British Columbia has one of the most attractive investment climates for business in North America.
Manufacturers, for example, enjoy benefits such as:
- Strong economic fundamentals and market opportunities associated with major, long-term projects.
- Low tax rates (personal and corporate) that rank BC among the lowest in Canada – complemented by sales tax exemptions on machinery and tax credits for research and development expenditures.
- Competitive operating costs including low cost electricity relative to elsewhere in Canada or the US.
- Competitive wage rates reflecting a balanced and growing labour pool.
- Growing labour supply with government initiatives that are driving labour mobility into BC and training our existing workforce assets.
- Welcoming communities that keenly encourage new manufacturing and service investments.
- Financial support for capital investments and job creation in northern BC. Contact Northern Development Initiative Trust
The following is a list of programs which contain information about opportunities available to businesses in BC. Certain incentives target particular industries. British Columbia’s tax incentives are provided as “entitlements” – they do not have to be negotiated – and are available equally to all eligible businesses for qualifying activities. Federal government incentives are also available that mirror provincial measures in many cases.
Local Government Tax Incentives
Ask the economic development contact in each community about their local tax incentives:
City of Terrace, Airport Revitalization Tax Exemption and Downtown Revitalization Tax Exemption Programs.
Northern Industry Expansion Program
This loan guarantee partnership agreement targets small and medium-sized businesses in central and northern BC’s resource processing, manufacturing and supply sectors. It provides eligible projects and borrowers with the opportunity to access loan guarantees from Northern Development for up to 25% of a loan with the Business Development Bank of Canada. A total of $15 million has been dedicated to this program by Northern Development. This loan guarantee program expands the capital pool available to small businesses in the region.
Competitiveness Consulting Rebate
The Competitiveness Consulting Rebate provides small and medium sized manufacturers, resource processing companies, and their first line suppliers with a rebate of 50% of the cost of business competitiveness consulting. This will increase productivity, revenues, and profitability for operations located within the Northern Development Initiative Trust region.
The Community Futures Network was established in 1986 by the federal government in response to the severe economic and labour market changes faced by rural Canadian communities. Over the last 25 years Community Futures in BC has played a significant role in entrepreneurial and community development. Community Futures has a significant impact on the socio-economic development and diversification of the rural communities it serves.
Community Futures has the following branches operating in the Northwest region:
- CFDC of 16/37
Serves Atlin, Dease Lake, Kitimat, New Hazelton, Stewart & Terrace.
- CFDC of Haida Gwaii
Serves the Queen Charlotte Islands.
- CFDC of Nadina
Serves Burns Lake, Houston, Smithers & Telkwa.
- CFDC of the Pacific Northwest
Serves Prince Rupert & Port Edward.
Trade and Invest British Columbia
Provides information about the incentives that British Columbia provides including: provincial tax credits, exemptions and deductions to encourage business investment and innovation.
New Business Investment and Acquisitions
Canada is one of the world’s most open economies for foreign investment. Canada welcomes and actively encourages investment by non-Canadians, and places few requirements or restrictions on foreign investors.
Venture Capital Programs
Venture capital programs encourage investors to make equity capital investments in British Columbia small businesses that will enhance and diversify the provincial economy. These programs give small business continuous access to early-stage venture capital to help them develop and expand. The provincial Venture Capital Programs encourage investments in British Columbia businesses by providing British Columbia investors with a 30 per cent refundable tax credit.
Employee Share Ownership Programs
The Employee Share Ownership Program promotes investment by employees in their company by providing them with a 20 per cent provincial income tax credit. Retiring business owners can use an employee share ownership plan to transfer ownership of their company to employees by selling shares directly to their employees, who receive a 20 per cent provincial income tax credit on their investment.
Labour Sponsored Funds Program
The Labour Sponsored Funds Program helps create investment funds that are able to invest in small and medium-sized businesses with high growth potential that need equity financing to achieve success. The goal of this fund is to earn a competitive return for shareholders, through long-term equity investments in small to medium-sized businesses in BC’s emerging markets. BC investors receive a combined federal and provincial tax credit of up to 30 per cent on their investment in a labour-sponsored investment fund. This can be used to reduce their income taxes.
Business Credit Availability Program
In Budget 2009, the Government announced the launch of the Extraordinary Financing Framework (EFF). The Business Credit Availability Program (BCAP) is one element of the EFF, dedicated to improving access to financing for Canadian businesses by providing new resources and flexibilities to Export Development Canada (EDC) and the Business Development Bank of Canada (BDC). Through this program, EDC and BDC will provide at least $5 billion in direct lending and other types of support and facilitation at market rates to businesses with viable business models whose access to financing would otherwise be restricted. By working in close cooperation with private sector lenders, this program will fill gaps in market access and lever additional lending by private sector institutions in cases where joint participation facilitates private action.
