Film and media tax credits - COVID-19 topics

You can claim the following costs for the Film or video production services tax credit (PSTC) if they were required due to COVID-19 and they meet the criteria in the definition of Canadian labour expenditure in subsection 125.5(1) of the Income Tax Act:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

You cannot claim non-labour costs, such as the cost of a test kit, cleaning supplies and equipment or personal protective equipment, as they are not eligible Canadian labour expenditures.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible Canadian labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible Canadian labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible Canadian labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

If the production never started principal photography, it is not eligible for the PSTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as Canadian labour expenditures for your PSTC claim.

In some situations, your PSTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the Canadian film or video production tax credit (CPTC) if they were required due to COVID-19 and they meet all of the criteria found in the definition of labour expenditure in subsection 125.4(1) of the Income Tax Act:

• medical personnel costs
• health and safety personnel costs
• labour costs relating to COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not eligible labour expenditures but may be claimed as production costs.

Where a production was terminated and never completed, payments made for suspension, severance, relief or retention are not eligible labour expenditures, because they do not relate to services rendered and are not directly attributable to the production. They are not production costs either, because they were not incurred for the creation and filming of the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible labour expenditures because they do not relate to services rendered and are not directly attributable to the production. They are not production costs either, because they were not incurred for the creation and filming of the production.

Deposits or advances that the corporation paid to vendors but forfeited due to COVID-19 are not eligible labour expenditures, because they do not relate to services rendered and are not directly attributable to the production. They are not production costs either, because they were not incurred for the creation and filming of the production.

Where a production began principal photography and the production was then temporarily halted due to COVID-19, you may have made studio hold payments to retain the studio during the suspension. These payments are not eligible as production costs, because no production activities took place at the time.

If the production was never completed, it is not eligible for the CPTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as production costs for your CPTC claim.

In some situations, your CPTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the British Columbia production services tax credit (BCPSTC) if they were required due to COVID-19 and they meet the criteria in the definition of BC labour expenditure in subsection 79(1) of the British Columbia Income Tax Act:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

You cannot claim non-labour costs, such as the cost of a test kit, cleaning supplies and equipment or personal protective equipment, as they are not eligible BC labour expenditures.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible BC labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible BC labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible BC labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

If the production never started principal photography, it is not eligible for the BCPSTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as BC labour expenditures for your BCPSTC claim.

In some situations, your BCPSTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the British Columbia film and television tax credit (BCFTTC) if they were required due to COVID-19 and they meet the criteria in the definition of BC labour expenditure in subsection 79(1) of the British Columbia Income Tax Act:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment or personal protective equipment, are not eligible BC labour expenditures but may be claimed as production costs.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible BC labour expenditures, because they do not relate to services rendered and are not directly attributable to the production. They are not production costs either, because they were not incurred for the creation and filming of the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible BC labour expenditures, because they do not relate to services rendered and are not directly attributable to the production. They are not production costs either, because they were not incurred for the creation and filming of the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible BC labour expenditures, because they do not relate to services rendered and are not directly attributable to the production. They are not production costs either, because they were not incurred for the creation and filming of the production.

Where a production began principal photography and the production was then temporarily halted due to COVID-19, you may have made studio hold payments to retain the studio during the suspension. These payments are not eligible as production costs, because no production activities took place at the time.

If the production was never completed, it is not eligible for the BCFTTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as production costs for your BCFTTC claim.

In some situations, your BCFTTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you must report as assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs as eligible salaries for the Manitoba film and video production tax credit (MBFVPTC) if they were required due to COVID-19 and they meet the criteria in the definition of eligible salaries in subsection 7.5(1) of the Manitoba Income Tax Act:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

You cannot claim non-labour costs, such as the cost of a test kit, cleaning supplies and equipment or personal protective equipment, as they are not eligible for the cost of salaries credit.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible salaries, because they do not relate to services rendered and are not directly attributable to the production.

Where a production was halted temporarily or terminated, above-the-line "pay or play" payments are not eligible salaries, because they do not relate to services rendered and are not directly attributable to the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible salaries, because they do not relate to services rendered and are not directly attributable to the production.

If the production was never completed, it is nnot eligible for the MBFVPTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as government assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as eligible salaries for your MBFVPTC claim.

