Prince Edward Island - Provincial corporation tax

For a summary of the most recent changes, see What's new for corporations.

Lower rate

The lower rate of Prince Edward Island income tax is:

• 4.3% effective April 1, 2007;
• 3.2% effective April 1, 2008;
• 2.1% effective April 1, 2009; and
• 1.0% effective April 1, 2010.

The tax is prorated based on the number of days in the year when the tax year straddles these dates.

This rate applies to:

• taxable income earned in Prince Edward Island that qualifies for the federal small business deduction; and
• a credit union’s income that qualifies for the additional deduction under subsection137(3) of the federal Income Tax Act.

Higher rate

The higher rate of income tax is 16 %. This rate applies to taxable income that does not qualify for the federal small business deduction.

For more information, see Dual tax rates.

Reporting the tax

On line 210 of Schedule 5, Tax Calculation Supplementary - Corporations, enter the amount of tax calculated.

Claiming the credits

Prince Edward Island offers different tax credits. Details of each credit can be found in the following pages and their associated schedules:

• Political contribution tax credit
• Foreign tax credit
• Corporate investment tax credit

Forms and publications

• Schedule 5, Tax Calculation Supplementary - Corporations

Government partners

• Prince Edward Island (provincial site)