92 (1) A corporation that is a qualifying corporation for a taxation year and that complies with the requirements of this section may claim an amount for the year in respect of and not exceeding the corporation’s Ontario production services tax credit for the year.  2007, c. 11, Sched. A, s. 92 (1). Amount of tax credit (2) The amount of a qualifying corporation’s Ontario production services tax credit for a taxation year is the sum of the corporation’s eligible credits for the year in respect of eligible productions.  2007, c. 11, Sched. A, s. 92 (2). Eligible credit (3) A qualifying corporation’s eligible credit for a taxation year in respect of an eligible production is the sum of, (a) 18 per cent of the portion of its qualifying Ontario labour expenditure in respect of the production for the year that relates to expenditures incurred after December 31, 2004 and before January 1, 2008; (a.1)  Repealed:  2009, c. 18, Sched. 28, s. 11 (1). (b) 25 per cent of the portion of its qualifying Ontario labour expenditure in respect of the production for the year that relates to expenditures incurred after December 31, 2007 and before July 1, 2009; (c) 25 per cent of the portion of its qualifying production expenditure in respect of the production for the year that relates to expenditures incurred after June 30, 2009 and on or before April 23, 2015; and (d) 21.5 per cent of the portion of its qualifying production expenditure in respect of the production for the year that relates to expenditures incurred after April 23, 2015.  2007, c. 11, Sched. A, s. 92 (3); 2008, c. 7, Sched. S, s. 23 (1-3); 2009, c. 18, Sched. 28, s. 11 (1); 2009, c. 34, Sched. U, s. 17 (1); 2015, c. 20, Sched. 40, s. 13 (1, 2). Transitional (3.1) Despite subsection (3), a qualifying corporation’s eligible credit for a taxation year in respect of an eligible production includes 25 per cent of the portion of its qualifying production expenditures in respect of the production for the year that relates to expenditures incurred after April 23, 2015 and before August 1, 2016 if all of the following criteria are satisfied: 1. Before April 24, 2015, the corporation has entered into at least one written agreement in respect of a qualifying production expenditure in respect of the production with a person that deals at arm’s length with the corporation and any of the following criteria are satisfied: i. The agreement is in respect of services of a producer, a director, a key cast member, a production crew or a post-production crew. ii. The agreement is in respect of a studio located in Ontario, or a location in Ontario. iii. The agreement demonstrates, in the opinion of the Minister of Tourism, Culture and Sport, that the corporation has made a significant commitment to production activities in Ontario. 2. Before August 1, 2015, the corporation has applied to the Ontario Media Development Corporation under subsection (6) for a certificate in respect of the production. 3. Principal photography or key animation for the production commenced before August 1, 2015. 2015, c. 20, Sched. 40, s. 13 (3). Exception, prescribed tax credit rate (4) If a percentage is prescribed for the purposes of clause (3) (b), (c) or (d), the prescribed percentage and not the percentage set out in that clause shall apply in determining an amount under that clause in respect of the period to which the prescribed percentage applies.  2009, c. 34, Sched. U, s. 17 (2); 2015, c. 20, Sched. 40, s. 13 (4). Exception (5) Despite subsections (3) and (4), a qualifying corporation’s eligible credit for a taxation year in respect of an eligible production is nil if the corporation claims a tax credit in respect of the production for any taxation year under section 43.5 of the Corporations Tax Act or section 91.  2007, c. 11, Sched. A, s. 92 (5). Qualifying production expenditure (5.1) Subject to subsection (5.1.1), for the purposes of this section, a corporation’s qualifying production expenditure for a taxation year in respect of an eligible production is the amount, if any, by which “A” exceeds “B” where, “A” is the sum of, (a) the corporation’s eligible wage expenditure for the year or a previous taxation year in respect of the production, (b) the corporation’s eligible service contract expenditure for the year or a previous taxation year in respect of the production, (c) the amount determined under subsection (5.5) for the year or a previous taxation year in respect of the production, and (d) the corporation’s eligible tangible property expenditure for the year or a previous taxation year in respect of the production, and “B” is the sum of, (a) all relevant assistance in respect of the production, (i) that may reasonably be considered to be directly attributable to any amount included in the determination of “A” for the year, (ii) that, when it was required to file its return under this Act for the year, the corporation or any other person or partnership had received, was entitled to receive or was reasonably expected to receive, to the extent the assistance had not been repaid pursuant to a legal obligation to do so, and (iii) that has not caused a reduction of any amount included in the determination of “A” for the year in respect of the production, (b) the sum of all amounts, each of which is the corporation’s qualifying production expenditure in respect of the production for a previous taxation year before the end of which the principal photography of the production began, and (c) if the corporation is a parent, the sum of all amounts each of which is determined in respect of the production under subsection (5.5) as a consequence of an agreement referred to in that subsection between the corporation and the subsidiary corporation.  