Manitoba Research and Development Tax Credit
This program targets scientific research and experimental development (as defined for federal purposes) carried on in Manitoba. Corporations may earn a tax credit which can be applied against Manitoba corporate income tax payable in the year earned, with unused credits available for a 20-year carry-forward (previously 10 years) and a three-year carry-back.
Offered by Ministry of Finance
Amount
15% of eligible expenditures made after April 11, 2017 (20% for eligible expenditures made before April 12, 2017), applied against Manitoba corporate income tax payable, with a 20-year carry-forward and a three-year carry-back
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Who can apply
- Scientific research and experimental development (as defined for federal purposes) carried on in Manitoba
About the funding
Corporations may earn a tax credit which can be applied against Manitoba corporate income tax payable in the year earned, with unused credits available for a 20-year carry-forward (previously 10 years) and a three-year carry-back. This income tax credit is administered by the Canada Revenue Agency on behalf of Manitoba. The tax credit rate is 20% for eligible expenditures made before April 12, 2017 and 15% for eligible expenditures made after April 11, 2017.
The credit is refundable for eligible expenditures incurred after 2009 by a corporation with a permanent establishment in Manitoba and where the research and experimental development is carried on in Manitoba under an eligible contract with a qualifying research institute.
Manitoba Budget 2010 extended refundability of this tax credit to in-house R & D expenditures (i.e., R & D not undertaken under contract with an institute in Manitoba) as follows:
- starting 2011, one quarter of the credit for in-house R & D is refundable; and
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- starting 2012, one half if the credit for in-house R & D is refundable.
The 2013 federal budget removed capital expenditures from the federal investment tax credit base, but Manitoba Budget 2013 protected the Manitoba credit from this federal tax cutting measure. The federal budget also reduced to 80% the claimable portion of contract payments; Manitoba retained full eligibility for contract payments to eligible institutes only. Manitoba reflected the further federal change reducing the prescribed proxy amount to recognize overhead costs attributable to eligible projects, from 65% to 60% of direct labour costs in 2013, and to 55% starting in 2014.
amendments to the definition “eligible expenditure” to ensure that:
ď‚· expenditures on first term and second term shared-use equipment will be
eligible;
ď‚· in order for a capital expenditure to be eligible
- it must be for depreciable property other than land or a leasehold interest
in land,
- the property must be acquired and considered to be available for use
within the meaning of s. 13(27) of the federal Act before the expenditure is eligible, and
- all or substantially all of the expenditure must be in relation to research
and development carried on in Manitoba.
Claimed through the Canada Revenue Agency on your corporate tax return.
Similar programs
| Program | Type | Amount | Status |
|---|---|---|---|
| Investment Tax Credits (ITC) on Qualified Expenditures for Scientific Research and Experimental Development (SR&ED) | Tax Credit | Non-refundable ITC of 15% of the SR&ED qualified expenditure pool | Open |
| Scientific Research and Experimental Development Tax Incentive Program (SR&ED) | Tax Credit | Investment tax credit at a basic rate of 15% | Open |
