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Ontario Computer Animation and Special Effects Tax Credit (OCASE)
ON, Canada
Tax credit for animation and special effects work in Ontario
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|minCount
- grant_single|projectCostPercent
grant_single|deadlines
- grant_single|timelineUnspecified
grant_single|financingType
Tax Credits
grant_single|eligibleIndustries
- Arts, entertainment and recreation
grant_single|grantors
- Government of Ontario
- Ontario Creates
grant_single|status
grant_card_status|open
grant_single_labels|preview
Refundable tax credit of 18% on local Ontario labour costs related to the creation of computer animation and special effects for use in film and television.
grant_single_labels|terms_and_conditions
- The OCASE Tax Credit is refundable, meaning that the credit amount minus any Ontario taxes owed will be reimbursed to the qualifying corporation.
- Calculated as 18% of eligible Ontario labour expenditures incurred during the taxation year for computer animation and special effects activities.
- There is no cap on the total eligible Ontario labour expenditures that can be claimed.
- The tax credit is jointly administered by Ontario Creates and the Canada Revenue Agency (CRA).
- Payments can be processed via cheque or direct deposit by the CRA, contingent on any outstanding federal or Ontario taxes being settled.
- An application fee calculated as 0.15% of eligible labour expenditures is applied, with a minimum fee of $500 and a maximum of $10,000 per application.
- Additional fees apply for applications submitted more than 24 months after the claim year-end and for amended Certificates.
grant_single_labels|projects
- Designing digital animation or visual effects.
- Modelling for digital animation or visual effects.
- Rendering digital animation or visual effects.
- Lighting for digital animation or visual effects.
- Painting digital animation or visual effects.
- Animating digital animation or visual effects.
- Compositing digital animation or visual effects.
grant_single|admissibleProjectsExample
$ 13,500
Design and animation of ecological documentaries with advanced graphics
$ 16,200
Creation of motion capture animations for a video game
$ 18,000
Development of high-quality visual effects for an upcoming TV series
$ 13,500
Creation of 3D character models for an animated feature film
$ 18,000
Special effects creation for an indie film focusing on historical events
$ 9,900
Development of virtual reality environments for an educational platform
grant_single_labels|admissibility
- The applicant must be a Canadian corporation that is either Canadian-owned or foreign-owned.
- The corporation must have a permanent establishment in Ontario and must file an Ontario corporate tax return.
- The applicant can include animation or visual effects houses, post-production houses, and film and television production companies performing eligible computer animation and special effects activities.
- The production must be produced for commercial exploitation and not be in an excluded genre.
- The production must not receive financial support that would be contrary to public policy.
- For activities commencing on or after March 26, 2024, the qualifying corporation must incur a minimum of $25,000 in eligible Ontario labour expenditures for each film or television production claimed for the OCASE tax credit.
grant_eligibility_criteria|who_can_apply
- Animation companies.
- Visual Effects houses.
- Post-production companies.
- Film and television production companies.
- 3D Service Providers working under contract to the production's producer.
grant_eligibility_criteria|who_cannot_apply
- Corporations that do not have a permanent establishment in Ontario.
- Companies that are controlled directly or indirectly by one or more corporations exempt from tax under specific Ontario tax regulations.
- Corporations that do not perform eligible computer animation and special effects activities directly in support of eligible productions within Ontario.
- Productions or companies that operate in excluded genres such as news, current events, talk shows, game shows, sports events, reality television, pornography, and advertising, amongst others.
- Corporations primarily producing content for industrial, corporate, or institutional purposes.
- Productions which are contrary to public policy in terms of financial support.
grant_eligibility_criteria|eligible_expenses
- Salaries and wages paid to employees directly attributable to eligible activities.
- Remuneration paid to freelancers who are individuals, partnerships, or arm's-length incorporated individuals.
- Amounts must be paid to Ontario residents who report to a permanent establishment of the qualifying corporation in Ontario.