2009, c. 34, Sched. U, s. 17 (3); 2015, c. 20, Sched. 40, s. 13 (5). Same, expenditure not to exceed limit (5.1.1) A corporation’s qualifying production expenditure for a taxation year that commences on or after April 24, 2015 in respect of an eligible production shall not exceed the corporation’s qualifying production expenditure limit for the taxation year in respect of the eligible production, as determined under subsection (5.1.2). 2015, c. 20, Sched. 40, s. 13 (6). Qualifying production expenditure limit (5.1.2) For the purposes of subsection (5.1.1), a corporation’s qualifying production expenditure limit for a taxation year in respect of an eligible production is the amount, if any, by which “C” exceeds “D” where, “C” is four times the sum of, (a) the amount of the corporation’s eligible wage expenditure for the year or a previous taxation year in respect of the production to the extent that the eligible wage expenditure has not been included in the determination of the corporation’s qualifying production expenditure in respect of the production for a previous taxation year, (b) the amount of the corporation’s eligible service contract expenditure for the year or a previous taxation year in respect of the production that relates to remuneration paid by the corporation in respect of services provided under the contract to the extent that the amount has not been included in the determination of the corporation’s qualifying production expenditure in respect of the production for a previous taxation year, and (c) the amount determined under subsection (5.5) for the year or a previous year in respect of the production to the extent that the amount has not been included in the determination of the corporation’s qualifying production expenditure in respect of the production for a previous taxation year, and “D” is the sum of, (a) all relevant assistance in respect of the production, (i) that may reasonably be considered to be directly attributable to any amount included in the determination of “A” under subsection (5.1) for the year, (ii) that, when it was required to file its return under this Act for the year, the corporation or any other person or partnership had received, was entitled to receive or was reasonably expected to receive, to the extent the assistance had not been repaid pursuant to a legal obligation to do so, and (iii) that has not caused a reduction of any amount included in the determination of “A” under subsection (5.1) for the year in respect of the production, and (b) if the corporation is a parent, the sum of all amounts each of which is determined in respect of the production under subsection (5.5) as a consequence of an agreement referred to in that subsection between the corporation and the subsidiary corporation. 2015, c. 20, Sched. 40, s. 13 (6); 2020, c. 5, Sched. 7, s. 2 (1). Remuneration paid by corporation (5.1.3) For the purposes of clause (b) of the definition of “C” in subsection (5.1.2), remuneration paid by a corporation means that portion of the corporation’s eligible service contract expenditure for the year or a previous taxation year in respect of the production that is paid to, (a) an Ontario-based individual at the time the amount is paid and who is not an employee of the corporation, to the extent that the amount paid, (i) is attributable to services personally rendered by the individual in Ontario in respect of the production, or (ii) is attributable to and does not exceed the salary or wages paid by the individual to the individual’s employees at a time when they were Ontario-based individuals for personally rendering services in Ontario in respect of the production; (b) another corporation that is a taxable Canadian corporation, to the extent that the amount paid is attributable to and does not exceed the salary or wages paid to the other corporation’s employees at a time when they were Ontario-based individuals for personally rendering services in Ontario in respect of the production; (c) another corporation that is a taxable Canadian corporation, all the issued and outstanding shares of the capital stock of which (except directors’ qualifying shares) belong to an Ontario-based individual and the activities of which consist principally of the provision of the individual’s services, to the extent that the amount paid is attributable to services rendered personally in Ontario by the individual in respect of the production; or (d) a partnership, to the extent that the amount paid, (i) is attributable to services personally rendered in respect of the production by an Ontario-based individual who is a member of the partnership, or (ii) is attributable to and does not exceed the salary or wages paid by the partnership to its employees at a time when they were Ontario-based individuals for personally rendering services in Ontario in respect of the production. 