Canada Revenue Agency
www.cra.gc.ca
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Ontario - Provincial corporation tax
Important notice
Changes have been announced to the Ontario basic income tax rate. Go to What's new for corporations.
Basic rate
The Ontario basic income tax rate is:
- 14% before July 1, 2010;
- 12% effective July 1, 2010;
- 11.5%, effective July 1, 2011;
- 11% effective July 1, 2012; and
- 10% effective July 1, 2013.
The tax is prorated based on the number of days in the year when the tax year straddles these dates.
Lower rate
The Ontario small business deduction reduces Ontario basic income tax, resulting in a lower tax rate of 4.5%. Before July 1, 2010, the small business lower tax rate was 5.5%.
Reporting the tax
The T2 return includes the following Ontario corporation taxes:
- Basic income tax
- Surtax re Ontario small business deduction
- Corporate minimum tax
- Special additional tax re life insurance
- Capital tax
- Additional tax re Crown royalties
You can use Schedule 500, Ontario Corporation Tax Calculation, to calculate your Ontario basic income tax. Schedule 500 is a worksheet and does not have to be filed with your return.
On line 270 of Schedule 5, Tax Calculation Supplementary - Corporations, enter the amount of basic income tax calculated.
Transitional measures
The Ontario transitional tax debits and credits provide a transition from the Corporations Tax Act (Ontario) for corporations with different income tax attributes for federal and Ontario purposes.
Claiming the credits
Ontario offers different tax credits. Details of each credit can be found in the following pages and their associated schedules:
- Apprenticeship training tax credit
- Business-research institute tax credit
- Capital gains refund
- Co-operative education tax credit
- Corporate minimum tax credit
- Credit union tax reduction
- Foreign tax credit
- Innovation tax credit
- Political contributions tax credit
- Qualifying environmental trust tax credit
- Refundable media tax credits
- Book publishing tax credit
- Computer animation and special effects tax credit
- Interactive digital media tax credit
- Film and television tax credit
- Production services tax credit
- Sound recording tax credit
- Research and development tax credit
- Resource tax credit
- Tax credit for manufacturing and processing
