New tax holiday for major investment projects
$18,000
Tax Credit
Description:
A corporation or partnership that carries out a major investment project in Quebec after March 21, 2023 may, under certain conditions, benefit from a combination:
income tax holiday;
And
employer contribution holiday to the Health Services Fund.
The tax holiday that the company or partnership can benefit from can reach 15%, 20% or 25% of the total eligible investment expenses relating to the completion of its major investment project, the rate being determined according to the territory where the project is carried out.
The new tax holiday lasts for 10 years.
Comments on Funding:
A company that operates an international financial centre (IFC) can benefit from a tax credit with respect to the salary of its eligible employees.
Continuous Intake. No specific deadline was identified.
Eligibility:
Only a corporation or partnership may file an application for an initial certificate.
A group of companies and/or partnerships may not file a joint application for eligibility, whether through a joint venture or otherwise.
Application Steps:
To benefit from the new tax holiday, a company or partnership must obtain an initial certificate as well as annual certificates issued by the Minister of Finance.
Initial certificate
The application for an initial certificate must be submitted to the Minister of Finance no later than December 31, 2029.
After analyzing the application, an initial certificate is issued to the company or partnership by the Minister of Finance if he is of the opinion that the project submitted can likely be recognized as a major investment project and that the activities resulting from it will be carried out in Quebec.
To request an initial certificate, go to the Apply page .
Annual certificate
Where the corporation or partnership holds a valid initial certificate, it may submit to the Minister of Finance an application for an annual certificate for each taxation year or financial year included, in whole or in part, in its exemption period.
The annual certificate certifies that:
the company continues, in the tax year, the activities relating to the major investment project in respect of which an initial certificate was issued;
the project is recognized for the tax year as a major investment project.
The request for annual certification must be submitted before the expiry of the 15th month following the end of the tax year or financial year for which it is requested.
The Minister of Finance may issue an annual certificate in respect of an investment project, for a taxation year or a fiscal year, only if the total investment expenditures attributable to the carrying out of the investment project are at least $100 million. This total may be reached at any time during the year or fiscal year.
Report of an independent auditor
The company or partnership is required to attach, when requesting the issue of its first annual certificate relating to the project, the report of an independent auditor.
The report of an independent auditor must certify:
the total eligible investment expenditure attributable to the implementation of the investment project;
the allocation of expenses based on where the goods will be mainly used;
the total of all government or non-government assistance, attributable to a capital expenditure, that the corporation or partnership, at the time of the application, has received, is entitled to receive or can reasonably expect to receive;
any other information that will be prescribed by the Minister of Finance for the administration and application of the measure.
In the event that the company or partnership submits its first application for annual certification before the end of the 48-month period, it is required to file, at the end of its investment period:
a revised audit opinion confirming the information in the initial report or any changes made;
any other information that will be prescribed by the Minister of Finance for the administration and application of the measure.
Documentation Needed:
Initial Certificate:
1. Application for an initial certificate (submitted to the Minister of Finance no later than December 31, 2029)
Annual Certificate:
2. Application for an annual certificate (submitted before the expiry of the 15th month following the end of the tax or financial year)
3. Proof that:
– The company continues activities related to the major investment project
– The project is recognized as a major investment project for the tax year
4. Evidence that total investment expenditures attributable to the project are at least $100 million
Report of an Independent Auditor (Required for First Annual Certificate):
5. Independent auditor’s report certifying:
– Total eligible investment expenditures attributable to the project
– Allocation of expenses based on usage location
– Total government or non-government assistance received or expected
– Any other required information prescribed by the Minister of Finance
Revised Audit Opinion (If First Annual Certification is Submitted Before 48 Months):
6. Revised audit opinion confirming or updating initial audit report information
7. Any other information prescribed by the Minister of Finance
Other Things to Note:
For more information on the request for initial certification for an investment project and on requests for annual certification, please contact the following department:
Major Projects and Investment Capital Directorate
Ministry of Finance
390, boulevard Charest Est
Québec (Québec) G1K 3H4
Telephone: 418 691-2227
Email: congefiscal@finances.gouv.qc.ca
Telephone: 418 691-2227 Email: congefiscal@finances.gouv.qc.ca
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Maurice
