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Understanding the Canadian Carbon Tax Rebate: How Your Business Can Benefit

The Canadian carbon tax rebate is designed to provide financial relief to eligible Canadian-controlled private corporations (CCPCs) by offsetting the costs associated with the federal fuel charge.

Key Eligibility Factors

Eligibility is determined by several factors, including business type, employee count, and location. The rebate is only available to CCPCs, not to sole proprietorships or partnerships. If your business operates with subsidiaries, each subsidiary that meets the criteria may qualify for a rebate independently.

How the Carbon Tax Rebate Works

The rebate is automatically issued to eligible CCPCs, so there’s no need to submit a separate application. To qualify, your business must:

  • Be a CCPC for the entire tax year,
  • Employ 499 or fewer employees across Canada, and
  • File the corporate income tax return for the 2023 tax year by the revised deadline of December 31, 2024.

The Canada Revenue Agency (CRA) calculates and distributes the rebate based on your employee count, which is determined by the number of T4 slips issued for full-time, part-time, and seasonal employees.

Payment Amounts

The current rebate calculation is retroactive to 2019-20 and will include up to 2023 based on the following rates for Saskatchewan per T4 filed:

2019-20            $110

2020-21            $271

2021-22            $244

2022-23            $298

2023-24            $233

Payment Timelines

Corporations that filed their 2023 tax return by July 15, 2024, will receive their payment by:

  • December 16, 2024, if registered for direct deposit from the Canada Revenue Agency (CRA); or,
  • December 31, 2024, if receiving payment by cheque.
  • The 2024 payment will be calculated after 2024 tax returns have been filed.

NOTE:  If you did not file your tax return by July 15, 2024, they will allow you to file it before December 31, 2024 and still be considered.

For any questions please contact your trusted Stark & Marsh advisor.

 

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