Ontario Dividend Tax Credit
no fixed amount
Tax Credit
Description:
The Ontario Dividend Tax Credit is intended to compensate individual shareholders for income tax paid by Canadian companies in which they have invested. Individual investors pay personal income tax on dividends, which are paid from corporate earnings that have already been taxed. The purpose of this tax credit is to avoid this double taxation.
Comments on Funding:
The tax credit offers two rates:
1. 10% for eligible dividends (received from Canadian public corporations and other corporations resident in Canada that are subject to the general corporate tax rate);
2. 2.9863% for other Canadian dividends (received from Canadian-controlled private corporations subject to the small business tax rate)
Rolling deadline
Eligibility:
Applicants must:
1. be individual investors who pay personal income tax on dividends;
2. have received dividents from:
a) Canadian public corporations and other corporations resident in Canada that are subject to the general corporate tax rate;
b) Canadian-controlled private corporations subject to the small business tax.
Application Steps:
Applicants must claim the credit on their personal income tax and benefit return. To do this, they will first need to calculate their credit on line 61520 of the provincial worksheet to determine the amount to enter on form ON428.
Documentation Needed:
Applicants must submit form ON428.
Other Things to Note:
Tax credit for individual investors / shareholders, not for businesses. I added it here considering it would be of interest for entrepreneurs (shareholders) – the people behind the business.
Updated: June 02, 2023
About the author
Maurice