2020, c. 5, Sched. 7, s. 2 (2). Eligible wage expenditure (5.2) For the purposes of this section and subject to subsection (5.8), a qualifying corporation’s eligible wage expenditure for a taxation year in respect of an eligible production is an amount equal to the salary and wages that are, (a) reasonable in the circumstances; (b) directly attributable to the production; (c) incurred by the corporation in the year or the previous taxation year; (d) related to services rendered in Ontario for the stages of production of the production after the final script stage to the end of the post-production stage; and (e) paid by it in the year or within 60 days after the end of the year to the corporation’s employees who were Ontario-based individuals at the time the payments were made (other than amounts incurred in the previous year that were paid within 60 days after the end of the previous year).  2009, c. 34, Sched. U, s. 17 (3); 2015, c. 20, Sched. 40, s. 13 (7). Eligible service contract expenditure (5.3) For the purposes of this section and subject to subsections (5.8) and (15), a qualifying corporation’s eligible service contract expenditure for a taxation year in respect of an eligible production is the total of all amounts each of which is the cost of a contract for services that is, (a) reasonable in the circumstances; (b) directly attributable to the production; (c) incurred by the corporation in the year or the previous taxation year; (d) related to services rendered in Ontario in the year or the previous year to the corporation for the stages of production of the production, after the final script stage to the end of the post-production stage; (e) paid by it in the year or within 60 days after the end of the year (other than amounts incurred in the previous taxation year that were paid within 60 days after the end of the previous year); and (f) paid to a person or partnership that carries on a business in Ontario through a permanent establishment and that is, (i) an Ontario-based individual at the time the amount is paid and who is not an employee of the corporation, provided the services are personally rendered in Ontario in respect of the production by the individual or the individual’s employees at a time when they were Ontario-based individuals, (ii) another corporation that is a taxable Canadian corporation, provided the services are personally rendered in Ontario in respect of the production by the other corporation’s employees at a time when they were Ontario-based individuals, (iii) another corporation that is a taxable Canadian corporation, all the issued and outstanding shares of the capital stock of which (except directors’ qualifying shares) belong to an Ontario-based individual and the activities of which consist principally of the provision of the individual’s services, or (iv) a
partnership, each member of which is an Ontario-based individual or a taxable Canadian corporation, provided the services are personally rendered in Ontario in respect of the production by an Ontario-based individual who is a member of the partnership or by the partnership’s employees at a time when they were Ontario-based individuals.  2009, c. 34, Sched. U, s. 17 (3); 2015, c. 20, Sched. 40, s. 13 (8, 9). Same, security services provided by off-duty police officers (5.4) Subject to clauses (5.3) (a) to (e) and subsection (5.8), an amount paid in a taxation year or a previous taxation year in respect of an eligible production to a trade union representing members of the Ontario Provincial Police Force or a municipal police force in Ontario for the provision of security services on the set of the production may be included in a corporation’s eligible service contract expenditure for the taxation year in respect of the production.  2009, c. 34, Sched. U, s. 17 (3). Note: On a day to be named by proclamation of the Lieutenant Governor, subsection 92 (5.4) of the Act is amended by striking out “members of the Ontario Provincial Police Force or a municipal police force in Ontario” and substituting “members of a police service as defined in the Community Safety and Policing Act, 2019”. (See: 2019, c. 1, Sched. 4, s. 58 (1)) Parent-subsidiary amounts (5.5) If the corporation has a parent that is a taxable Canadian corporation and if the corporation and the parent have agreed that paragraph (c) of the definition of “Canadian labour expenditure” in subsection 125.5 (1) of the Federal Act applies in respect of the production, the amount determined under this subsection is equal to the reimbursement made by the corporation in the year, or within 60 days after the end of the year (other than amounts incurred by the parent in the previous year that were reimbursed by the corporation within 60 days after the end of the previous year), of an amount that was incurred by the parent in a particular taxation year of the parent in respect of the production, if the amount would be included in the corporation’s eligible wage expenditure or eligible service contract expenditure in respect of the production for the particular taxation year if the corporation had had that particular taxation year and the expenditure had been incurred by the corporation for the same purpose as it was incurred by the parent and paid at the same time and to the same person or partnership as it was paid by the parent.  