BC Provincial Nominee Program
The British Columbia Provincial Nominee Program (BC PNP) accelerates the Permanent Resident application process for skilled and/or experienced workers, experienced business persons and their family members who want to settle in BC permanently. It allows nominees to apply for Permanent Resident status through Citizenship and Immigration Canada (CIC) under the fast-tracked Provincial Nominee stream – which can be faster than applying through many federal immigration streams.
Mining Exploration Tax Credits
The Mining Exploration Tax Credit is available to corporations, partnerships and individuals. The credit applies to exploration for all base and precious metals, coal and some industrial minerals. Exploration expenses may include expenses incurred in the course of prospecting, carrying out geological surveys, trenching, digging test pits, or preliminary sampling. The credit is 20% of qualified mining exploration expenses less the amount of any assistance received or receivable.
To encourage new mine development in the province, the new mine allowance provides for an allowance of one-third of the capital costs of new mines and expansions of existing mines that begin production in reasonable commercial quantities before 2016. This means that 133.3% of qualifying capital expenditures can be added to the cumulative expenditure account of the mine.
Eligible Business Corporation Tax Credits
Tax credits are issued to investors only if the Eligible Business Corporation raised the equity capital under a pre-approved authorization from the Investment Capital Branch and is in compliance with the Small Business Venture Capital Act(the “Act”).
International Business Activity Refund
The International Business Activity program provides a refund of British Columbia income tax paid in respect of income earned in conducting an international business. An eligible corporation must register itself, and any specialists it employs, under the International Business Activity Act to qualify for the program. A description of eligible companies and other information is available online.
Federal & Provincial Scientific Research and Experimental Development Tax Credits
Corporations can apply for both federal and provincial funding.
The British Columbia Scientific Research and Experimental Development (SR&ED) Tax Credit Program is designed to encourage research and development in British Columbia that will lead to new, improved, or technologically advanced products or processes. The program provides tax credits to qualifying corporations that carry on SR&ED in British Columbia. The Canada Revenue Agency (CRA) administers the program on behalf of the province.
In addition to the 10% SR&ED credit offered by the BC provincial government, the federal government also offers a 20-35% tax refund through the Scientific Research and Experimental Development tax incentive program. This is the largest single source of federal government support designed to encourage research and development in Canada. The SR&ED program can provide financial incentives by helping to either fund the scientific and technological advances that keep your company competitive or help better position your company for future SR&ED projects.
The investment tax credit rates and the percentage that you can have refunded or credited vary according to the way your business is structured. Available refund rates through the federal program range from 20 to 35%. The provincial program rates are 10% refundable credit and 10% non-refundable credit.
The Overview of Scientific Research and Experimental Development Tax Incentive Program brochure is an informative source for interested parties.
The CRA has an online tool to help you determine if your work qualifies for the SR&ED tax credit. You can access this self-assessment tool at http://www.cra-arc.gc.ca/txcrdt/sred-rsde/ssssmnt/menu-eng.html
The British Columbia Scientific Research and Experimental Development Tax Credit application form is found here: http://www.cra-arc.gc.ca/E/pbg/tf/t666/t666-08e.pdf
The federal Scientific Research and Experimental Development Expenditures Claim application form can be found here: http://www.cra-arc.gc.ca/E/pbg/tf/t661/t661-11e.pdf
For more information about the provincial and federal SR&ED tax credits, please contact the CRA at 1 866 317-0473 or visit the CRA’s website at www.cra-arc.gc.ca/sred/
Export Development Canada
Export Development Canada (EDC) is Canada's export credit agency, offering innovative financing, insurance and risk management solutions to help Canadian exporters and investors expand their international business.
Business Development Bank of Canada
BDC is the Business Development Bank of Canada. From over 100 business centres across the country, BDC promotes entrepreneurship by providing financing, venture capital and consulting services to Canadian businesses, with a focus on small and medium-sized enterprises (SMEs).
BDC Terrace Business Center: 1-800-663-5035 (in BC)
Canadian Manufacturers & Exporters
The Lean Manufacturing Certificate Program is a Six Day Program (6 modules) designed to meet the training needs of companies adopting the ‘lean approach’ to doing business. It provides theory and application of the key lean tools. It is also intended to allow them to better support the lean approach of their companies who are serious about improving profitability through reducing waste.
MITACS is a federally and provincially funded research network with offices located coast to coast. MITACS brings together academia, industry and the public sector through research and training initiatives to develop cutting edge tools vital to the knowledge-based economy.
BC Renaissance Capital Fund
The BC Renaissance Capital Fund attracts successful venture capital managers and their capital to British Columbia in order to develop promising, innovative technology companies in the Province. The BC Renaissance Capital Fund was created for the purposes of pursuing investment in four key technology sectors: digital media, information technology, life sciences and clean technology.
Other Online Resources
Small Business BC
International Trade Training for Small Business
Business Guide to Canadian Government Programs
Small Business Funding Center
Canadian Assistance Programs Directory
Canada Business Services