EBC - Eligible Business Corporation and Tax Credits

[boris]

Companies in BC can register as an Eligible Business Corporation (EBC) in order to give a a 30% tax credit to BC investors.

The Province of BC gives tax credits to individuals and corporations when they invest in EBCs.

EBC Definition

https://www2.gov.bc.ca/gov/content/employment-business/investment-capital/venture-capital-programs/eligible-business-corporation

Direct link to the law

https://www.bclaws.ca/civix/document/id/complete/statreg/10_390_98#section11

Eligibility High Level

Investment Capital Program Guidelines (PDF)

From the PDF:

1. Business must be incorporated and registered to operate in B.C.

2. Business must have a permanent place of business in B.C.

3. Business must pay at least 75% of its annual wages & salaries to B.C. employees

4. Business must be “substantially engaged” in one or more of the qualifying activities

5. Business, together with its corporate affiliates, must not have more than 100 employees

6. Business must have raised at least $25,000 in equity capital

7. Business must have at least 80% of its assets located in B.C.

Tax Credits

Going to individual and corporate investors

https://www2.gov.bc.ca/gov/content/employment-business/investment-capital/venture-capital-programs/eligible-business-corporation/tax-credits

Individual investors are entitled to a 30% refundable tax credit, up to an annual maximum tax credit of $120,000.

eg if a BC investor invests $100K into an EBC, they get $30K in cash back from the government.

Corporate investors are entitled to a 30% non-refundable tax credit, however, there is no annual tax credit limit.

eg. if a BC corporation invests into an EBC, they can only claim it against taxes.