2009, c. 34, Sched. U, s. 17 (3). Eligible tangible property expenditure (5.6) For the purposes of this section and subject to subsections (5.7), (5.8), (16) and (17), a qualifying corporation’s eligible tangible property expenditure for a taxation year in respect of an eligible production is the sum of the amounts described in the following paragraphs: 1. If tangible property is acquired by the corporation, the total of all amounts each of which is an amount calculated in respect of a particular tangible property using the formula, (A × B × C)/365 in which, “A” is the undepreciated capital cost of the property at the beginning of the year or, where the property was acquired in the year, the cost of the property, “B” is the rate applicable to the property under Schedule II of the Federal regulations, and “C” is the number of days in the taxation year that the tangible property was available for immediate use
in respect of the eligible production in Ontario. 2. If tangible property is leased by the corporation, the total of all amounts each of which is the proportion of the lease cost attributable to the use in Ontario of the property in the taxation year in the course of completing the eligible production subject to subsection (5.7.1).  2009, c. 34, Sched. U, s. 17 (3); 2015, c. 20, Sched. 40, s. 13 (10); 2022, c. 23, Sched. 10, s. 1 (1). Same (5.7) An expenditure is not included in the eligible tangible property expenditure of a qualifying corporation for a taxation year with respect to an eligible production unless the following conditions are satisfied: 1. The property is used in Ontario in a manner that is directly attributable to the eligible production. 2. The property is used during the stages of production of the production, after the final script stage to the end of the post-production stage. 3. The expenditure is incurred by the corporation in the year or the previous taxation year. 4. The expenditure is paid by the corporation in the year or within 60 days after the end of the year (other than amounts incurred in the previous taxation year that were paid within 60 days after the end of the previous year). 5. The expenditure is reasonable in the circumstances. 6. In the case of an expenditure incurred on or before November 14, 2022 in respect of any kind of tangible property or an expenditure incurred after November 14, 2022 in respect of tangible property other than the type of leased real property described in paragraph 6.1, the expenditure is paid to a person or partnership, i. that is ordinarily engaged in the business of selling or leasing tangible property of the type of tangible property acquired or leased by the qualifying corporation, ii. that carries on business through a permanent establishment in Ontario, iii. that is a taxable Canadian corporation or an Ontario-based individual at the time the amount is paid or a partnership comprised entirely of members that are taxable Canadian corporations or Ontario-based individuals at the time the amount is paid, iv. in the case of an individual, who is not an employee of the qualifying corporation, and v. in the case of a partnership, whose members are not employees of the qualifying corporation. 6.1 In the case of an expenditure incurred after November 14, 2022 in respect of real property leased by the qualifying corporation from a person or partnership not ordinarily engaged in the business of leasing the type of real property in question, the expenditure is paid to a person or partnership, i. that deals at arm’s length with the qualifying corporation, ii. in the case of an individual, who is not an employee of the qualifying corporation, and iii. in the case of a partnership, whose members are not employees of the qualifying corporation. 2009, c. 34, Sched. U, s. 17 (3); 2010, c. 1, Sched. 29, s. 8 (1); 2015, c. 20, Sched. 40, s. 13 (11); 2022, c. 23, Sched. 10, s. 1 (2, 3). Limit on certain expenditures (5.7.1) The total amount of expenditures described in paragraph 6.1 of subsection (5.7) that may be included in a qualifying corporation’s qualifying production expenditure under subsection (5.1) for a taxation year in respect of an eligible production is the lesser of, (a) the total amount determined in respect of those expenditures under paragraph 2 of subsection (5.6); and (b) the amount that is 5 per cent of the amount of the qualifying production expenditure that would be determined under subsection (5.1) if that amount were determined without reference to this subsection. 2022, c. 23, Sched. 