Tax credit for design in Quebec
QC, Canada
Tax credit for an in-house design activity
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|maxCount
- grant_single|projectCostPercent
grant_single|deadlines
- grant_single|openingDateNovember 14, 2019
grant_single|financingType
Tax Credits
grant_single|eligibleIndustries
- grant_single|allIndustries
grant_single|grantors
- Gouvernement du Québec
- Revenu Québec
grant_single|status
grant_card_status|open
grant_single_labels|preview
Tax credit of 12% to 24% on the cost of in-house design activities. The maximum eligible salary for a year is $60,000 for a designer and $40,000 for a pattern maker.
grant_single_labels|projects
The eligible projects or activities for this grant involve conducting qualifying design activities internally within the company.
- Engaging in design activities that have received an eligibility certificate from the Minister of Economy, Innovation, and Energy
- Paying salaries to eligible designers and pattern makers with a qualification certificate
grant_single|admissibleProjectsExample
$60,000
Montreal
Developing sustainable packaging designs for e-commerce using skilled designers and pattern makers
$60,000
Quebec
Creating adaptive clothing designs for people with disabilities using expert designers and pattern makers
$60,000
Vancouver
Developing an eco-friendly urban furniture line employing experienced designers and pattern makers
$60,000
Calgary
Revamping the user interface for an educational app with specialized designers and pattern makers
$60,000
Ottawa
Designing a new product line for an organic skincare brand using qualified designers and pattern makers
$60,000
Toronto
Creating a fashion collection inspired by indigenous art with professional designers and pattern makers
grant_single_labels|admissibility
To be eligible for this tax credit, a company must hold a certificate of eligibility issued by the Minister of Economy, Innovation, and Energy for a design activity. Additionally, they must meet specific conditions regarding their establishment in Quebec, annual revenue, and the nature of the company.
- Have an establishment in Quebec.
- Operate a business in Quebec with a gross revenue of at least $150,000 per year.
- Hold a certificate of eligibility for a design activity issued by the Minister of Economy, Innovation, and Energy.
- Must not be an exempt corporation.
- Must not be a Crown corporation or its controlled subsidiary.
- If a member of a partnership, can claim the tax credit for their share of expenses incurred by the partnership.
grant_eligibility_criteria|who_can_apply
Eligible companies for this grant include those that operate an establishment in Quebec, have a gross revenue of at least $150,000 per year, and hold a certification of eligibility for a design activity. Specific types of companies are excluded, such as tax-exempt entities and Crown corporations.
- Operate an establishment in Quebec
- Gross revenue of at least $150,000 per year
- Hold a certification of eligibility for a design activity
- Not tax-exempt
- Not a Crown corporation or its wholly controlled subsidiary
grant_eligibility_criteria|who_cannot_apply
There are specific types of companies that are not eligible for this grant.
- A company that is exempt from tax.
- A Crown corporation or a wholly controlled subsidiary of such a corporation.
grant_eligibility_criteria|eligible_expenses
Eligible expenses for this grant include salaries of designers and patronists who meet specific criteria.
- Salaries of eligible designers (maximum $60,000 per year)
- Salaries of eligible patronists (maximum $40,000 per year)
grant_eligibility_criteria|zone
The eligible geographic zone for this grant is the province of Quebec in Canada.
- Must have an establishment in Quebec
- Must operate a business with a gross income of at least $150,000 per year
- Salaries must be paid to eligible designers or patternmakers who work at one of the company’s establishments in Quebec
grant_single_labels|criteria
There are evaluation and selection criteria for this grant. The company must meet specific conditions and hold a valid eligibility certificate. The evaluation and selection criteria include:
- Having an establishment in Quebec and operating a business with a gross revenue of at least $150,000 per year
- Holding an eligibility certificate related to a design activity issued by the Minister of Economy, Innovation, and Energy
grant_single_labels|register
- Step 1: Ensure your company meets the eligibility criteria
- Your company must have an establishment in Quebec.
- Your company must be operating a business with a gross revenue of at least $150,000 per year.
- Your company must not be exempt from tax or a Crown corporation or a wholly controlled subsidiary of such a corporation.
- Step 2: Obtain an eligibility certificate from the Minister of Economy, Innovation, and Energy
- Apply for an eligibility certificate regarding a design activity.
- Step 3: Identify eligible salaries
- Ensure that the designers and patternmakers are eligible and have a qualification certificate from the Minister of Economy, Innovation, and Energy.
- Calculate the eligible salary considering the maximums specified ($60,000 for designers, $40,000 for patternmakers).
