Taxes
For Canadian-controlled private corporations claiming the small business deduction, the next tax rate is 11%. For the other corporations, the next tax rate is 15%, effective January 01, 2012. The Canadian federal government sets a federal corporate tax rate that is uniform across the country and is combined with the Ontario tax rate.
Corporate Income Tax Rates 2012
| General Statutory Corporate Income Tax Rates |
| Type of Income |
Canada |
Ontario |
Combined |
| General |
15.0% |
11.5% |
26.5% |
Municipal Property Tax Rates 2012
Property taxes for commercial, industrial and residential sites are calculated according to property values determined by the Ontario Property Assessment Corporation. Assessment values are multiplied by the applicable tax rate for each class of property.
The following is a sample calculation of annual property taxes on an Industrial property with an assessed value of $1,000,000:
Assessed Value – $1,000,000 / Total Taxation = $1,000,000 X .04166532 = $41,665.32
R&D Tax Credits
Both Canada and the United States provide special incentives in the form of tax credits for companies engaged in qualifying R&D activities. Go to R&D Incentives in this web site for details.
Real after tax cost of a $100 R&D Expenditure
2012 taxation year |
|
Small and medium-sized non-manufacturers1
(Public, Private or Foreign-owned) |
R&D
Expenditures
($ CDN) |
R&D Expenditures
at Eligible Ontario
Research Institutes2
($ CDN) |
| Gross expenditure |
$100
|
$100.00 |
| After-tax cost of $100 Expenditures |
$51.57 |
$40.114 |
Source - Reviewed by Canada Revenue Agency, Ontario Region: Ministry of Finance, May/June 2008 (9/008)
1 Medium-sized companies have taxable income of less than $400,000 and taxable capital of less than $50 million.
2 Eligible Ontario research institutes include universities, colleges of applied arts and technology, research hospitals and other entities in Ontario.