10, s. 1 (4). Same (5.8) A corporation’s qualifying production expenditure in respect of an eligible production does not include expenditures incurred for or on account of, (a) meals and entertainment (other than reasonable expenditures for food and non-alcoholic beverages provided to individuals working on an eligible production at a studio or location set on a day filming is taking place); (b) alcoholic beverages; (c) hotel and living expenses; (d) remuneration determined by reference to profits or revenues; (e) an amount to which section 37 of the Federal Act applies; or (f) for greater certainty, an amount that is not a production cost (including an amount in respect of advertising, marketing, promotion, market research) or an amount related in any way to another film or video production.  2009, c. 34, Sched. U, s. 17 (3). Application for certificate (6) In order to be eligible to claim an amount in respect of an Ontario production services tax credit under this section with respect to a particular production, a qualifying corporation shall apply to the Ontario Media Development Corporation, or to another person designated by the Minister of Culture, for certification that the production is an eligible production for the purposes of this section.  2007, c. 11, Sched. A, s. 92 (6). Same (7) A qualifying corporation that applies for certification shall provide the information specified for the purposes of this section by the Ontario Media Development Corporation or the person designated by the Minister of Culture to the person who specified that it be provided.  2007, c. 11, Sched. A, s. 92 (7). Certificate (8) The Ontario Media Development Corporation or the person designated by the Minister of Culture shall issue to the qualifying corporation a certificate and any amended certificates, (a) if the particular production is an eligible production for the purposes of this section; and (b) if the qualifying corporation, (i) has not claimed a tax credit in respect of the production under section 43.5 of the
Corporations Tax Act or section 91, or (ii) has claimed a tax credit in respect of the production under section 43.5 of the Corporations Tax Act or section 91 which was not allowed on assessment by the Minister of Finance or the Ontario Minister, as the case may be, and the corporation has not objected to the assessment on the issue of the disallowance.  2007, c. 11, Sched. A, s. 92 (8). Same (9) Each certificate issued under subsection (8) must certify that the particular production is an eligible production for the purposes of this section and certify the estimated amount of the corporation’s eligible credit for the production for the purposes of this section.  2007, c. 11, Sched. A, s. 92 (9). Certificate to be delivered with return (10) In order to claim an amount under this section for a taxation year in respect of a particular production, a qualifying corporation must deliver to the Ontario Minister with its return for the year the certificate most recently issued in respect of the production or a certified copy of the certificate.  2007, c. 11, Sched. A, s. 92 (10). Revocation of certificate (11) A certificate or amended certificate issued under subsection (8) may be revoked, (a) if an omission or incorrect statement was made for the purpose of obtaining the certificate; (b) if the production is not an eligible production; (c) if the corporation to which the certificate is issued is not a qualifying corporation; or (d) if a certificate in respect of the production is issued to the corporation under section 43.5 of the Corporations Tax Act or section 91.  2007, c. 11, Sched. A, s. 92 (11). Same (12) A certificate that is revoked is deemed never to have been issued.  2007, c. 11, Sched. A, s. 92 (12). Definitions (13) In this section, “eligible production” means a film or television production that satisfies the prescribed conditions; (“production admissible”) “Ontario-based individual” means, in relation to an eligible production, an individual who was resident in Ontario at the end of the calendar year immediately before the calendar year in which principal photography for the production commences; (“particulier domicilié en Ontario”) “parent” means a corporation that owns all the issued and outstanding shares of the capital stock (except directors’ qualifying shares) of another corporation; (“société mère”) “qualifying corporation” means a corporation that satisfies the prescribed conditions; (“société admissible”) “qualifying Ontario labour expenditure” means the amount determined under the prescribed rules. (“dépense de main-d’oeuvre admissible en Ontario”) “relevant assistance” means an amount that satisfies the prescribed conditions; (“aide pertinente”) “tangible property” means property that can be seen, weighed, measured, felt or touched or that is in any way perceptible to the senses, and is deemed to include software. (“bien corporel”)  2007, c. 11, Sched. A, s. 92 (13); 2009, c. 34, Sched. U, s. 17 (4); 2010, c. 1, Sched. 29, s. 8 (2). Inflation of tax credit claim (14) Despite any other provision in this section, if a qualifying corporation has incurred expenditures that are included in its qualifying production expenditure for the year in respect of an eligible production pursuant to a contract with a person or partnership with which the corporation does not deal at arm’s length, and the Ontario Minister reasonably believes that one of the principal purposes of the existence of the contract was to increase the amount of the corporation’s tax credit under this section, the amount of the tax credit will be reduced by the amount of the increase.  