Just because we call an industry “small business,” it doesn’t mean those businesses don’t get busy.
They need help, in the form of employees.
Their ability to create jobs — sometimes on small budgets — helps economic growth across Canada.
That’s why the Conservative federal government has created several job creation tax credits.
National Revenue Minister Kerry-Lynne Findlayappeared beforehigh-tech industry business owners in Kitchener, Ont., last week to discuss the opportunities.
“Our government has made real progress in offering tax relief measures that support a more skilled and educated workforce. These initiatives are helping Canada build a strong foundation for future economic growth and job creation,” she said. “Through tax relief measures, grants and support for training programs, we are encouraging apprenticeships and careers in the skilled trades.”
Three key tax credits
Findlay highlighted the three tax credits and stressed how important the tax relief is to Canadian businesses.
Apprenticeship Job Creation Tax Credit
The AJCTC ensures jobs are available for Canadians entering the labour market and those looking to upgrade their skills and training. The tax credit allows businesses a maximum credit of $2,000 per year for the first two-year term of hire for each eligible apprentice. It also features additional incentives to hire new apprentices in eligible trades.
More than 13,250 employers have used the credit to deduct more than $108 million on their income tax returns, according to the Canada Revenue Agency.
Hiring Credit for Small Business
The HCSB was introduced in the Economic Action Plan 2011. It helps stimulate new employment, supporting small business and providing relief from each employer’s share of employment insurance premiums.
The hiring credit returns up to $1,000 on an employer’s payroll account.
As of August 2013, more than 549,000 employers have received more than $209 million in credits.
Investment Tax Credit
The federal government initiated the Scientific Research and Experimental Development Program to encourage Canadian business of all sizes and in all sectors to conduct research and development (R&D) in Canada.
The SRED allows Canadians to earn a refundable Investment Tax Credit of 35 per cent on up to $4 million in qualified R&D carried out in Canada. The tax credit is fully refundable on all R&D expenditures and 40 per cent refundable on qualified R&D capital expenditures.
As a small business owner, have you capitalized on any of these tax credits? We’d love to hear about your experience.
Here to help
A1 Accounting, a Calgary accounting and bookkeeping firm, is here to assist you with your taxes and planning. We specialize in personal taxes and small-business accounting and financial services. Contact one of our tax specialists and we can help you optimize the tax benefits and credits available to self-employed individuals and small businesses.
Fill out our contact form or give us a call at 403-226-8297.
The Canada Revenue Agency has an active Twitter account. If you’re interested in following the account, you can the CRA at@CanRevAgency.