Bulletin: Updated Program Guidelines for the Canadian Film or Video Production Tax Credit Program

Gatineau, March 3, 2020

The Canadian Audio-Visual Certification Office (CAVCO) has published updated guidelines for the Canadian Film or Video Production Tax Credit (CPTC) program. They are available on CAVCO's website in both HTML and PDF formats. These new guidelines take effect immediately. They replace the previous CPTC guidelines issued on April 2, 2012.

The primary objectives of this update were to:

A summary of changes can be found in the table below.

For more information

Clients with questions about these new guidelines can send them to CAVCO by e-mail (PCH.bcpac-cavco.PCH@canada.ca) or call toll-free at 1-888-433-2200 (Teletypewriter toll-free: 1-888-997-3123).

Summary of Changes
Chapter (New guidelines) Title (New guidelines) Additions / Revisions
Overview N/A
  • Presenting overview of CPTC program in a question and answer format
  • New section with overview of Film or Video Production Services Tax Credit (PSTC) program
  • New clarification (from CAVCO Public Notice 2017-01) on types of audiovisual content that are eligible for CPTC certification
  • Other minor revisions to wording to improve clarity and readability
Chapter 1 Administration of the CPTC Program
  • A Part A certificate will now include an estimate of the total estimated tax credit for the production, in addition to amounts previously included
  • New section clarifying the certification of episodes in a series
  • Clarifying the application of subsection 164(1) of the Income Tax Act (timeframe for issuance of a tax credit in the form of a refund)
  • New section explaining the claiming of a capital cost allowance for a CPTC-certified production
  • Clarifying that CAVCO may request a copy of a production at the Part A application stage where necessary
  • Adding detail on the "Application Review Process" at CAVCO, including a graphic explaining different phases of review and corresponding file status messages seen by an applicant
  • Expanding section on Part B application and certification deadlines, by incorporating information from CAVCO’s website and CAVCO Public Notice 2013-01 on the calculation of deadlines and the requirements for filing CRA T2029 waivers
  • Explaining process for applying to the Federal Court for judicial review of a final decision on CPTC certification
  • Expanding section on Preliminary Opinions of Eligibility (Pre-assessments) to detail required information that must be included in a request
  • New section explaining the confidentiality of taxpayer information in the context of the CPTC program
  • Other minor revisions to wording to improve clarity and readability
Chapter 2 Corporate Eligibility Requirements
  • Minor revisions to wording to improve clarity and readability
Chapter 3 Copyright Ownership
  • Reflecting 2014 updates to the Income Tax Regulations:
    • Defining "copyright owner", including by reference to the Copyright Act
    • Expanding definition of "prescribed person"
  • Noting potential impact on how a Capital Cost Allowance is claimed when there are multiple copyright owners
  • Clarifying the documentation used by CAVCO to verify that copyright ownership requirements are met
  • Explaining required documentation needed to demonstrate that an individual or entity is a prescribed person
  • Clarifying issues related to the involvement in a production of an individual / entity that is not a prescribed person
Chapter 4 Ineligible Production Genres
  • Incorporating text from CAVCO Public Notices 2017-02 and 2017-03 (Definitions for ineligible production genres)
  • Reflecting 2016 update to the Income Tax Regulations removing "talk show" as an ineligible production genre
  • Clarifying information used in assessing whether a production falls under an ineligible genre definition
  • Additional "key things to know" clarifications on approach to each ineligible genre
Chapter 5 Treaty Coproductions
  • Expanding section on treaty coproductions including:
    • Clarification of respective roles of Telefilm Canada and CAVCO in coproduction certification
    • Summary of which CPTC requirements are different for treaty coproductions vs. other Canadian film or video productions
  • Other minor revisions to wording to improve clarity and readability
Chapter 6 Key Creative and Producer-Related Personnel
  • Key creative point system tables for live action and animation productions updated to clarify which points are mandatory points
  • Clarifying the information that CAVCO looks at in determining who is occupying key creative or producer-related roles on a production
  • Integrating the text of the lead performer / lead voice policy (CAVCO Public Notice 2014-01)
  • Clarifying that in most circumstances, the involvement of a non-Canadian showrunner on a production will mean the production is ineligible for the two screenwriter points
  • Removing requirement for the position of production manager to in all cases be held by a Canadian
  • Removing chain-of-title documentation as a mandatory part of an application; will be requested when required
  • Clarifying the use of different producer-related credits besides those listed as Group A and Group B credits
  • Removing need for CAVCO Personnel Numbers (for Canadians) or affidavits (for non-Canadians) for broadcaster / distributor representatives, in specified circumstances
  • Other minor revisions to wording to improve clarity and readability
Chapter 7 Financial Information
  • Clearer overview of amounts relevant to the calculation of the tax credit (production costs, labour expenditure, qualified labour expenditure), and including a sample tax credit calculation
  • Additional clarification on eligible production costs (including text from CAVCO Public Notice 2017-01)
  • Link to the CRA's application policy on "assistance"
  • Clarifying treatment of funding received from the Canada Media Fund
  • Shifting of budget thresholds to remove requirement for review engagement reports
  • Explaining the categorization of Canadian vs. non-Canadian costs in context of audit
  • New section explaining restriction on tax shelter investments
  • Other minor revisions to wording to improve clarity and readability
Chapter 8 Exploitation of a Production
  • Clarifying approach to limitations on exploitation term where terms are renewable
  • Incorporating information from CAVCO Public Notice 2017-01, including:
    • Platforms that can be used to meet the "shown in Canada" requirement
    • Clarification regarding role of a distributor
    • Eligibility of online-only productions
    • Additional clarification of restriction on distribution in Canada by a non-Canadian entity
    • Clarification on use of non-Canadian exhibitors
  • Expansion of videogram policy to include non-Canadian service agents performing similar functions in context of online productions
  • Expanded clarification of approach to exploitation rights in context of format productions
  • Other minor revisions to wording to improve clarity and readability
Removed Part 2 – How to Apply
  • Removed due to fact that the section largely duplicated information already found on CAVCO's website or within the online application
  • Where necessary, information from this part has been integrated into the new guidelines
Removed Part 3 – Definitions
  • Removed to avoid duplication of information already found in the main section of the guidelines, and to avoid confusion caused by the inclusion of definitions not relevant to determining eligibility for CPTC certification
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