British Columbia production services tax credit

The production services tax credits are available to both domestic and foreign producers and there is no Canadian content requirement.

To claim these credits, the corporation must have a permanent establishment in British Columbia during the tax year and its main activity throughout the tax year must be a film or video production business or a film or video production services business.

The production services tax credit cannot be claimed if the British Columbia film and television tax credit is claimed for that production.

These credits are refundable, but must first be applied against total taxes payable. There are no carry-back or carry-forward provisions.

There is no expiry date for these credits.

These credits apply to BC-labour expenditures. A BC-based individual is a person who is resident in the province on December 31 of the year preceding the end of the tax year for which the tax credit is claimed. For productions that started principal photography before February 20, 2008, a BC-based individual was defined for the entire length of a production based on the residency status of the individual in the calendar year that precedes the year principal photography begins.

Credits

An accredited production corporation can claim these different credits:

• production services tax credit;
• additional production services tax credit;
• regional production services tax credit;
• distant location production services tax credit; and
• digital animation or visual effects production services tax credit.

Production services tax credit

This credit is equal to 18% of the corporation's accredited qualified BC labour expenditure for the tax year.

If you are not eligible for and do not claim this credit, you cannot claim any of the following credits.

Additional production services tax credit

This credit is equal to 7% of accredited qualified BC labour expenditures incurred after December 31, 2007.

For productions with principal photography that begins after February 28, 2010, the total of the production services tax credit and the additional production services tax credit is increased to 33% from 25% on the amount of BC labour expenditures incurred after February 28, 2010.

Regional production services tax credit

This credit is equal to 6% of the accredited qualified BC labour expenditure for the production for the tax year, where a minimum of five days and more than 50% of the total principal photography days in British Columbia are done outside of the designated Vancouver area.

The credit is prorated for the number of days of principal photography done in British Columbia outside the designated Vancouver area over the total number of days of principal photography performed in British Columbia.

Distant location production services tax credit

This credit is is available for productions that start principal photography after February 19, 2008, when principal photography is done in British Columbia in a distant location.

The distant location is that part of British Columbia that is not included within the area that extends from the designated Vancouver area north, up to and including Whistler and east to include Hope and not within the Capital Regional District.

The distant location production services tax credit is equal to 6% of the accredited qualified BC labour expenditure for the production for the tax year, where a minimum of one day of principal photography is in a distant location.

The accredited qualified BC labour expenditure must be incurred after December 31, 2007.

The credit is prorated for the number of days of principal photography done in a distant location, over the total number of days of principal photography performed in British Columbia. It can only be claimed if the corporation is eligible for and claims the regional production services tax credit.

Digital animation or visual effects production services tax credit

This credit is equal to 15% of accredited qualified BC labour expenditure directly attributable to prescribed digital animation or visual effects activities. 

For productions with principal photography that begins after February 28, 2010, the digital animation or visual effects production services tax credit is increased to 17.5% from 15% on the amount of BC labour expenditures incurred after February 28, 2010.

Claiming the credit

To claim these credits, attach the following on top of the return for the year:

• the accreditation certificate requested from British Columbia Film; and
• a completed Form T1197, British Columbia Production Services Tax Credit, for each film or video production.

For more information about these credits, see Part 5 of the British Columbia Income Tax Act.

On line 672 of Schedule 5, Tax Calculation Supplementary - Corporations, enter the amount of credit you are claiming.

You must claim these credits no later than 36 months after the end of the tax year.

Forms and publications

• Form T1197, British Columbia Production Services Tax Credit
• Schedule 5, Tax Calculation Supplementary - Corporations
• CIT 010, British Columbia Production Services Tax Credit
• CIT 011, British Columbia Digital Animation or Visual Effects Tax Credit

Government partners

• British Columbia (provincial site)