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O. Reg. 684/00: ONTARIO FILM AND TELEVISION TAX CREDIT

filed December 21, 2000 under Corporations Tax Act, R.S.O. 1990, c. C.40

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ontario regulation 684/00

made under the

corporations tax act

Made: December 20, 2000
Filed: December 21, 2000

Amending O. Reg. 322/97

(Ontario Film and Television Tax Credit)

1. (1) Section 7 of Ontario Regulation 322/97 is amended by adding the following subsection:

(0.1) Subsections (1) and (1.1) set out the rules for determining the amount of a qualifying labour expenditure for a taxation year of a qualifying production company in respect of an eligible Ontario production for the purposes of section 43.5 of the Act.

(2) Subsection 7 (1) of the Regulation is amended by striking out the portion before paragraph 1 and substituting the following:

(1) The qualifying labour expenditure for a taxation year of a qualifying production company in respect of an eligible Ontario production that commenced principal photography before May 3, 2000 is the amount that is equal to the lesser of the amounts that would be determined in respect of the production under paragraphs (a) and (b) of the definition of “qualified labour expenditure” in subsection 125.4 (1) of the Federal Act, if section 125.4 of the Federal Act applied to the production and if paragraphs (a) and (b) of that definition were read as follows:

. . . . .

(3) Section 7 of the Regulation is amended by adding the following subsections:

(1.1) The qualifying labour expenditure for a taxation year of a qualifying production company in respect of an eligible Ontario production that commences principal photography after May 2, 2000 is the amount, if any, by which “A” exceeds “B” where,

  “A” is the amount that would be determined in respect of the production under paragraph (a) of the definition of “qualified labour expenditure” in subsection 125.4 (1) of the Federal Act,

(a) if no prescribed person, as defined in subsection 1106 (7) of the Federal Regulations, held an equitable interest in the production, and

(b) if paragraph (a) of that definition were read in accordance with the rules set out in paragraphs 1, 2, 3 and 4 of subsection (1), and

  “B” is the amount determined under subsection (1.2).

(1.2) The amount defined as “B” in subsection (1.1) is the amount calculated using the formula,

[C x ( D / E) ] + (F - G)

in which,

  “C” is the amount of any equitable investment in the production that is held by a Canadian government film agency,

  “D” is the Ontario labour expenditure in respect of the production,

“E” is the cost of the production,

“F” is the amount of any assistance in respect of the cost of the production otherwise determined under the definition of “assistance” in subsection 125.4 (1) of the Federal Act that, at the time the qualifying production company’s return is required to be delivered under subsection 75 (1) for the taxation year, the qualifying production company or any other person or partnership has received, is entitled to receive or can reasonably be expected to receive that is either,

(a) if the assistance is directly attributable to the Ontario labour expenditure included in the amount “A” referred to in subsection (1.1), the amount of that assistance, or

(b) if the assistance is in respect of the production and is not directly attributable to the expenditure described in clause (a), the amount of the assistance multiplied by a fraction in which the numerator is the expenditure described in clause (a) and the denominator is the cost of the production, and

  “G” is any amount of any assistance described in the definition of “F” that is deemed to be received by the qualifying production company or any other person or partnership under subsection 44.1 (5) of the Act if that subsection is read without reference to section 43.4 of the Act.

2. Section 1106 of Schedule 1 to the Regulation is amended by adding the following subsection:

Prescribed Amount

(8) For the purpose of the definition of “assistance” in subsection 125.4 (1) of the Act,

“prescribed amount” means an amount paid or payable to a taxpayer under the Licence Fee Program of the Canada Television and Cable Production Fund or the Canada Television Fund.

3. (1) Section 1 shall be deemed to have come into force on May 2, 2000.

(2) Section 2 shall be deemed to have come into force on February 23, 1998.