Small Business Investor Tax Credit Program

• Application for registration form
• Investment plan or community economic development plan
• Investor statements and director statements
• Annual return form

Who is eligible?

Eligible expenses

The Small Business Investor Tax Credit in New Brunswick supports diverse projects that enhance economic development and investment in local businesses. Eligible projects are centered on the strategic use of funds to bolster business activities and community growth.

• Raising capital for active business operations in New Brunswick.
• Implementing economic development strategies within defined communities.
• Issuance of shares for supporting business expansion plans.
• Promotion of equity financing opportunities for local investors.
• Establishing administrative support and governance for community economic development organizations.

Eligible geographic areas

This program's eligibility with respect to geographical areas is inherently tied to entities operating or residing within the province of New Brunswick. The focus is on fostering economic development within its communities.

• Businesses that are incorporated or registered to carry on business in New Brunswick.
• Individuals who are residents of New Brunswick.
• Community Economic Development Corporations or Associations located in New Brunswick.

The evaluation and selection of projects for the Small Business Investor Tax Credit Program focus on the adequacy of the investment or community economic development plans and the compliance of the submission with statutory requirements. However, no specific point scores are allocated in the provided information.

• Assessment of the investment plan or community economic development plan's alignment with the spirit and intent of the Small Business Investor Tax Credit Act and Regulations.
• Evaluation of how the proposed use of capital will benefit the operations within the defined community or corporation located in New Brunswick.
• Verification of eligibility criteria for the applicant corporation or community economic development corporation or association, including incorporation, registration, and operational criteria.
• Compliance with the mandated use of funds, such as restrictions on lending, purchasing shares, or investing outside New Brunswick.
• Ensuring the issuance of newly issued, fully paid shares without inclusion of replacement shares.
• Compliance with shareholding and capital requirements, such as minimum investment amounts and holding periods.

• Step 1: Register the business
  • Complete the application for a Certificate of Registration.
  • Submit the required plan and supporting documents to the New Brunswick Department of Finance.
• Step 2: Request investor tax credit certificates
  • After eligible shares are sold, submit proof of sale and investor information within 30 days.
  • Apply for the Tax Credit Certificate for each eligible investor.
• Step 3: File annual returns
  • Submit the annual return and required compliance information during the holding period.

• The Department of Finance reviews the application and issues a Certificate of Registration if approved.
• Approved businesses may then issue eligible shares up to the specified value and date.
• After eligible shares are sold, the business must submit proof of sale and investor information within 30 days.
• The Minister of Finance issues a Tax Credit Certificate for approved share purchases.
• During the four-year holding period, annual returns and other compliance information may be required.

The application process involves multiple steps, fees, and compliance regulations that must be met to qualify for the Small Business Investor Tax Credit. Additionally, there are specific criteria for both corporations and community economic development corporations or associations.

• A fee of $100 applies to each application for registration under the program.
• A fee of $25 applies to each investor tax credit certificate requested.
• Funds raised cannot be used for lending, purchasing shares of any other person, or investing outside New Brunswick, among other restrictions.
• An investor must hold the shares for at least four years, or the tax credit will need to be repaid.
• The total investment by an individual investor must not be less than $1,000, and by a corporation and trust investor not less than $50,000.
• Eligible investments do not include shares issued with the main intention of claiming the tax credit.
• If an investor redeems or disposes of shares before the four-year period, they must repay the tax credit amount, including interest, unless the shareholder has passed away.
• During the four-year holding period, the applicant must file annual returns and provide detailed status reports and financial statements.
• The program does not guarantee the value of any shares issued and does not express opinions on the financial condition of the participating entities.