Ontario's Bill 85, which enacts certain tax measures announced in the province’s 2023 budget and in the 2022 Fall Economic Update, received Royal Assent on May 18, 2023. The bill includes the new 10% refundable Manufacturing Investment Tax Credit (announced in Ontario’s 2023 budget on March 23, 2023), and alters the phase out of the small business deduction for corporations with taxable capital employed in Canada between $10 million and $50 million (previously the phase-out occurred between $10 million and $15 million of taxable capital) (announced in Ontario’s 2022 Fall Economic Update). Note that the small business deduction changes harmonize with the recent federal amendment to allow more medium-sized Canadian-controlled private corporations (CCPCs) to benefit from the small business deduction, and apply for taxation years beginning on or after April 7, 2022.
The corporate income tax measures in Bill 85 are considered enacted for U.S. GAAP purposes as of May 18, 2023 (the date the bill received Royal Assent). These measures were considered substantively enacted for IFRS and Accounting Standards for Private Enterprise (ASPE) purposes on March 23, 2023, the date the bill received first reading (as Ontario has a majority government).
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Information is current to May 29, 2023. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500
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