90  /

Notes, continued

(7) Eligible expenditures in Ontario are those that qualify for federal ITC purposes. The credit is 

non-refundable and is applicable for taxation years ending after 2008. Unused credits may 

be carried forward 20 years and carried back three years (but only back to taxation years 

ending after 2008).

(8) In Quebec, eligible entities include universities, public research centres, and private 

research consortiums. These entities must carry on business in Canada and perform R&D 

in Quebec, or have such work carried out on their behalf in Quebec. An advance ruling 

from the Quebec Ministry of Revenue is required in order to qualify. Claimants no longer 

need to have a permanent establishment in Quebec.

Other types of eligible payments include expenditures in respect of pre-competitive 

research projects. An advance ruling from the Quebec Ministry of Revenue is required in 

order to qualify. Claimants no longer need to have a permanent establishment in Quebec.

(9) In Quebec, to be eligible for the 37.5% rate in respect of a maximum of $3 million in 

qualifying expenditures, the Canadian-controlled corporation must have less than $50 

million in assets on an associated worldwide basis in the preceding year. For corporations 

with assets between $50 million and $75 million, this rate is proportionally reduced to 

17.5%. The limit must be shared by associated corporations. 

For eligible biopharmaceutical corporations, also see note 10 on the following page.

The credit reduces eligible expenditures for federal purposes. Following the 2013 Quebec 

budget (delivered on November 20, 2012), the credit is now taxable in Quebec.

Provincial Research and Development Tax Incentives

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