How much funding can be received?

Funds up to 25% of admissible expenses.

What is the deadline to apply?

The deadline to apply is not specified.

Who are the financial supporters of the Investment and innovation tax credit (IITC)?

Investment and innovation tax credit (IITC) is funded by Revenu Québec

What are Investment and innovation tax credit (IITC)'s eligibility criterias?

Have an establishment in Quebec and operate a business there. Have made eligible acquisitions (manufacturing and processing equipment, computer systems, and enterprise resource planning software). Investments must be related to the company's activities.

Investment and innovation tax credit (IITC)

Last Update: May 16, 2025

QC, Canada

Tax credit for investment and innovation in Quebec

Investment and innovation tax credit (IITC) at a glance

Eligible Funding

Up to 25% of project cost

Timeline

Continuous Intakes

Financing Type

Tax Credits

Eligible Industries

All industries

Grant Providers

Revenu Québec

Status

Open

Overview of the Investment and innovation tax credit (IITC) program

The Quebec Investment and Innovation Tax Credit offers a variable credit rate of up to 25% for businesses acquiring eligible assets, depending on the region's economic vitality. The program aims to support the acquisition of new manufacturing and processing equipment, information technology equipment, or management software primarily used in Quebec.

Financing terms and conditions

The tax credit rate for eligible expenses varies according to the acquisition date and the economic vitality of the territory where the asset is primarily used: up to 40% for territories with low economic vitality, 30% for intermediate, and 20% for high, for acquisitions between March 26, 2021, and December 31, 2023.
For acquisitions after December 31, 2023, the maximum tax credit amounts are 25% (low vitality), 20% (intermediate), and 15% (high) economic vitality territories.
An exclusion threshold applies to eligible assets per year: $5,000 for category 50 assets or eligible management software, and $12,500 for other cases.

Eligible projects & activities

Acquisition of eligible manufacturing and processing equipment (Category 53 under the Regulation respecting the Taxation Act).
Acquisition of universal electronic data processing equipment or related operating software (Category 50 under the Regulation respecting the Taxation Act).
Acquisition of equipment primarily used for processing minerals extracted from resources located outside Canada (Category 43 under the Regulation respecting the Taxation Act).
Acquisition of eligible management software packages (Category 12 under the Regulation respecting the Taxation Act).
Acquisition of equipment primarily used for smelting, refining, or hydrometallurgy of minerals, except those from gold or silver mines extracted from a resource located in Canada.

Examples of admissible projects:

$ 125,000

Introduction of advanced automation technology for manufacturing

$ 90,000

Acquisition of data processing equipment to upgrade IT infrastructure

$ 60,000

Investing in an ERP software system to streamline operations

$ 75,000

Acquiring new CNC machines for precision manufacturing with advanced features

$ 100,000

Upgrading mineral processing equipment at the mining facility

$ 40,000

Procurement of customer relationship management software for enhanced client handling

Eligibility criteria of the Investment and innovation tax credit (IITC) program

The applicant must be a corporation with an establishment in Quebec and must be carrying on business there during its taxation year.
The applicant cannot be a tax-exempt corporation.
Excluded entities: Crown corporations or their wholly controlled subsidiaries, aluminum production companies, and oil refining companies.
If the asset is acquired by a partnership, the partnership must meet eligibility conditions and the credit will be granted to its corporate members.

Who is eligible?

Corporations with an establishment in Quebec operating a business during the tax year
Partnerships acquiring eligible property, with members who are eligible corporations

Who is not eligible

Companies that are exempt from tax.
Crown corporations or subsidiaries wholly controlled by such corporations.
Aluminum production companies.
Petroleum refining companies.

Eligible expenses

Capital costs for the acquisition of a "specified property" (bien déterminé), including:
Manufacturing and processing equipment (category 53 of Schedule B of the Taxation Act Regulations).
General-purpose electronic data processing equipment and related operating software (category 50 of Schedule B).
Eligible management software package (category 12 of Schedule B).
Equipment used primarily for the processing of ore extracted from mineral resources located outside Canada (category 43 of Schedule B).
Equipment used primarily for smelting, refining, or hydrometallurgical activities involving ores (excluding gold or silver) extracted from mineral resources located in Canada.

Eligible geographic areas

Companies with an establishment and business operations in Quebec.
Specific credit rates apply depending on whether the asset is primarily used in areas of low, intermediate, or high economic vitality within Quebec.

How to apply to the Investment and innovation tax credit (IITC) program

Identify the grant program

Search for grant programs that match the project.
Analyze the eligibility criteria to ensure eligibility.
Take note of submission deadlines.

Prepare the required documentation

Compile all necessary financial and administrative documents.
Write a detailed project plan including objectives, methodology, and impact.
Obtain letters of support or commitment if needed.

Write the grant application

Follow the guidelines provided by the program for writing.
Use clear and precise terms and language.
Include all requested information without forgetting the attachments.

Submit the request

Re-read and check the request to ensure there are no errors.
Send the request by the specified method (online, by email, or by post).
Keep a copy of the submitted request for personal records.

Track the status of the request

Contact the responsible organization if no response is received after a reasonable delay.
Inquire about the upcoming deadlines to be met (possibility of appeal or request for additional information).
Prepare a plan for administrative follow-up once the grant is accepted.

Additional information

An extension of the deadline for submitting the application form is planned, allowing the submission of form CO-1029.8.36.II until June 30, 2024, or within 183 days following a notice of assessment that refused the credit for a prior year.
The eligible property must be used in Quebec for a minimum period of 730 consecutive days, except in cases of force majeure (loss, theft, major breakage, accidental destruction, or obsolescence).
Expenses related to a specific property incurred with persons having a dependency relationship with the corporation or the corporation being a member of a partnership are not eligible in the calculation of the credit.
The acquisition as part of a joint venture leads to a calculation of the exclusion threshold proportional to the share of the business in the specific property.