14 Feb 2019

Does your business perform manufacturing and processing activities? Are you considering acquiring production equipment or computer systems for your processes, particularly as part of your 4.0 manufacturing strategy? You should do it in 2019.

The Quebec investment tax credit (QITC) for manufacturing and processing equipment has been enhanced and is now available for ALL Quebec regions with some very attractive benefits.

The temporary increase in the QITC announced by the Quebec government on August 15, 2018 (increase applicable to property acquired after August 15, 2018 and before January 1, 2020) is designed to support the expansion and productivity improvements of businesses investing in manufacturing and processing equipment.

QITC tax rate

The QITC tax rate is at least 10% (20% for the metal processing sector) and can be as much as 45% for some Quebec regions (provided the corporation is entitled to the increased rates, otherwise it would be 5%) (see the table below).

The applicable credit rate depends on the location and timing of the investment as well as other factors:

  • The size of the business (global paid-up capital);
  • Whether the corporation qualifies as a metal processing corporation (based on the overall payroll);
  • Eligible property (is new and used exclusively in Quebec):
    • Internally designed and manufactured equipment for the business’s own use may qualify;
  • Eligible related expenditures;
  • Optimizing eligible expenditures ($12,500 exclusion threshold per property).

While it may be advantageous, the QITC is a complex tax measure that is closely scrutinized by Revenu Québec.

Our canadian tax experts can support your processes in order to maximize the QITC during the preliminary analysis, optimization, documentation and filing of the application, assisting during the audit and much more…

Not only can they help you achieve savings by ensuring you have everything you need to claim the credit, they would be more than pleased to advise you on the additional capital cost allowance, accelerated capital cost allowance and any other matter to help reduce your tax burden. Contact us.

The following table presents the QITC for businesses with a paid-up capital under $250 million.

Tableau anglais CIIQ

  1. The remote zones consist of the following administrative regions: Abitibi-Témiscamingue, Côte-Nord, Nord-du-Québec and Gaspésie–Îles-de-la-Madeleine.
  2. The eastern portion of the Bas-Saint-administrative regions includes the following Regional County Municipalities (RCM): La Matapédia, La Mitis and La Matanie.
  3. The intermediate zones include the following administrative regions and RCMs: Saguenay–Lac-Saint-Jean administrative region, Mauricie administrative region, Antoine-Labelle RCM, Kamouraska RCM, La Vallée-de-la-Gatineau RCM, Les Basques RCM, Pontiac RCM, Rimouski-Neigette RCM, Rivière-du-Loup RCM and Témiscouata RCM.

This article was written in collaboration with Kim Joyal Lamarche.

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14 Feb 2019

What changes should taxpayers be aware of for their 2018 tax returns? Our tax specialist, Sarah Phaneuf, highlights some new developments.

The 2018 tax season is just around the corner. Sarah Phaneuf, Tax Partner at Raymond Chabot Grant Thornton, contributed to a Protégez-vous magazine article (February 2019 edition) and discussed a number of changes individuals should be aware of in their tax returns.

Phaneuf identified a variety of tax measures and added:

“Some tax credits have been enhanced or extended to support the middle class and have wealthier individuals pay more taxes. For example, given the worsening workforce shortage due to massive baby-boomer retirements, a number of smaller measures encourage individuals to work more or longer.”

“Additionally, since January 2018, income splitting measures at both the federal and provincial levels have been significantly curtailed. This will limit tax savings for contractors and incorporated professionals (physicians, accountants, lawyers, etc.) who could previously split some dividend income with their spouse or adult children.”

Read the full article (in French) in Protégez-vous.

Consult our online Tax Planning Guide for help in preparing your tax returns.

To call on the help of a professional, use taxo.ca, an online tax service for individuals that is available year-round. Enter your data quickly, at any time, and let our professionals do the calculations for you.

Remember that the 2018 tax filing deadline is April 30, 2019.

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13 Feb 2019

The inescapable workforce shortage issue requires organizations to reinvent themselves. Increasingly, they are introducing initiatives to attract and retain employees.

The Raymond Chabot Grant Thornton Saguenay–Lac-Saint-Jean Partners had a bold and original idea to offer a trip to New York City to some 100 employees on February 1-3, 2019.

Éric Dufour, Regional Vice-President stated: “We practise what we preach! We support organizations in deploying strategic human resource activities. We have to adapt as well and ensure that our employees have a high happiness and engagement index.”

The New York trip was the culmination of an ongoing improvement initiative involving employees during 2018.

Claudie Arcand-Bellemare, Tax Consultant said: “It was awesome. It’s a privilege to work for an employer of choice who gives us the opportunity to have exceptional experiences and strengthen the bonds with our colleagues. Everybody came back from the trip more motivated than ever.”

In addition to the reward, new measures were introduced recently to meet the needs of the new generations, such as flexible schedules, a new dress code and a new governance structure.

RCGT à New York

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11 Feb 2019

Louis Roy, President of Catallaxy, commented in the media on the lack of guidance surrounding cryptocurrency exchange platforms.

In this highly publicized case in early February 2019, Raymond Chabot Grant Thornton’s partner expressed in several media outlets that “this event highlights the extent to which governance, regulation and internal control are needed in this sector of activity. Currently, it is not monitored at all”.

In an interview with L’heure du monde, broadcast on Radio-Canada, Louis stated that presently, there is no firm law on virtual currency exchange platforms.

“If the regulations applicable to financial institutions had been in effect, investors wouldn’t be in this situation. Their assets would have been held by a custodian, that is, a third party charged with safekeeping the assets of the clients on the exchange platform.”

Since 2014, Canadian and European authorities, namely the G20, have been developing new international regulations on the proceeds of crime (money laundering) and terrorist financing. Louis Roy insists on the fact that it is crucial to standardize regulation in both the law and the definitions attributed to cryptocurrencies.

“Under the law, cryptocurrency is considered a currency. However, from a tax point of view, it is considered property, so there are still numerous inconsistencies between the laws and we need to ensure that the public is protected.”

A guest of Anne-Marie Dussault’s on the 24/60 show broadcast on RDI, Louis pointed out the importance of informing investors about the current lack of internal control and the risks of investing in cryptocurrency.

“At Catallaxy, this is exactly what we promote: implementing governance and auditing in the world of cryptocurrency.”

Louis highlighted all of the advantages of blockchain technology, the first use of which is currently for virtual currency.

On Phare Ouest, broadcast on Radio-Canada and hailing from the Vancouver region, Louis reiterated: “I think there has to be a wake-up call in this activity sector. If we want the industry to listen, there need to be regulations that protect investors and savers. There is some regulation, but it needs to be adjusted.”

You can also read Louis Roy’s comments on Conseiller.ca and in Le Devoir on February 6 and Le Devoir on February 9.

Consult Catallaxy to learn more about the services offered.