Ontario book publishing tax credit
The Ontario book publishing tax credit is a refundable tax credit of 30% on the qualifying expenditures incurred during a tax year for an eligible literary work, by an Ontario book publishing company, up to a maximum credit of $30,000 per work.
Qualifying expenditures include the following expenditures the corporation incurred in publishing an eligible literary work:
- pre-production costs
- marketing expenditures incurred 12 months before to 12 months after the date the literary work is published
- 50% of the production costs
- 100% of expenditures incurred that reasonably relate to preparing a literary work for publishing in one or more digital or electronic formats
- 50% of expenditures incurred that reasonably relate to transferring a prepared digital or electronic version of the literary work into or onto a form suitable for distribution
The credit is available for any number of literary works by a Canadian author in an eligible category.
Qualifying expenditures are reduced by any assistance reasonably related to these expenditures.
You can get a certificate of eligibility from Ontario Creates. To be eligible for the credit, a corporation must meet certain criteria, including all of the following:
- be a Canadian-controlled corporation throughout the tax year, as determined under sections 26 to 28 of the Investment Canada Act
- carry on a book publishing business primarily through a permanent establishment in Ontario for the tax year
- not be exempt from tax under Part III of the Taxation Act, 2007 (Ontario) for the tax year
- not be controlled by the author of the literary work, or by a person not dealing at arm's length with the author
Claiming the credit
Before claiming the credit, you must apply online to Ontario Creates for a certificate of eligibility. If the literary work is eligible, Ontario Creates will issue the certificate.
To claim the credit, file the following with your T2 Corporation Income Tax Return for the year for each literary work:
- a certificate of eligibility (or copy) issued by Ontario Creates
- a completed Schedule 564, Ontario Book Publishing Tax Credit
If you file your return electronically, see T2 Attach-a-Doc.
If you file a paper return, send the return and required attachments to your tax centre.
On line 466 of Schedule 5, Tax Calculation Supplementary – Corporations, enter the total amount of the credit you are claiming.
The CRA will not begin to process the media tax credit claim until it receives all of the required documentation. A claim is considered to be complete when all of the above documentation is filed with the CRA.
For more information on the credit, see Schedule 564, section 95 of the Taxation Act, 2007 (Ontario), and After you file your claim for Ontario refundable media tax credits.
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