Tax credit for internal design in Quebec - Fashion design

Who is eligible?

• Corporations with an establishment in Quebec operating a business

Who is not eligible

• Companies that are exempt from tax.
• Crown corporations or wholly-owned subsidiaries of Crown corporations.

Eligible expenses

• Salaries paid to eligible in-house designers.
• Salaries paid to eligible in-house pattern makers.

Eligible geographic areas

• Businesses with an establishment in Quebec.

• Step 1: Enter Tax Credit Information in Income Tax ReturnIndicate the name of the tax credit and provide its code (17) and amount on one of lines 440p to 440y of your company's income tax return.
• Step 2: Gather DocumentationAttach the completed “Tax Credit for Internal Design Activities” form (CO-1029.8.36.7).
• Include a copy of the eligibility certificate issued by the Ministère de l’Économie, de l’Innovation et de l’Énergie for the internal design activity.
• Include a copy of the qualification certificate for an eligible designer or pattern maker, issued by the same ministry.
• Prepare and keep, but do not submit, the following support documents: an organizational chart showing related companies and persons, a record of weekly wages, and proof showing the tax credit is included in business or property income if applicable.
• Step 3: Submit the Required DocumentsAttach all prescribed documents to the company’s tax return. If any prescribed documents cannot be attached, send them separately no later than the later of: (a) twelve months after the tax return deadline, or (b) three months after the date the eligibility certificate is issued for that fiscal year.
• Indicate on each document the company name, identification and file numbers, and fiscal year-end date if submitted by mail.
• Send all documents in one package to expedite processing.
• Step 4: File Return Electronically or by MailIf filing electronically, submit documents through the authorized software’s features — paper copies are not required.
• If filing by mail, ensure all requirements above are followed for each document.
• Step 5: Await Review and ProcessingYour application will be processed when all required documents and attestation(s) are received.

• If documents are sent by mail, include the company name, identification and file numbers, and fiscal year-end date on each document.
• All required documents should ideally be sent together to speed up processing.
• The income tax return and related documents for this tax credit can be transmitted electronically if using authorized software, which eliminates the need for paper documents.
• Obtaining the eligibility certificate from the Minister of Economy, Innovation and Energy is mandatory for processing the claim, and the process will only proceed upon receipt of this certificate.