2009, c. 34, Sched. U, s. 17 (5). Same, eligible service contract (15) For taxation years commencing after April 23, 2015, if a qualifying corporation enters into a contract for service with a person or partnership with which the corporation does not deal at arm’s length, an amount incurred by the corporation pursuant to the contract shall not be included in the corporation’s eligible service contract expenditures for a taxation year in respect of an eligible production for the purposes of subsection (5.3) unless the amount would have been an eligible wage expenditure or eligible service contract expenditure of the person or partnership if, (a) the person or partnership was a qualifying corporation; and (b) the expenditure was incurred by the person or partnership in respect of an eligible production. 2015, c. 20, Sched. 40, s. 13 (12). Same, acquisition of tangible property (16) For taxation years commencing after April 23, 2015, if a qualifying corporation acquires tangible property from a person or partnership with which the corporation does not deal at arm’s length, for the purposes of determining the corporation’s eligible tangible property expenditure for a taxation year in respect of an eligible production under subsection (5.6), the definition of “A” in paragraph 1 of that subsection shall be read as follows, “A” is, (a) in respect of the year in which the tangible property was acquired, the lesser of, (i) the corporation’s purchase price of the tangible property, (ii) the costs of the tangible property to the person or partnership, and (iii) the undepreciated capital costs of the tangible property at the beginning of the person’s or partnership’s taxation year in which the corporation acquired the tangible property, and (b) in respect of a year other than the year in which the tangible property was acquired, the amount that would be the undepreciated capital costs of the property at the beginning of the year if the costs of the property had been the amount determined under clause (a). 2015, c. 20, Sched. 40, s. 13 (12). Same, lease of tangible property (17) For taxation years commencing after April 23, 2015, if a qualifying corporation leases tangible property from a person or partnership with which the corporation does not deal at arm’s length, then the following rules apply in respect of the lease for the purposes of determining the corporation’s eligible tangible property expenditure for a taxation year in respect of an eligible production under subsection (5.6): 1. If the person or partnership that leases the tangible property to the corporation owns the tangible property, then the amount of the corporation’s eligible tangible property expenditure for the year in respect of that property is the lesser of the amount that would otherwise be determined under paragraph 2 of subsection (5.6) and the amount that would be determined under paragraph 1 of subsection (5.6) if the corporation owned the tangible property. 2. If the person or partnership that leases the tangible property to the corporation has itself leased the tangible property, then the amount of the corporation’s eligible tangible property expenditure for the year in respect of that property is the amount that would be determined under paragraph 2 of subsection (5.6) if the lease cost for the purposes of that paragraph was the lesser of the lease costs of the corporation and the lease costs of the person or partnership. 2015, c. 20, Sched. 40, s. 13 (12). Exception, parties to certain litigation (18) A qualifying corporation that was a party to the action in the matter of Rookie Blue Two Inc. v. Her Majesty the Queen, court file number CV-14-499450, decided by the Ontario Superior Court of Justice on March 11, 2015, shall, for the purposes of determining its eligible expenditures with respect to the eligible production referred to in that matter, determine the following expenditures as they would have been determined under this section as it read immediately before the Building Ontario Up Act (Budget Measures), 2015 received Royal Assent: 1. The eligible wage expenditure under subsection (5.2). 2. The eligible service contract expenditure under subsection (5.3). 3. The eligible tangible property expenditure under subsection (5.7). 2015, c. 20, Sched. 40, s. 13 (12). Section Amendments with date in force (d/m/y) 2008, c. 7, Sched. S, s. 23 (1-4) - 01/01/2008 2009, c. 18, Sched. 28, s. 11 (1, 2) - 01/01/2009; 2009, c. 34, Sched. U, s. 17 (1-5) - 01/07/2009 2010, c. 1, Sched. 29, s. 8 (1, 2) - 01/07/2009 2015, c. 20, Sched. 40, s. 13 (1-6, 8, 10, 12) - 04/06/2015; 2015, c. 20, Sched. 40, s. 13 (7, 9, 11) - 01/07/2009 2018, c. 3, Sched. 5, s. 60 (1) - no effect - see 2019, c. 1, Sched. 3, s. 5 - 26/03/2019 2019, c. 1, Sched. 4, s. 58 (1) - not in force 2020, c. 5, Sched. 7, s. 2 (1, 2) - 04/06/2015 2022, c. 23, Sched. 10, s. 1 (1-4) - 14/11/2022