On January 16, 2017 the Alberta Government has introduced a new Alberta Investors Tax Credit, providing a tax credit for investments in private, early stage companies in Alberta (Dentons).
Under the terms of the legislation, the province provides tax credits of 30% calculated on the gross amount of the investment. For individuals the tax credit is refundable, so individual investors will get a tax refund if their Alberta tax liability is less than $30,000. For corporate investors, the tax credit is deducted from tax otherwise payable.
A quick read of the review by Dentons indicates that it was copied almost word for word from BC’s Small Business Venture Capital Act. It seems that both provinces cap the tax credits each year at about $30 million, so businesses need to register early to avoid disappointment.
In BC, if companies arrange for offerings that are eligible, they need to quickly file Share Purchase Reports to ensure that their investors receive the tax credit. So waiting until the end of the calendar year isn’t advisable.