This consolidation is unofficial and is for reference only.

For the official version of the regulations, consult the original documents on file with the Registry of Regulations , or refer to the Royal Gazette

Part II .

Regulations are amended frequently.

Please check the list of Regulations by Act to see if there are any recent amendments to these regulations filed with our office that are not yet included in this consolidation.

Although every effort has been made to ensure the accuracy of this electronic version, the Registry of Regulations assumes no responsibility for any discrepancies that may have resulted from reformatting.

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Film Industry Tax Credit Regulations

made under

Section 47 of the

Income Tax Act

R.S.N.S. 1989, c. 217

O.I.C. 96-38 (January 23, 1996), N.S. Reg. 15/96

as amended to O.I.C. 2011-296 (August 2, 2011, effective Dec. 1, 2010), N.S. Reg. 249/2011

1 These regulations may be cited as the Film Industry Tax Credit Regulations .

2 All terms defined in the Income Tax Act have the same meaning in these regulations,

unless otherwise defined.

(1) In

Section 47 of the Act and these regulations,

(a) “Act” means the Income Tax Act (Nova Scotia);

Clause 3(1)(

b) repealed: O.I.C. 2007-580, N.S. Reg. 422/2007.

Clause 3(1)(

c) repealed: O.I.C. 2007-580, N.S. Reg. 422/2007.

Clause 3(1)(

d) repealed: O.I.C. 2007-580, N.S. Reg. 422/2007.

(e) “eligible corporation” means a corporation that meets the criteria set out in

Section 5;

Clause 3(1)(

e) replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

(f) “eligible employee” means

(

i) before December 1, 2010, an employee of an eligible corporation who

was resident in the Province on the last day of the calendar year

preceding the year in which the eligible salary was earned, and

(ii) on or after December 1, 2010, an employee of an eligible corporation

who was resident in the Province for tax purposes during the production

period;

Clause 3(1)(

f) added: O.I.C. 2007-580, N.S. Reg. 422/2007; replaced: O.I.C. 2011-296, N.S. Reg. 249/2011.

(fa) “eligible film” means a film or video that meets the criteria set out in

Section

Clause 3(1)(fa) added: O.I.C. 2007-580, N.S. Reg. 422/2007.

(fb) “eligible individual” means

(

i) before December 1, 2010, an individual who was resident in the

Province on the last day of the calendar year preceding the year in which

the eligible salary was earned, and

(ii) on or after December 1, 2010, an individual who was resident in the

Province for tax purposes during the production period;

Clause 3(1)(fb) replaced: O.I.C. 2011-296, N.S. Reg. 249/2011.

(g) “eligible salaries” of a corporation for a taxation year in respect of an eligible

film means the total of the following amounts to the extent that they are

reasonable in the circumstances and included in the cost of the eligible film:

Clause 3(1)(

g) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(

i) the salaries or wages of eligible individuals that are directly attributable

to the production of the eligible film, that are incurred by the corporation

after 1994 and before 2016 in the taxation year, or the preceding taxation

year, for the stages of production of the eligible film, from the end of the

final script stage to the end of the post-production stage, and that are paid

by the corporation in the taxation year or no later than 60 days after the

end of the taxation year, other than amounts incurred in that preceding

taxation year that were paid no later than 60 days after the end of that

preceding taxation year,

Clause 3(1)(g)(

i) replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

(ii) that portion of the remuneration, other than salary or wages and other

than remuneration that relates to services rendered in the preceding

taxation year and that was paid no later than 60 days after the end of that

preceding taxation year, that is directly attributable to the production of

the eligible film, that relates to services rendered to the corporation after

1994 and before 2016 in the taxation year for the stages of production of

the eligible film, from the end of the final script stage to the end of the

post-production stage, and that is paid by the corporation in the taxation

year or no later than 60 days after the end of the taxation year to

Clause 3(1)(g)(ii) replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

(

A) an eligible individual who is not an employee of the corporation, to

the extent that the amount paid

(

I) is attributable to services personally rendered by the

individual for the production of the eligible film, or

Subparagraph 3(1)(g)(ii)(A)(

I) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(II) is attributable to and does not exceed the salary or wages of

the individual’s eligible employees for personally rendering

services for the production of the eligible film,

Subparagraph 3(1)(g)(ii)(A)(II) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(

