Effective January 1, 2016, the province of Newfoundland and Labrador increased its corporate income tax rate from 14% to 15%. The provincial tax rate is applied to the same taxable income as is calculated for the purposes of the federal corporate income tax system. This rate applies to taxable income earned in Newfoundland and Labrador that does not qualify for the federal small business deduction.
The following table details the corporate income tax rates for the 2018 taxation year.
|2018 Taxation Year|
|General Corporate Income Tax Rate||15%|
|Small Business Corporate Income Tax Rate||3%|
Businesses paying corporate income tax in Newfoundland and Labrador may offset their income tax payable with one of the province’s tax credits. The following tax credits are offered by the Province to investors and corporations:
- Direct Equity Tax Credit
- Economic Diversification and Growth Enterprises Program
- Film and Video Industry Tax Credit
- Interactive Digital Media Tax Credit
- Labour-Sponsored Venture Capital Tax Credit
- Political Contribution Tax Credit
- Scientific Research and Experimental Development Tax Credit
- Resort Property Investment Tax Credit
- Small Business Tax Rate
- Venture Capital Tax Credit
All of these credits have different rules concerning eligibility and whether you may carry the credits forward or backward.
You can use the Newfoundland and Labrador Corporation Tax Calculation – Schedule 307 to help you calculate the Newfoundland and Labrador tax before the credits are applied.
The Federal Government administers corporate income tax on behalf of the Province. The Canada Revenue Agency (CRA) can answer your corporate income tax questions. You can contact them at 1-800-959-5525. Additional information can also be obtained from the CRA website.