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Tax credit for resources
This credit is designed to support exploration activities in Québec, and may be claimed for exploration expenses related to mineral resources, oil and gas, or other resources. Expenses related to renewable energy or energy conservation also qualify for the credit. A corporation must choose between this credit and the flow-through share system.
The credit may also be claimed for mining exploration expenses with respect to cut stone (that is, granite, sandstone, limestone, marble and slate), provided these resources are to be used in the manufacture of:
- dimension stones
- cemetery monuments
- building stones
- paving stones
- curbing
- roof tiles
A portion of this credit is refundable and a portion is (until 2007) non-refundable. The non-refundable portion cannot exceed the corporation's income tax and tax on capital for a taxation year, before calculation of any refundable tax credits (including the refundable portion of the tax credit for resources).
Any balance of the non-refundable portion of the credit for a given taxation year may be carried to the three preceding years (provided those years ended after August 20, 2002) or to the ten subsequent years. This portion of the credit thus applies to eligible expenses incurred after August 20, 2002, but before January 1, 2008.
The tax credit rates are indicated in the table below.
| Corporations that do not develop mineral resources or gas and oil wells | |||
| Tax credit for expenses relating to | Refundable portion | Non-refundable portion | Total |
| Mineral resources | |||
in the Near North or Far North | 38.75% | 6.25% | 45% |
elsewhere in Québec | 35% | 10% | 45% |
| Oil and gas | |||
in the Near North or Far North | 38.75% | n/a | 38.75% |
elsewhere in Québec | 35% | n/a | 35% |
| Renewable energy and energy conservation | 35% | n/a | 35% |
| Other resources (cut stone) | 15% | n/a | 15% |
| Other corporations | |||
| Tax credit for expenses relating to | Refundable portion | Non-refundable portion | Total |
| Mineral resources | |||
in the Near North or Far North | 18.75% | 26.25% | 45% |
elsewhere in Québec | 15% | 30% | 45% |
| Oil and gas | |||
in the Near North or Far North | 18.75% | n/a | 18.75% |
elsewhere in Québec | 15% | n/a | 15% |
| Renewable energy and energy conservation | 30% | n/a | 30% |
| Other resources (cut stone) | 15% | n/a | 15% |
Corporations that may apply for the credit
In order to claim the credit, the corporation must carry on a business in Québec and have an establishment in Québec. If the corporation is a member of a partnership, it may claim the credit for the partnership's eligible expenses or activities.
Expenses giving entitlement to the credit
The expenses incurred by the corporation must be attributable to one of the following:
- exploration expenses that, under the existing flow-through share system, enable individuals to claim a deduction of at least 125%
- expenses that are incurred in Québec with regard to renewable energy or energy conservation, and that currently enable individuals to claim a deduction of 125%
How to apply for the credit
To apply for the credit, the corporation must complete form CO-1029.8.36.EM, Crédit d'impôt remboursable relative aux ressources, and enclose the form with its income tax return or file the form no later than 12 months after the filing deadline for the return.