B) another corporation, to the extent that the amount paid is

attributable to and does not exceed the salary or wages of the other

corporation’s eligible employees for personally rendering services

for the production of the eligible film,

Paragraph 3(1)(g)(ii)(

B) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(

C) another corporation, all the issued and outstanding shares of the

capital stock of which, except directors’ qualifying shares, belong

to an eligible individual and the activities of which consist

principally of providing the eligible individual’s services, to the

extent that the amount paid is attributable to services rendered

personally by the eligible individual for the production of the

eligible film, or

Paragraph 3(1)(g)(ii)(

B) replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

(

D) a partnership that is carrying on business in Canada, to the extent

that the amount paid

(

I) is attributable to services personally rendered by an eligible

individual who is a member of the partnership for the

production of the eligible film, or

Subparagraph 3(1)(g)(ii)(D)(

I) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(II) is attributable to and does not exceed the salary or wages of

the partnership’s eligible employees for personally rendering

services for the production of the eligible film,

Subparagraph 3(1)(g)(ii)(D)(II) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

and

(iii) if the corporation is a wholly owned subsidiary of another corporation,

and the corporation and its parent have agreed that this subclause applies

in respect of the production of the eligible film, the reimbursement made

by the corporation in the taxation year, or no later than 60 days after the

end of the taxation year, of an expenditure that was incurred by the

parent in a particular taxation year of the parent in respect of the

production and that would be included in the eligible salaries of the

corporation in respect of the eligible film for the particular taxation year

because of subclause (

i) or (ii) if

(

A) the corporation had had that particular taxation year, and

(

B) the expenditure had been incurred by the corporation for the same

purpose as it was by the parent and had been paid at the same time

and to the same person or partnership as it was by the parent;

Subclause 3(1)(g)(iii) replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

Clause 3(1)(

h) repealed: O.I.C. 2011-296, N.S. Reg. 249/2011.

(i) “Minister” means the Minister of Finance for the Province or a person

designated by the Minister of Finance for the Province to perform certain

duties assigned to the Minister of Finance for the Province pursuant to the Act

or the regulations;

Clause 3(1)(

i) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

[Note: Effective October 22, 2013, the reference to the Minister of Finance for the Province should be read

as a reference to the Minister of Finance and Treasury Board for the Province in accordance with Order in

Council 2013-348 under the Public Service Act , R.S.N.S. 1989, c. 376.]

(ia) “principal owner” means the person or group of persons determined by

reference to

Section 6A.

Clause 3(1)(ia) added: O.I.C. 2007-580, N.S. Reg. 422/2007.

Clause 3(1)(

j) repealed: O.I.C. 2011-296, N.S. Reg. 249/2011.

Subsection 3(1) amended: O.I.C. 2000-457, N.S. Reg. 158/2000.

Subsection 3(2) repealed: O.I.C. 2007-580, N.S. Reg. 422/2007.

(3) For the purpose of clause (1)(g),

(

a) remuneration does not include remuneration determined by reference to profits

or revenues;

(

b) salaries or wages do not include an amount determined by reference to profits

or revenues;

(

c) where the value of remuneration, salaries or wages may include an amount

determined by reference to profits or revenues, the Minister may deem a value

for that portion of eligible salaries; and

Clause 3(3)(

c) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(

d) services referred to in subclause (1)(g)(ii) that relate to the post-production

stage of the production include only the services that are rendered at that stage

by a person who performs the duties of animation cameraman, assistant

colourist, assistant mixer, assistant sound-effects technician, boom operator,

colourist, computer graphics designer, cutter, developing technician, director of

post-production, dubbing technician, encoding technician, inspection

technician - clean-up, mixer, optical effects technician, picture editor, printing

technician, projectionist, recording technician, senior editor, sound editor,

sound-effects technician, special effects editor, subtitle technician, timer, video-film recorder operator or videotape operator.

Part I - Film Industry Tax Credit

4 An eligible corporation that has made expenditures in respect of eligible salaries in a

taxation year may apply for a tax credit certificate by delivering to the Minister, no later

than 30 months after the end of that taxation year, in a form acceptable to the Minister, an

application including all of the following:

(

a) statements detailing the eligible salaries for the eligible film;

Clause 4(

a) amended: O.I.C. 2011-296, N.S. Reg. 249/2011.

