Ontario credit union tax reduction

The Ontario credit union tax reduction allows credit unions a special deduction from income tax otherwise payable. It is designed to reduce their overall income tax rate to the same net rate paid by small business corporations that claim the Ontario small business deduction.

To be eligible to claim the Ontario credit union tax reduction, the credit union must meet the following criteria:

• have been a credit union throughout the tax year
• have had a permanent establishment in Ontario at any time in the tax year
• have Ontario taxable income in the year

Claiming the reduction

You can use Part 4 of Schedule 500, Ontario Corporation Tax Calculation, to calculate the Ontario credit union tax reduction. Schedule 500 is a worksheet and you do not have to file it with your return.

File Schedule 17, Credit Union Deductions, with your return.

For more information on the credit, see the schedules and section 35 of the Taxation Act, 2007 (Ontario).

On line 410 of Schedule 5, Tax Calculation Supplementary – Corporations, enter the amount of the reduction you are claiming.

Forms and publications

• Schedule 17, Credit Union Deductions
• Schedule 5, Tax Calculation Supplementary – Corporations

Government partners

• Ontario Ministry of Finance
• Ontario e-Laws