In some situations, your MBFVPTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you may need to report as government assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the Manitoba film and video production tax credit (MBFVPTC) if they were required due to COVID-19 and they meet the criteria found in the definitions of eligible salaries and eligible service contract expenditure in subsection 7.5(1) of the Manitoba Income Tax Act.

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are eligible costs for the MBFVPTC if they meet the criteria for eligible tangible property expenditure in subsection 7.5(1) of the Manitoba Income Tax Act.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible as salaries, service contract expenditures or tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible as salaries, service contract expenditures or tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible as salaries, service contract expenditures or tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production began principal photography that was then temporarily halted due to COVID-19, you may have made studio hold payments to retain the studio during the suspension. These payments are not eligible tangible property expenditures, because no production activities were taking place at the time.

If the production was never completed, it is not eligible for the MBFVPTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy for your employees, you have to report the amount as government assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as eligible salaries for your MBFVPTC claim.

In some situations, your MBFVPTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as government assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the Ontario production services tax credit (OPSTC) if they were required due to COVID-19 and they meet the criteria for eligible wage expenditure and eligible service contract expenditure as set out in subsections 92(5.2) and 92(5.3) of the Taxation Act, 2007:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, and personal protective equipment, are eligible for the OPSTC if they meet the criteria for eligible tangible property expenditure as set out in subsection 92(5.7) of the Taxation Act, 2007.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible as wage or service contract expenditures or as tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible wage or service contract expenditures or eligible tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible service contract expenditures or eligible tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production began principal photography that was then temporarily halted due to COVID-19, you may have made studio hold payments to retain the studio during the suspension. These payments are not eligible tangible property expenditures, because no production activities took place at the time.

If the production never started principal photography, it is not eligible for the OPSTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as eligible wage expenditures for your OPSTC claim.

In some situations, your OPSTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the Ontario film and television tax credit (OFTTC) if they were required due to COVID-19 and they meet all criteria for Ontario labour expenditure as set out in subsection 30(1) of Ontario Regulation 37/09.

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not eligible Ontario labour expenditures.

Where a production was halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible Ontario labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Where a production was terminated and never completed, above-the-line "pay or play" payments are not eligible Ontario labour expenditures, because they do not relate to services rendered and are not directly attributable to the production.

Deposits or advances that the corporation paid to vendors and then forfeited due to COVID-19 are not eligible service contract expenditures or eligible tangible property expenditures, because they do not relate to services rendered and are not directly attributable to the production.

If the production was never completed, it isn't eligible for the OFTTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as Ontario labour expenditure for your OFTTC claim.

In some situations, your OFTTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs for the Ontario computer animation and special effects (OCASE) tax credit if they were required due to COVID-19 and they meet the criteria for Ontario labour expenditure as set out in section 25 of Ontario Regulation 37/09:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not eligible Ontario labour expenditures.

Where a production is halted temporarily or terminated, payments made for suspension, severance, relief or retention are not eligible Ontario labour expenditures, because they do not relate to activities undertaken and are not directly attributable to the production.

To claim the OCASE tax credit, the corporation must have performed eligible computer animation and special effects activities at a permanent establishment that it operates in Ontario. This corporation must pay qualifying wage amounts to its employees who reported to its permanent establishment in Ontario where the eligible activities were undertaken. Qualifying remuneration amounts must be paid for activities undertaken at a permanent establishment in Ontario of the corporation that is applying for OCASE, an Ontario resident individual who is not an employee of the OCASE applicant, or an eligible partnership.

Employees and contractors may work remotely and not be physically present at the corporation's permanent establishment, especially in light of social distancing and provincial health and safety requirements due to COVID-19. Wages and remuneration for employees and contractors who work remotely are eligible Ontario labour expenditures (assuming all other requirements are met) if the individuals report to, and are under the direction of, the OCASE applicant, and the activities are undertaken in Ontario.

The OCASE tax credit may be claimed for an eligible production. An eligible production must have been issued either an Ontario film and television tax credit (OFTTC) certificate or an Ontario production services tax credit (OPSTC) certificate.

If a production claiming an OFTTC is never completed, it won't be issued an OFTTC certificate and isn't eligible for the OCASE tax credit.

If a production claiming an OPSTC never started principal photography, it won't be issued an OPSTC certificate and isn't eligible for the OCASE tax credit.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as Ontario labour expenditures for your OCASE tax credit claim.

