glance
Eligible Funding
- Max. $2,000
- Up to 10% of project cost
Timeline
- Open Date : November 14, 2019
Financing Type
Tax Credits
Eligible Industries
- Construction
- Manufacturing
- Transportation and warehousing
Grant Providers
- Canada Revenue Agency (CRA)
- Government of Canada
Status
Open
Overview of the Apprenticeship Job Creation Tax Credit (AJCTC) program
Get a non-refundable tax credit equal to 10% of the salaries and wages paid to your apprentices from a Red Seal Trade, up to a maximum of $2,000/year for each apprentice.
Financing terms and conditions
- Non-refundable tax credit equal to 10% of eligible salaries and wages paid to each eligible apprentice.
- Maximum claimable amount of $2,000 per year for each eligible apprentice.
- Unused credits can be carried back 3 years and carried forward 20 years.
- If multiple related employers employ the same apprentice, the $2,000 annual limit applies collectively and must be allocated between them.
Eligible projects & activities
- Hiring and employing eligible apprentices in prescribed trades as part of a registered apprenticeship program.
Examples of admissible projects:
$ 2,000
Launching a Red Seal electrical apprenticeship program
$ 2,000
Implementing a new welding program to train Red Seal apprentices
$ 2,000
Setting up an HVAC apprenticeship program for Red Seal certification
$ 2,000
Developing an automotive service technician apprenticeship program for Red Seal certification
$ 2,000
Creating a carpentry apprenticeship program for Red Seal certification
$ 2,000
Establishing a culinary apprenticeship program for Red Seal chefs
Eligibility criteria of the Apprenticeship Job Creation Tax Credit (AJCTC) program
- The employer must hire an eligible apprentice working in a prescribed trade.
- The apprentice must be in the first two years of their apprenticeship contract.
- The apprenticeship contract must be registered with a federal, provincial, or territorial government under an apprenticeship program that certifies or licenses individuals in the trade.
Who is eligible?
- Employers who hire apprentices working in prescribed trades
- Companies employing individuals in trades listed as Red Seal Trades
Eligible expenses
- Salaries and wages payable to eligible apprentices employed in a prescribed trade during the first two years of their registered apprenticeship contract.
Eligible geographic areas
- Employers across Canada, including all provinces and territories, provided the apprenticeship contract is registered with a federal, provincial, or territorial government under an eligible program.
How to apply to the Apprenticeship Job Creation Tax Credit (AJCTC) program
1
Verify Apprentice Eligibility
- Ensure the apprentice is working in a prescribed trade listed as a Red Seal Trade.
- Confirm the apprenticeship is in the first two years of their contract.
- Make sure the apprenticeship contract is registered with the federal, provincial, or territorial government.
2
Calculate Eligible Salaries and Wages
- Determine the total eligible salaries and wages payable to the eligible apprentice.
- Calculate 10% of these salaries and wages to find the eligible tax credit.
- Ensure the credit does not exceed $2,000 per apprentice per year.
3
Prepare Tax Documents for Credits
- Gather necessary documentation including salary records and the apprenticeship contract.
- Complete the required Form T2038(IND) for individuals or T2SCH31 for corporations.
- Ensure accuracy and completion before filing.
4
Submit on Income Tax Return
- Claim the AJCTC on your individual or corporate income tax return.
- Input the calculated credit on line 41200 of your tax return.
- Review the application for accuracy and completeness before submission.
5
Await Confirmation and Processing
- Submit your tax return through the appropriate federal channels, either electronically or by mail.
- Keep a copy of the submitted tax return and related documents for your records.
- Monitor communications for confirmation of processing and credit application.
Additional information
- Any unused portion of the tax credit can be carried back three years or carried forward twenty years.
- If more than one related employer employs the same apprentice, special allocation rules ensure the $2,000 maximum is shared appropriately.
- The AJCTC can be claimed on individual or corporate tax returns using the appropriate forms (T2038(IND) for individuals and T2SCH31 for corporations).
- A list of prescribed trades eligible for the credit is available through the Red Seal Program.
Apply to this program

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