Apprenticeship Job Creation Tax Credit
The Apprenticeship Job Creation Tax Credit (AJCTC) is a non-refundable tax credit equal to 10% of the eligible salaries and wages payable to eligible apprentices in respect of employment after May 1, 2006. The maximum credit an employer can claim is $2,000 per year for each eligible apprentice. If your business hires an eligible apprentice, you qualify to claim the credit.
Determining if the apprentice is eligible
An eligible apprentice is someone who is working in a prescribed trade in the first two years of their apprenticeship contract. This contract must be registered with a federal, provincial, or territorial government under an apprenticeship program designed to certify or license individuals in the trade.
A prescribed trade includes the trades currently listed as Red Seal Trades. For more information, see Red Seal Program.
Claiming the credit
If you are an employer, you will be able to claim the AJCTC on your individual income tax return, on line 412 – Investment tax credit, by filing Form T2038(IND), Investment Tax Credit (Individuals).
Also, any unused credit may be carried back 3 years and carried forward 20 years.
When two or more related employers employ the same apprentice, special rules apply to ensure that the $2,000 limit is allocated to only one employer.
Forms and publications
- General Income tax and benefit package
- T2 Corporation - Income Tax Guide (T4012)
- Form T2SCH31 Investment Tax Credit - Corporations
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