Small Business Investor Tax Credit Program
NB, Canada
Tax credit to drive New Brunswick business investment
grant_single_labels|summary
grant_single|eligibleFinancing
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- grant_single|timelineUnspecified
grant_single|financingType
Tax Credits
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grant_single|grantors
- Department of Finance and Treasury Board (NB)
- Government of New Brunswick
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grant_card_status|open
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Tax credit of 50% on investments up to $250,000 for individual investors and a tax credit of 15% on investments up to $500,000 for corporations and trusts on eligible investments in your New Brunswick small business.
grant_single_labels|projects
This grant is available to businesses and community economic development corporations or associations that operate in the province of New Brunswick, Canada. The program aims to enhance capital accessibility within this specific geographical area.
- Companies located in the province of New Brunswick.
grant_single|admissibleProjectsExample
$400,000
Development of an online education platform by Acadienne Educators Collective
$350,000
Launch of a new artisan craft marketplace by Maritimes Artisans Guild
$300,000
Renovation of the Maple Leaf Bakery for improving production efficiency and expanding product lines
$450,000
Development of a mobile healthcare clinic by HealthConnect Inc
$600,000
Expansion of GreenTech Solutions for developing sustainable energy technologies
$250,000
Creation of a local organic farming initiative by Sunrise Cooperative
grant_single_labels|admissibility
Eligibility for the Small Business Investor Tax Credit program requires that applicant corporations meet specified criteria to qualify.
- The corporation must be a private company.
- The corporation must be incorporated or registered to carry on business in New Brunswick.
- The corporation must have authorized capital consisting of shares without par value.
- The corporation must have net tangible assets less than $40 million, including associated corporations.
- All, or substantially all, of the corporation’s assets and income must be used to generate active business income in New Brunswick.
- The corporation must pay at least 75% of its wages and salaries to individuals who are residents of New Brunswick in each of the four years after registration, unless it exports more than 50% of its goods and services outside of N.B., in which case the requirement is for 50%.
- The corporation must not provide loans or financial assistance to purchase shares included in a specified issue under the program.
- Issued shares must not be purchased by investors who disposed of shares of the corporation after Dec. 10, 2002, and before the proposed share issuance.
- Shares to be issued must be newly issued, fully paid shares of the corporation's capital stock registered under the Small Business Investor Tax Credit Act and not include a replacement share.
grant_eligibility_criteria|who_can_apply
Eligible applicants include both individual and corporate investors who wish to invest in small businesses or community economic development corporations or associations in New Brunswick. Individual investors must be at least 19 years old and New Brunswick residents, while corporate investors must have a permanent establishment in New Brunswick.
grant_eligibility_criteria|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.
grant_eligibility_criteria|zone
The eligible geographic zone for this grant is the province of New Brunswick.
- New Brunswick
grant_single_labels|criteria
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.
grant_single_labels|register
Here are the steps to submit an application for the Small Business Investor Tax Credit Program:
- Step 1: Application for Certificate of Registration
- Corporations/Community economic development corporations or associations must complete an application for a Certificate of Registration.
- For corporations, include an investment plan, previous tax returns, financial statements, share registry, instrument of incorporation, investor certifications, and director's declarations.
- For community economic development corporations/associations, submit a community economic development plan, previous tax returns, financial statements, share registry, instrument of incorporation, investor certifications, and director's declarations.
- Pay the application fee of $100.
- Submit the application to the New Brunswick Department of Finance.
- Step 2: Application for a Tax Credit Certificate
- Complete the Application for an Investor Tax Credit Certificate within 30 days of the sale of eligible shares.
- Provide proof of sale and required investor information to the New Brunswick Department of Finance.
- Pay the application fee of $25 per investor tax credit certificate.
- Step 3: Attach Tax Credit Certificate to Tax Returns
- Ensure individual, corporation, and trust investors attach the Tax Credit Certificates to their personal or corporate income tax returns.
- Claim the provincial income tax reduction as applicable.
- Step 4: Annual Reporting
- Submit an annual return detailing your financial statements and status of shareholdings within the four-year holding period.
- Ensure compliance with the Small Business Investor Tax Credit Program requirements and the correct use of raised capital.
- Step 5: Compliance and Monitoring
- Ensure that the shares are held for at least four years to avoid repayment of the tax credit.
- Maintain accurate records and provide necessary information to relevant departments to confirm compliance with program regulations.
- Step 6: Contact Information
- For further inquiries, contact the Finance and Treasury Board via phone, fax, or online through the provided contact details.
grant_single_labels|otherInfo
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.
Apply to this program
Empowering New Brunswick's Small Businesses with Tax Incentives
The New Brunswick Small Business Investor Tax Credit program offers significant tax benefits to individual and corporate investors who invest in small businesses and community economic development corporations within the province. These incentives are designed to increase access to capital and support economic growth in New Brunswick.
Exploring the New Brunswick Small Business Investor Tax Credit Program
The Small Business Investor Tax Credit program in New Brunswick serves as a powerful tool for galvanizing investment in the province’s burgeoning small business sector. By providing a 50% non-refundable personal income tax credit for individual investors and a 15% non-refundable corporate income tax credit for corporations and trusts, the program encourages both local residents and businesses to inject capital into local enterprises. Specifically, individuals can claim up to $125,000 per year on investments of up to $250,000, while corporations and trusts can claim up to $75,000 annually for investments up to $500,000.
This tax credit initiative not only aims to facilitate the growth of New Brunswick's small businesses but also fosters community empowerment through support for Community Economic Development Corporations (CEDCs) and associations. The program is structured to ensure funds are primarily utilized for active business engagements, thereby keeping the local economy vibrant and sustainable. By limiting investment eligibility to New Brunswick residents and requiring corporations to have tangible connections to the province, the program ensures that the economic benefits remain within the local community.
The application process involves a meticulous review by the New Brunswick Department of Finance, where potential applicants must submit comprehensive investment or community economic development plans. For corporations, these plans stipulate the intended use of the raised capital, demonstrating how it will benefit operations within New Brunswick. Similarly, CEDCs must outline how their initiatives will bolster the community’s economy. This structured approach ensures investments are directed towards viable, impactful business opportunities that comply with the regulations set by the Small Business Investor Tax Credit Act.
Upon approval, eligible businesses receive a Certificate of Registration allowing them to issue shares up to a pre-determined value. This phase is crucial as it establishes trust and credibility, providing assurance to investors about the legitimacy and potential of the enterprise. Businesses then have 90 days to complete share transactions with listed investors.
Investors are required to hold shares for a minimum of four years to qualify for the tax credit, fostering long-term engagements rather than short-term speculative investments. This holding period is a strategic move to stabilize and provide ongoing support to the supported entities. The program also sets a strict framework around the use of raised capital, prohibiting its use for purposes such as lending or investments outside of New Brunswick, further safeguarding the program's objectives of enhancing the local business landscape.
This program represents a compelling opportunity for both investors and New Brunswick’s small businesses. It not only drives capital into vital sectors but also strengthens the province’s economic fabric. By participating, investors have the dual benefit of financial returns via tax credits and contributing to the sustainable development of their communities. The program's comprehensive design thus not only incentivizes investments but also fortifies the province’s commitment to fostering a robust, self-sufficient economic environment.
