Clean Technology Manufacturing (CTM) Investment Tax Credit (ITC)

Who is eligible?

• Canadian corporations subject to income tax
• Canadian corporations that are members of a partnership
• Companies involved in clean technology manufacturing or processing
• Companies involved in critical mineral extraction and processing

Eligible expenses

• Capital cost of acquiring eligible property, including:
• Legal, accounting, engineering, or other fees incurred to acquire the property
• Site preparation, delivery, installation, and testing costs or other costs to bring the property into service
• For self-constructed property: material, labour, and overhead costs reasonably attributable to the property (excluding any notional profit)

• The Clean Technology Manufacturing (CTM) Investment Tax Credit is administered by the Canada Revenue Agency (CRA), which provides oversight, audit, and compliance activities for claimants.
• Legislative amendments affecting Clean Economy ITCs have been proposed and, if enacted, may apply retroactively; applicants should consult the latest updates from the federal government to ensure compliance with current and pending requirements.
• The CTM ITC is available for eligible goods acquired and put into service between January 1, 2024, and December 31, 2034.
• The CTM ITC rate decreases over time: 30% through 2031, 20% in 2032, 10% in 2033, and 5% in 2034.
• Only one Clean Economy ITC can typically be claimed for the same property; however, multiple ITCs may be claimed for a single project if the project includes different types of eligible assets.
• If part of the capital cost is unpaid 180 days after the end of the corporation’s taxation year in which the asset is put into service, that portion is excluded from the capital cost calculation until payment is made.
• Government or non-government assistance received (or expected to be received) related to an eligible asset must be deducted from the capital cost for ITC calculation purposes; if such assistance is later repaid or not received, it may be added back.