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Federal foreign non-business income tax credit
Reduces Canadian tax on foreign non-business income
Last Update: April 9, 2026
Funding available
Varies by project
Timeline
- Open continuously
Location
Canada
Overview
This program reduces Part I tax for corporations claiming a federal foreign non-business income tax credit. It applies to foreign non-business income such as dividends, interest, and capital gains taxed abroad, and requires Schedule 21.
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Opportunity Score
Moderate potential, but conditions must align.
At a glance
Funding available
Financing goals
- No objectives are currently available
Eligible Funding
- Varies by project
Timeline
- Open continuously
Eligible candidates
Eligible Industries
- All industries
Location
- Canada
Legal structures
- For-profit business
Annual revenue
- All revenue ranges
Organisation size
- All organization sizes
Audience
- Canadians
Next Steps
1
Determine your project
2
Validate your eligibility
Documents Needed
- Schedule 21 completed for each country.
- Supporting proof of foreign income earned.
- Proof of foreign tax paid.
- Translations for any foreign-language documents, if applicable.
Eligibility
Who is eligible?
- Canadian-resident corporations.
- Authorized foreign banks.
Who is not eligible
- Corporations with only treaty-exempt foreign income for the claim.
- Corporations claiming foreign taxes on foreign business income under this credit.
Ineligible Costs and Activities
- Foreign tax on treaty-exempt income.
- Foreign tax on dividends from foreign affiliates.
- Foreign tax on income from a foreign business.
- Taxes related to property expected to produce no profit.
Eligible geographic areas
- Canada
Processing and Agreement
- Calculate the credit using Schedule 21.
- Complete a separate calculation for each foreign country.
- Enter the total allowable credit on the T2 return.
- Attach supporting schedules and documents with the return.
Additional information
- The credit is calculated separately for each foreign country.
- Foreign taxes related to treaty-exempt income are not included.
- Unused foreign business income tax credits may be carried back or forward under the schedule rules.
Frequently Asked Questions about the Federal foreign non-business income tax credit Program
Here are answers to the most common questions about the Federal foreign non-business income tax credit. This section explains what the program is, how much funding is available, eligibility requirements, application deadlines, and other important details to help you determine if this grant is right for your business.
What is the Federal foreign non-business income tax credit?
This program reduces Part I tax for corporations claiming a federal foreign non-business income tax credit. It applies to foreign non-business income such as dividends, interest, and capital gains taxed abroad, and requires Schedule 21.
Who is eligible for the Federal foreign non-business income tax credit program?
To be eligible for the Federal foreign non-business income tax credit program, you must:
Canadian-resident corporation.
Foreign non-business income taxed abroad.
Income and tax calculated by country.
Who can I contact for more information about the Federal foreign non-business income tax credit?
You can contact Canada Revenue Agency (CRA).
Where is the Federal foreign non-business income tax credit available?
The Federal foreign non-business income tax credit program is available across Canada.
Is the Federal foreign non-business income tax credit a grant, loan, or tax credit?
Federal foreign non-business income tax credit is a Tax Credits
Who are the financial supporters of the Federal foreign non-business income tax credit?
Federal foreign non-business income tax credit is funded by Canada Revenue Agency (CRA)