8.1 (1) The amount of an eligible employer’s graduate transitions tax credit for a taxation year is the sum of, (a) all amounts each of which is in respect of a qualifying employment that commenced not less than 12 months before the end of the taxation year or terminated before the end of the taxation year, equal to the lesser of the employer’s eligible amount for the taxation year in respect of the qualifying employment determined under subsection (2) and $4,000; and (b) the total of all amounts, each of which is an amount determined by multiplying the eligible percentage by the amount of a repayment, if any, made by the employer during the taxation year, of government assistance in respect of the qualifying employment of an employee, to the extent the repayment does not exceed the amount of the assistance in respect of the qualifying employment that, (i) has not been repaid in a prior taxation year, and (ii) can reasonably be considered to have reduced the amount of a graduate transitions tax credit that would otherwise have been allowed to the employer under this Act in respect of the qualifying employment.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Eligible amount (2) An eligible employer’s eligible amount for a taxation year in respect of a qualifying employment is the amount determined under the following rules: 1. If the qualifying employment commenced before January 1, 1998, the amount is 10 per cent of the total of all eligible expenditures made by the employer in respect of the qualifying employment. 2. If the qualifying employment commenced after December 31, 1997 and before July 5, 2004 and the total of all salaries or wages paid by the employer in the previous taxation year is equal to or greater than $600,000, the amount is 10 per cent of the total of all eligible expenditures made by the employer in respect of the qualifying employment. 3. If the qualifying employment commenced after December 31, 1997 and before July 5, 2004 and the total of all salaries or wages paid by the employer in the previous taxation year is not greater than $400,000, the amount is 15 per cent of the total of all eligible expenditures made by the employer in respect of the qualifying employment. 4. If the qualifying employment commenced after December 31, 1997 and before July 5, 2004 and the total of all salaries or wages paid by the employer in the previous taxation year is greater than $400,000 but less than $600,000, the amount is the amount determined in accordance with the following formula: A = (10% × B) + [(5% × B) × (1 – C/$200,000)] where, “A” is the amount of the employer’s eligible amount for the taxation year in respect of the qualifying employment, “B” is the amount of all eligible expenditures made by the employer in respect of the qualifying employment, and “C” is the amount by which the total of all salaries or wages paid by the employer in the previous taxation year exceeds $400,000. 1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3; 2004, c. 31, Sched. 19, s. 6 (1-3). Number of tax credits (3) Except for a tax credit in respect of the repayment of government assistance, a tax credit under this section may be claimed only once in respect of each qualifying employment.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Partnership (4) If an eligible employer is a member of a partnership and the partnership would qualify for a graduate transitions tax credit for a taxation year if the partnership were an eligible employer, the portion of the tax credit that may reasonably be considered to be the member’s share of the tax credit may be included in determining the amount of the member’s graduate transitions tax credit for that taxation year.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Limited partner (5) Despite subsection (4), a limited partner’s share of a partnership’s graduate transitions tax credit referred to in subsection (4) shall be deemed to be nil.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Eligible employer (6) For the purposes of this section and subsection 8 (15.1), an individual is an eligible employer for a taxation year if the individual, (a) carries on business during the taxation year, either alone or as a member of a partnership, through a permanent establishment in Ontario; and (b) is not exempt from tax under the Act for the taxation year by reason of section 6.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Qualifying employment (7) The employment of an employee by an eligible employer is a qualifying employment if, (a) the employment commenced after May 6, 1997 and before July 5, 2004 and continued for at least six consecutive months, and during those six months the employee was required to work an average of more than 24 hours a week; and (b) the employee, (i) was not related to the eligible employer at the time the employment commenced, (ii) had not been employed by any person more than 15 hours per week during 16 of the 32 weeks immediately before the first day of the employment, (iii) had not had a source of income from a business for at least 16 of the 32 weeks immediately preceding the first day of the employment, (iv) completed all requirements to qualify for graduation from a prescribed program of study within three years before the first day of the employment, and (v) carried out his or her employment duties at or through a permanent establishment of the eligible employer in Ontario.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3; 2004, c. 31, Sched. 19, s. 6 (4). Eligible expenditures (8) An eligible employer’s eligible expenditures in respect of a qualifying employment are the amounts paid or payable to the employee as salary or wages during the 12-month period commencing on the first day of the qualifying employment that, (a) would be considered for the purposes of Part XXVI of the Federal Regulations to be included in the amount of salary or wages paid to employees of a permanent establishment of the employer in Ontario; and (b) are required by Subdivision a of Division B of Part I of the Federal Act to be included in the income from employment of the employee in respect of the qualifying employment.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Same (9) The total of all eligible expenditures made by an eligible employer in respect of a qualifying employment shall be the amount otherwise determined less the amount of all government assistance, if any, in respect of the eligible expenditures that, at the time the eligible employer is required to deliver a return under this Act for the taxation year for which the tax credit is claimed, the eligible employer has received, is entitled to receive or can reasonably be expected to be entitled to receive.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Exception (10) Despite subsections (8) and (9), an expenditure made by an eligible employer in respect of a qualifying employment is not an eligible expenditure in respect of the employment, (a) to the extent that the amount of the expenditure would not be considered to be reasonable in the circumstances by persons dealing with each other at arm’s length; or (b) if the qualifying employment is with a person other than the eligible employer.  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Definitions (11) In this section, “eligible percentage” means, in respect of a repayment of government assistance, the percentage used in determining the amount of the tax credit, if the receipt of the government assistance reduced the amount of a tax credit available under this section; (“pourcentage autorisé”) “government assistance” means assistance from a government, municipality or other public authority in any form, including a grant, subsidy, forgivable loan, deduction from tax and investment allowance, but not including a graduate transitions tax credit under subsection 8 (15.1), a workplace accessibility tax credit under subsection 8 (15.3) or an investment tax credit under section 127 of the Federal Act; (“aide gouvernementale”) “individual” means a person who is an individual for the purposes of subsection 8 (15.1); (“particulier”) “prescribed program of study” means a program of study that satisfies the rules prescribed by the regulations; (“programme d’études prescrit”) “salary or wages” has the meaning assigned to that term by subsection 248 (1) of the Federal Act. (“traitement ou salaire”)  1997, c. 43, Sched. B, s. 5; 1998, c. 34, s. 70; 2004, c. 16, s. 3. Regulations (12) The Lieutenant Governor in Council may make regulations prescribing the method of calculating the amount of salaries or wages that will be deemed to be paid by an eligible employer in a previous taxation year for the purposes of subsection (2).  1997, c. 43, Sched. B, s. 5; 2004, c. 16, s. 3. Section Amendments with date in force (d/m/y) 1997, c. 43, Sched. B, s. 5 - 1/01/1997; 1998, c. 34, s. 70 - 1/01/1998 2004, c. 16, s. 3
- 1/01/2004; 2004, c. 31, Sched. 19, s. 6 (1-4) - 5/07/2004