(

b) proof that the corporation is a legally valid, existing corporation with its

corporate registration status in good standing;

(

c) a list of eligible individuals and employees, including their names, social

insurance numbers, eligible salaries, occupations and residential addresses;

(

d) a copy of the final script of the eligible film, or for complete productions, a

copy of the eligible film;

(

e) a list of dates and geographic locations for the production activity;

(

f) the name of the eligible film’s principal owner and any documentation and

verification requested by the Minister;

(

g) if the corporation is applying for the frequent filmer credit, the name of the

principal owner for each of the 2 prior films, the dates of principal photography

for each of the 2 prior films, copies of the completed production for each of the

2 prior films and any documentation and verification requested by the Minister;

(

h) a statement signed by an authorized officer of the corporation that the

information contained in the application is true and correct;

(

i) any information that the Minister may require in order to determine compliance

with the Act and the regulations.

Section 4 replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

5 For the purposes of subsection 47(2) of the Act, all of the following are prescribed as the

eligibility criteria for a corporation:

(

a) the corporation is incorporated under the laws of Canada or a province of

Canada and is a taxable Canadian corporation primarily carrying on business

that is a film or video production business;

(

b) the corporation has a permanent establishment in Nova Scotia;

(

c) at least 25% of salaries and wages of the corporation are eligible salaries.

Section 5 replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

(1) All of the following are prescribed as the eligibility criteria for a film:

(

a) the film is intended for a television, cinema, videotape or non-theatrical

production and the subject matter of the film is drama, variety, performing arts,

an animated or informational series, a documentary or music programming;

(

b) the film is none of the following:

(

i) a film that has been prohibited for use or exhibition under the Theatres

and Amusements Act ,

(ii) a film produced to solicit funds,

(iii) a film produced primarily for industrial, corporate or institutional

purposes,

(iv) a film, other than a documentary, all or substantially all of which consists

of stock footage;

(

c) the film does not consist of any of the following types of programming:

(

i) news, current events or public affairs,

(ii) weather or market reports,

(iii) talk shows,

(iv) games, questionnaires or contests, other than in a film that is directed

primarily at minors,

(

v) sports events or activities,

(vi) gala presentations or awards shows,

(vii) reality television,

(viii) pornography,

(ix) advertising.

(2) Subject to subsection (4), for the purposes of the additional frequent filmer credit

under subsection 47(2A) of the Act, all of the following are prescribed as the

eligibility criteria for a film:

(

a) the film is an eligible film;

(

b) the film is intended for cinema or television;

(

c) the film is produced by an eligible corporation;

(

d) the film was not previously used by a principal owner as the qualifying film for

the frequent filmer tax credit;

(

e) the film has a minimum viewing time of 20 minutes.

(3) Subject to subsection (4), for the purposes of the additional frequent filmer credit

under subsection 47(2A) of the Act, all of the following are prescribed as the

eligibility criteria for each of the 2 prior films referred to in clause (

b) of that

subsection:

(

a) the film is an eligible film;

(

b) the film is intended for cinema or television;

(

c) the film is produced by an eligible corporation;

(

d) the film is a completed production at the time of the application for the

frequent filmer credit for the film referred to in subsection (2);

(

e) the film has a minimum viewing time of 20 minutes;

(

f) the film was not previously used as a prior film by a different principal owner.

(4) For the purposes of the additional frequent filmer credit under subsection 47(2A) of

the Act, a television series or other cycle of commercially exploitable series is treated

as one film regardless of the number or length of the episodes.

Section 6 replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

6A

(1) Except as provided in subsection (2), an eligible film’s principal owner is the same

person or group of persons who, throughout the period of principal photography of

the eligible film and at the time of application for the tax credit, owns either of the

following:

(

a) at least 50% of the voting shares of the corporation that claims the tax credit;

(

b) the eligible film.

(2) If an eligible film would otherwise have more than one principal owner, it is deemed

to have no principal owner other than the principal owner identified in an agreement

filed with the Minister and signed by each person who

(

a) is or would otherwise be a principal owner, or

(

b) is a member of a group that is or would otherwise be a principal owner.

Section 6A added: O.I.C. 2007-580, N.S. Reg. 422/2007.

7 For the purposes of subsection 47(2) of the Act, the “eligible geographic area” consists of

all geographic areas of the Province except the geographic area that is within a radius of 30

kilometres driving distance from Halifax City Hall in the Halifax Regional Municipality.