In some situations, your OCASE tax credit claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

Specified and non-specified products

You can claim the following costs as eligible Ontario labour expenditures for the Ontario interactive digital media tax credit (OIDMTC) for specified and non-specified products if they were required due to COVID-19 and meet all other criteria for the credit:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not eligible Ontario labour expenditures.

Qualifying digital game corporation

Qualifying digital game corporations claiming the OIDMTC under section 93.1 of the Taxation Act, 2007 can claim the following costs as eligible Ontario labour expenditures if they were required due to COVID-19 and they meet all other criteria for the credit:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not eligible Ontario labour expenditures.

Specialized digital game corporation

Specialized digital game corporations claiming the OIDMTC under section 93.2 of the Taxation Act, 2007 can claim the following costs as eligible Ontario labour expenditures if they were required due to COVID-19 and they meet all other criteria for the credit:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not eligible Ontario labour expenditures.

Specified and non-specified products

To claim the OIDMTC for a specified or non-specified product, a corporation must have developed an eligible product at a permanent establishment that it operates in Ontario. Qualifying wage amounts must be paid to employees who reported to the permanent establishment in Ontario of the qualifying corporation (the OIDMTC applicant company), where the eligible product was developed. Qualifying remuneration amounts must be paid for services rendered at a permanent establishment in Ontario of the OIDMTC applicant, an Ontario resident individual who is not an employee of the OIDMTC applicant, or an eligible partnership.

Employees and contractors may work remotely and not be physically present at the permanent establishment of the OIDMTC applicant, especially in light of social distancing and provincial health and safety requirements due to COVID-19. Wages and remuneration for employees and contractors working remotely will be considered eligible Ontario labour expenditures (assuming all other requirements are met) so long as the individuals are reporting to and under the direction of the OIDMTC applicant and the activities are undertaken in Ontario.

Qualifying digital game corporation and specialized digital game corporation

To be a qualifying digital game corporation or specialized digital game corporation for purposes of claiming the OIDMTC, a company must have carried on a business, at a permanent establishment in Ontario, that includes the development of digital games. Qualifying wage amounts must be paid to employees who reported to the permanent establishment in Ontario of the qualifying digital game corporation or specialized digital game corporation (the OIDMTC applicant company), where the eligible digital game was developed. Qualifying remuneration amounts must be paid for services rendered at a permanent establishment in Ontario of the OIDMTC applicant, an Ontario resident individual who is not an employee of the OIDMTC applicant, or an eligible partnership.

Employees and contractors may work remotely and not be physically present at the permanent establishment of the OIDMTC applicant, especially in light of social distancing and provincial health and safety requirements due to COVID-19. Wages and remuneration for employees and contractors working remotely will be considered eligible Ontario labour expenditures (assuming all other requirements are met) so long as the individuals are reporting to and under the direction of the OIDMTC applicant and the activities are undertaken in Ontario.

If the specified or non-specified product was never completed, it isn’t eligible for the OIDMTC.

Qualifying digital game corporation

If the minimum threshold of $1 million in Ontario labour expenditures over a three-year period is not met, the digital game is not eligible for the OIDMTC.

Specialized digital game corporation

For tax years that start after April 11, 2019, the corporation must incur $500,000 in Ontario labour expenditures related to the development of eligible digital games in the tax year. If it does not meet this minimum, the corporation is not eligible for the OIDMTC.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as government assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as Ontario labour expenditures for your OIDMTC claim.

In some situations, your OIDMTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as government assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.

You can claim the following costs as qualifying expenditures for the Ontario book publishing tax credit (OBPTC) if they were required due to COVID-19, were for activities that reasonably relate to the publishing of an eligible literary work or preparing a literary work for publication in one or more digital formats, and the activities are carried out primarily in Ontario:

• medical personnel costs
• health and safety personnel costs
• labour costs for COVID-19 testing, cleaning and sanitation

Non-labour costs, such as the cost of a test kit, cleaning supplies and equipment, or personal protective equipment, are not qualifying expenditures.

If your corporation received the Canada emergency wage subsidy (CEWS) or the Canada recovery hiring program (CRHP) subsidy, you have to report the amount as government assistance. Report the amount of CEWS or CRHP that relates to salaries or wages included as qualifying expenditures for your OBPTC claim.

In some situations, your OBPTC claim may also include remuneration to a service provider that received CEWS or CRHP for its employees who worked on your production. In this case, you have to report as government assistance the CEWS or CRHP amount that the service provider received for these employees. If you cannot find out what this amount is, we will accept a reasonable estimate.