- Labour expenditures must be incurred in the taxation year for which they are claimed and paid in the taxation year or within 60 days after the end of the taxation year.
grant_eligibility_criteria|zone
- Ontario, Canada.
grant_single_labels|criteria
- The OCASE Tax Credit is based on eligible Ontario labour expenditures incurred by a qualifying corporation during a taxation year with respect to eligible computer animation and special effects activities. - The tax credit amount is calculated as 18% of the eligible Ontario labour expenditures incurred by the qualifying corporation. - Eligible productions must be created for commercial exploitation and have received an OFTTC or OPSTC certificate to be eligible for the OCASE tax credit. - Eligible activities include designing, modelling, rendering, lighting, painting, animating, and compositing directly in support of eligible animation or visual effects. - Qualifying labour expenditures include salaries, wages, and payments to freelancers for eligible activities carried out in Ontario. - The OCASE Tax Credit is administered jointly by Ontario Creates and the Canada Revenue Agency. - Application for the Certificate of Eligibility is made to Ontario Creates, which is then filed with the Canada Revenue Agency for claiming the tax credit. - Residency status is important in determining eligible labour expenditures for the tax credit. - Assistance in the form of grants, subsidies, and forgivable loans may grind the tax credit amount. - Crowdfunding may be considered assistance depending on the model used. - If a product/production is found to be ineligible, the applicant may be required to withdraw it from review. - Applicants can appeal the amount of tax credit received through the CRA's objections and appeals process. - For more information or assistance, applicants can contact the tax credit department at Ontario Creates.
grant_single_labels|register
- Step 1: Determine Eligibility and Prepare Documents
- Verify that your corporation is a qualifying corporation as per OCASE guidelines.
- Ensure all eligible computer animation and special effects activities are completed.
- Gather necessary documentation including, but not limited to, incorporation documents, contracts, production schedules, and detailed descriptions of the animation or visual effects process.
- Step 2: Calculate Eligible Expenditures
- Calculate 18% of the eligible Ontario labour expenditures incurred for the relevant taxation year.
- Prepare a breakdown of eligible Ontario labour expenditures for each production.
- Step 3: Complete Application Form
- Access the Ontario Creates Online Application Portal (OAP) to start your application.
- Fill out the OCASE Tax Credit Application, ensuring all sections are complete and accurate.
- Upload all required supporting documents through the OAP.
- Step 4: Pay Administration Fee
- Calculate the administration fee based on 0.15% of eligible expenditures, with a minimum of $500 and a maximum of $10,000.
- Submit the administration fee via Interac e-Transfer or another approved payment method.
- Step 5: Submit Application
- Review your application for completeness and accuracy.
- Submit your completed application before the end of the corporation’s taxation year.
- Step 6: Await and Respond to Communication
- Check for any correspondence from Ontario Creates regarding your application status.
- Provide additional information or documentation if requested.
- Monitor CRA assessments and refund status.
- Step 7: Filing with CRA
- Once you receive the Certificate of Eligibility, submit it with your corporate tax return to the CRA.
- Use CRA’s online tools for secure submission and confirmation if available.
grant_single_labels|otherInfo
- The OCASE Tax Credit calculation is set at 18% of eligible Ontario labour expenditures.
- The Ontario Creates agency and the Canada Revenue Agency jointly administer the OCASE Tax Credit.
- Production companies can be either Canadian or foreign-owned but must operate a permanent establishment in Ontario.
- There is no cap on eligible Ontario labour expenditures for which the tax credit can be claimed.
- The legislative changes effective from May 16, 2024, aim to simplify the tax credit process and untether it from other film and television tax credits.
- Applicants are required to submit a Certificate of Eligibility with their corporate tax return to claim the tax credit.
- Residency of employees or freelancers affects eligibility for labour expenditures.
- COVID-19 related costs such as health and safety measures are not eligible for the tax credit unless specified.
- Productions require a minimum labour expenditure threshold of $25,000 in Ontario to be eligible for the OCASE Tax Credit.
- The tax credit rules exclude productions in certain genres including news, sports, talk shows, and advertising from eligibility.
- Crowdfunding may be treated as assistance, potentially affecting the tax credit if no exchange of benefits occurs.
- Applications can be made to Ontario Creates post the fiscal year-end of the company, based on actual expenditures.
- A non-refundable administration fee is applied, calculated as 0.15% of eligible expenditures, with a minimum of $500 and a maximum of $10,000 per application.
- There is an additional filing fee for late applications submitted more than 24 months after the year-end.
- Documents such as financing plans, contracts, and detailed expenditure breakdowns are required for application submission.
grant_single_labels|contact
taxcredits@ontariocreates.ca
416-642-6659