- Ensure that the eligible employees are working at one of the establishments located in Quebec.
- Step 4: Submit the tax credit application
- Prepare the necessary documentation and calculations regarding the eligible salaries.
- Submit the application through the appropriate tax filing for the company’s fiscal year.
grant_single_labels|otherInfo
The grant provides financial support for companies engaging in internal design activities, with specific eligibility requirements and varying tax credit rates based on the company's total assets.
- The credit is available for eligible corporates with a gross income of at least $150,000 per year.
- The company must hold a certificate of eligibility issued by the Minister of Economy, Innovation, and Energy for the design activity.
- Salaries for designers and pattern makers must not exceed $60,000 and $40,000 respectively in a year to be eligible.
- Some companies, such as tax-exempt corporations or Crown corporations and their wholly-owned subsidiaries, are ineligible.
- Companies that are members of a partnership may also apply for the credit for their share of expenses incurred by the partnership.
- The credit rate is 24% for companies with total assets up to $50 million, 12% for those with assets of $75 million or more, and varies between 12% and 24% for assets between $50 million to $75 million.
Apply to this program
Tax Credit for In-House Design Activities
A company in Quebec engaged in design activities may qualify for a tax credit on eligible wages paid to certified designers or pattern makers. Depending on the company's total assets, the tax credit rate ranges between 12% and 24%.
Understanding Quebec's Tax Credit for In-House Design Activities
In an effort to bolster the economy and support businesses engaged in innovative and creative endeavors, the Quebec government introduced a tax credit for companies that conduct design activities in-house. This targeted initiative, known as the Tax Credit for the Realization of an Activity of Design Internally, aims to provide financial relief and encourage businesses to maintain or increase their design-related activities within Quebec. This article will delve into the eligibility criteria, rates, and benefits of this tax credit, offering a comprehensive guide for companies looking to leverage this opportunity.
Eligibility Criteria
To qualify for the tax credit, a company must meet specific criteria:
- Location and Operation: The company must have an establishment in Quebec and actively operate a business there, generating a minimum annual gross income of $150,000.
- Attestation of Eligibility: The business must hold an attestation of eligibility for a design activity issued by the Minister of Economy, Innovation, and Energy.
- Non-Exempt Status: Companies exempt from tax, Crown corporations, or wholly-owned subsidiaries of Crown corporations are not eligible.
- Society Membership: If a company is a member of a partnership (or an intermediary that is part of a partnership), it can claim the tax credit for its share of expenses incurred by the partnership.
Determining the Tax Credit Rate
The percentage of the tax credit a business can claim depends on its total assets, including the assets of any associated companies:
- Assets ≤ $50 million: 24%
- Assets ≥ $75 million: 12%
- Assets between $50 million and $75 million: A variable rate between 12% and 24%.
Qualified Wages and Eligible Personnel
The tax credit applies to wages paid to eligible designers or pattern makers. The maximum annual qualifying salary is $60,000 for a designer and $40,000 for a pattern maker. Eligible personnel must hold a certification from the Minister of Economy, Innovation, and Energy and must work at one of the company’s establishments in Quebec.
Steps to Apply for the Tax Credit
1. Obtain an Attestation of Eligibility
The first step involves securing an attestation of eligibility for the design activity from the Minister of Economy, Innovation, and Energy. This document confirms that the design activities qualify for the tax credit.
2. Verify Eligible Wages and Personnel
Ensure that the wages paid are to certified designers or pattern makers who meet the eligibility criteria. Maintain detailed records of the salaries and the work performed.
3. Calculate the Credit
Determine the total assets of the company to establish the applicable tax credit rate. Calculate the eligible wages and apply the appropriate percentage to ascertain the credit amount.
4. File the Claim
Include the calculated tax credit in the company’s tax return. Provide the necessary documentation, including the attestation of eligibility and proof of qualified wages.
Benefits of the Tax Credit
This tax credit offers several notable benefits to qualifying companies:
- Financial Relief: Reduces the overall tax burden, freeing up resources for further business investment.
- Encourages Local Employment: Supports job creation and retention within Quebec’s design sector.
- Fosters Innovation: Promotes continuous creativity and innovation by supporting companies that invest in design-related activities.
Conclusion
The Tax Credit for the Realization of an Activity of Design Internally is a valuable tool for Quebec-based businesses engaged in design activities. By understanding and leveraging this tax credit, companies can significantly reduce their tax obligations and invest more in their creative capabilities. Ensuring compliance with eligibility requirements and maintaining accurate documentation will allow businesses to capitalize on this opportunity, driving growth and innovation in Quebec’s vibrant economy.
