Ontario Production Services Tax Credit
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The Ontario Production Services Tax Credit (OPSTC) is a refundable tax credit based upon eligible Ontario labour and other production expenditures incurred by a qualifying corporation with respect to an eligible film or television production.
The OPSTC requirements are generally “harmonized” with the federal Film or Video Production Services Tax Credit administered by the Canadian Audio Visual Certification Office of the Department of Canadian Heritage (CAVCO) and Canada Revenue Agency (CRA). For information on the federal credit contact CAVCO at 1-888-433-2200 or www.pch.gc.ca/Cavco.
How Much Is The Tax Credit?
The OPSTC has been expanded for expenditures incurred after June 30, 2009, and is calculated as 25% of all qualifying production expenditures incurred in Ontario. For expenditures incurred before this date, the OPSTC is calculated as 25% of the eligible Ontario labour expenditures incurred in Ontario. There is no limit on the amount of qualifying production expenditures. In addition, this credit can be combined with the federal Film or Video Production Services Tax Credit of 16% of qualified Canadian labour expenditures. There are no per project or annual corporate tax credit limits.
Who Is Eligible?
A qualifying corporation is a Canadian or foreign-owned corporation which carries on a film or video production or production services business at a permanent establishment in Ontario, files an Ontario corporate tax return and owns the copyright in the eligible production or contracts directly with the copyright owner to provide production services to an eligible production.
What Types of Production Are Eligible?
An eligible production must exceed a minimum production cost and must not be in an excluded genre. In addition, a production that receives an Ontario Film and Television Tax Credit is not eligible for an OPSTC.
The production cost must be at least $1 million (Cdn.), except in the case of a series consisting of two or more episodes or a pilot for such a series. In the case of a series or pilot, the cost for each episode which has a running time of thirty minutes or less must be at least $100,000 (Cdn.) and the cost for episodes with a longer running time must be at least $200,000 (Cdn.).
The production must not be in an excluded genre: news, current events or public affairs programming; a program that includes weather or market reports; talk shows; productions in respect of a game, questionnaire or contest; a sports event or activity; a gala presentation or awards show; a production that solicits funds; reality television; pornography; advertising; or a production produced primarily for industrial, corporate or institutional purposes; nor must it be a production for which public financial support would be contrary to public policy.
What Expenditures Are Eligible?
Expenditures incurred after June 30, 2009 include all qualifying production expenditures incurred in Ontario. Qualifying production expenditures consist of eligible wages, eligible service contracts and eligible tangible property expenditures. Eligible tangible property expenditures include such items as equipment, studio rentals and computer software.
Eligible production expenditures are expenditures paid to companies and partnerships which have a permanent establishment in Ontario and to Ontario-based individuals (individuals resident in Ontario at the end of the calendar year prior to the commencement of principal photography and at the time the payments were made).
The expenditures must also be reasonable in the circumstances, directly attributable to the production, and incurred for the stages of production from the final script stage to the end of postproduction. Expenditures must be incurred in the taxation year, paid in the taxation year or within 60 days after the end of the taxation year, and paid for services provided in Ontario.
How Is The Credit Administered?
The OPSTC is jointly administered by the Ontario Media Development Corporation (OMDC) - an agency of the Ministry of Tourism and Culture. Application is made to the OMDC for a certificate of eligibility, which the production company files with the Canada Revenue Agency together with its tax return in order to claim the OPSTC. The amount of the credit, net of any Ontario taxes owing, will be paid to the qualifying corporation. If the qualifying corporation does not owe any taxes, the full amount will be paid out.
PLEASE NOTE: CANADA REVENUE AGENCY (CRA) WILL ADMINISTER BOTH FEDERAL AND ONTARIO CORPORATE TAXES FOR TAXATION YEARS ENDING AFTER DECEMBER 31, 2008. PLEASE BE ADVISED THAT AS OF JANUARY 1ST 2009, THE CRA HAS BECOME THE FIRST POINT OF CONTACT FOR ALL CORPORATE TAX ENQUIRIES. (1 800 959-5525)
Related Documents:
- OPSTC Information/Application Package
- OPSTC Legislation; OPSTC Regulations
Click here to experience the new OMDC ONLINE APPLICATION PORTAL
Download Ontario Declaration of Residency/Consent Form
Download Taxpayer Authorization Form
Download Labour Calculation Form
Labour Calculation with Non-Ontario Costs Spreadsheet in Telefilm format that is easy to use and provides the applicant with an estimated % of labour that can be claimed.
For further information contact:
Tax Credits & Financing Programs
Ontario Media Development Corporation
Fax: 416.314.6876
E-mail: taxcredits@omdc.on.ca
Note: This sheet is a general guide and may not be relied upon in order to determine eligibility or the amount of an anticipated credit. Please consult the OPSTC legislation and regulation for further details.
