The 2015 Saskatchewan budget, tabled on March 18th, contained changes to a number of existing credits but stopped short of raising tax rates. Below is a brief summary of the tax changes contained in the budget. Please call our office if you have any questions. We would be happy to arrange a meeting to discuss how these measures may apply to your situation, assist you with the preparation and filing of your tax returns, and discuss tax planning opportunities.
Corporate Tax Changes
Research and development tax credit
Effective April 1, 2015, this credit will be reduced from 15% to 10% of qualifying expenditures and will become non-refundable.
Manufacturing and processing exporter tax incentive
A new non-refundable credit was announced for eligible corporations that export at least 25% of their goods either within Canada or internationally. The credit is based on expansion of the number of full-time employees from 2015 through 2019 with an added incentive for “head office” employees.
Adjustments were announced for the potash production tax regime as well as a new tax incentive for eligible primary steel producers.
Personal Tax Changes
Graduate retention program
This credit will change from a refundable to a non-refundable credit beginning in 2015 and effective for all amounts claimed in 2015 and future years even if the date of graduation was prior to 2015. This change means that the credit can only be used to reduce Saskatchewan tax owing and any excess credit will be carried forward to be used in a future year rather than increasing the individual’s tax refund. Graduates will have up to 10 years to claim the credits.
Active families benefit
The provincial refundable credit of up to $150 per child for the costs of eligible activities will be income tested starting in 2015. Families with combined net incomes above $60,000 will no longer be eligible for this credit.
Seniors drug plan
The income threshold to remain eligible for the provincial plan for reduced prescription drug costs for seniors was reduced from $80,000 to $65,000.