Ontario capital tax on other than financial institutions

The rates of capital tax payable by a corporation that is other than a financial institution are:

Election

Eligible corporations that are associated with other eligible corporations in a tax year may elect under subsection 83(2) of the Taxation Act, 2007 (Ontario), to allocate the associated group's net capital deduction. File a completed Schedule 516, Capital Deduction Election of Associated Group for the Allocation of Net Deduction, with your return.

Capital tax credit for manufacturers

A manufacturing corporation whose Ontario manufacturing labour cost is more than 20% of its total Ontario labour cost for the year can claim a capital tax credit for manufacturers. If the corporation's manufacturing labour cost is at least 50% of its total Ontario labour cost for the year, this credit will equal the amount of capital tax otherwise payable. If the corporation's manufacturing labour cost is less than 50% but more than 20% of its total Ontario labour cost for the year, the credit is calculated as the capital tax otherwise payable, reduced proportionately on a straight-line basis. Calculate the tax credit in Part 4 of Schedule 515, Ontario Capital Tax on Other Than Financial Institutions.

Reporting capital tax payable

To calculate the capital tax payable by a corporation other than a financial institution, complete the following:

• Schedule 33, Part I.3 Tax on Large Corporations; and
• Schedule 515, Ontario Capital Tax on Other Than Financial Institutions.

File completed Schedules 33 and 515 and, if applicable, Schedule 516 with your T2 return within six months of the end of the tax year.

On line 282 of Schedule 5, Tax Calculation Supplementary - Corporations, enter the Ontario capital tax payable.

Forms and publications

• Schedule 5, Tax Calculation Supplementary - Corporations
• Schedule 33, Part I.3 Tax on Large Corporations
• Schedule 515, Ontario Capital Tax on Other Than Financial Institutions
• Schedule 516, Capital Deduction Election of Associated Group for the Allocation of Net Deduction

Government partners

• Ontario (Ministry of Revenue)
• Ontario (e-Laws)