Calculating the credit
Your CCUS ITC is equal to the total of both:
The amount by which your cumulative CCUS development tax credit for the year exceeds your cumulative CCUS development tax credit for the immediately preceding taxation year
Your CCUS refurbishment tax credit for the year
Cumulative CCUS development tax credit
Your cumulative CCUS development tax credit for a tax year is the total of the specified percentage of each type of qualified CCUS expenditure incurred in the taxation year or in a previous taxation year and before the first day of commercial operations of the relevant qualified CCUS project.
If you are a member of a partnership
If you are a taxable Canadian corporation who is a member of a partnership, your cumulative CCUS development tax credit for a taxation year also includes your reasonable share of the cumulative CCUS development tax credit computed for the partnership for the taxation year or a previous taxation year.
CCUS refurbishment tax credit
Your CCUS refurbishment tax credit is the total of the specified percentage of each type of qualified CCUS expenditure incurred in the taxation year and during the total CCUS project review period of the relevant qualified CCUS project.
However, the expenditures used to calculate your CCUS refurbishment tax credit are subject to a limit of 10% of total qualified CCUS expenditures incurred before the first day of commercial operations of the qualified CCUS project.
If you are a member of a partnership
If you are a taxable Canadian corporation who is a member of a partnership, your CCUS refurbishment tax credit for a taxation year also includes your reasonable share of the CCUS refurbishment tax credit computed for the partnership for the taxation year.
Credit rates for qualified expenditures
Your credit rate depends on whether you elect to meet the labour requirements.
Refer to: Avoid the reduced tax credit rate
| Type of expenditure | Incurred from 2022 to 2030 | Incurred from 2031 to 2040 |
|---|---|---|
| Qualified carbon capture expenditures incurred to capture carbon directly from ambient air | 60% | 30% |
| Qualified carbon capture expenditures incurred to capture carbon other than directly from ambient air | 50% | 25% |
| Qualified carbon transportation, storage, or use expenditures | 37.5% | 18.75% |
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