Section 7 replaced: O.I.C. 2000-457, N.S. Reg. 158/2000.

Section 8 repealed: O.I.C. 2000-457, N.S. Reg. 158/2000.

9 The Minister may, at any time after a tax credit certificate has been issued, revoke the tax

credit certificate if, in the opinion of the Minister, the corporation has not complied with

any provision of the Act or these regulations, or the spirit and intent of the Act and these

regulations.

Section 9 replaced: O.I.C. 2007-580, N.S. Reg. 422/2007.

Part II - General

(1) An eligible corporation shall maintain records in such form and containing such

information as the Minister considers necessary to determine that the Act and these

regulations are being complied with.

Subsection 10(1) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(2) The eligible corporation shall keep the records at its head office, or at such other

place that is approved by the Minister.

Subsection 10(2) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(1) The Minister may, during normal business hours, make an examination of the affairs

of a corporation for the purpose of determining compliance with the Act and these

regulations.

Subsection 11(1) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(2) The Minister is entitled, for the purpose of determining compliance with the Act and

these regulations, to examine the records and securities of a corporation, and make

copies of those records and securities.

(1) The Minister may, by order, appoint a person to conduct whatever inquiry or

investigation the Minister considers appropriate for the administration of these

regulations and, in the order, shall determine the scope of the investigation.

(2) On the application of the Minister or an investigator appointed pursuant to

subsection (1), and upon being satisfied by information on oath that it is necessary

and in the public interest for any purpose relating to an inquiry or investigation

pursuant to subsection (1), the Supreme Court of Nova Scotia may make an order

authorizing the investigator

(

a) to enter into the premises or onto the land of a person at any reasonable time

for the purpose of carrying out an inspection or examination;

(

b) to require the production of any records, securities or things and to inspect or

examine them; and

(

c) on giving a receipt, to remove any records, securities or things inspected or

examined pursuant to clause (

b) for further inspection or examination.

(3) An application for an order pursuant to subsection (2) shall be made in the

prescribed manner.

(4) An application for an order pursuant to subsection (2) may be

(

a) made ex parte; and

(

b) heard in camera,

unless the Supreme Court of Nova Scotia otherwise directs.

(5) An inspection or examination pursuant to subsection (2) shall be completed as soon

as practicable and the records, securities or things shall be promptly returned to the

person who produced them.

(6) No person shall withhold, destroy, conceal or refuse to give any information or

produce any record, security or thing reasonably required by the investigator

pursuant to this Section.

13 The Minister may extend, with or without conditions, the time limit for doing anything

pursuant to the Act or these regulations and may grant the extension notwithstanding that

the time limit to be extended has expired.

(1) Every person who

(

a) makes or assists in making a statement in any document or information

required to be filed or furnished to the Minister pursuant to

Section 11 or to a

person conducting an inquiry or investigation pursuant to

Section 12 that, at the

time and in the circumstances under which the statement is made, is false or

misleading with respect to a material fact or omits a material fact, the omission

of which makes that statement false or misleading;

(

b) willfully withholds, destroys or conceals a record or security referred to in

subsection 11(2);

(

c) impedes the investigator from entering premises pursuant to clause 12(2)(a);

(

d) authorizes, permits or acquiesces in respect of a share purchase, transfer or

redemption that is contrary to a provision of the Act or these regulations; or

(

e) contravenes

Section 10 or subsection 12(6),

is guilty of an offence and liable on

summary conviction to a fine of not more than

$2000 or to imprisonment for not more than one year, or to both fine and

imprisonment.

(2) Where a corporation is guilty of an offence pursuant to subsection (1),

(

a) the corporation is liable on

summary conviction to a fine of not more than

$20 000; and

(

b) every director or officer of the corporation who authorized, permitted or

acquiesced in the offence is guilty of an offence and is liable on

summary

conviction to the penalties provided for the offence, whether or not the

corporation has been prosecuted or convicted.

Subsection 14(2) amended: O.I.C. 2007-580, N.S. Reg. 422/2007.

(3) A person is not guilty of an offence pursuant to this

Section in relation to a

statement made if the person did not know that the statement was false or

misleading and, in the exercise of reasonable diligence, could not have known that

the statement was false or misleading.