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Part II .

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Prospectus Tax Credit Regulations

made under

Section 46 of the

Income Tax Act

R.S.N.S. 1989, C. 217

O.I.C. 96-36 (January 23, 1996), N.S. Reg. 14/96

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

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

unless otherwise defined.

3 In

Section 13D [46] of the Act and these regulations

(a) “corporation” means a corporation incorporated pursuant to the laws of the

Province, a province or Canada with total assets, calculated pursuant to

Section

7 of the Equity Tax Credit Regulations, less than 50 million dollars and with at

least 25% of salaries and wages, calculated pursuant to clause (

g) of

Section 2

of the Equity Tax Credit Regulations, paid in Nova Scotia;

(b) “expenditure with respect to audit” means an expenditure paid to a qualified

auditor for performing an audit of the financial statements of the corporation

that is directly attributable to the preparation of a prospectus required by a

province’s securities Act and regulations for a public offering of shares from

treasury or a prescribed exchange for purposes of becoming listed on that

exchange but, for greater certainty, does not include an expenditure with

respect to an audit where the corporation regularly prepares audited financial

statements;

(c) “expenditure with respect to legal expenses” means an expenditure made by a

corporation to a solicitor which is directly attributable to the preparation of a

prospectus required by a province’s securities Act and regulations for a public

offering of shares from treasury or a prescribed exchange for purposes of

becoming listed on that exchange;

(d) “expenditure with respect to printing” means an expenditure made by a

corporation which is directly attributable to the printing of a prospectus

required by a province’s securities Act and regulations for a public offering of

shares from treasury or a prescribed exchange for purposes of becoming listed

on that exchange;

(e) “Minister” means the Minister of Finance or an officer designated by the

Minister to perform any of the duties and exercise any of the powers imposed

or conferred on the Minister by or pursuant to

Section 13D [46] of the Act;

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

the Minister of Finance and Treasury Board in accordance with Order in Council 2013-348 under the Public

Service Act , R.S.N.S. 1989, c. 376.]

(f) “normal reassessment period” has the meaning given that expression by

subsection 152(3.1) of the Federal Act;

(g) “prospectus” means a prospectus as defined in the Securities Act or any

document required by a province’s securities Act and regulations for a public

offering of shares from treasury or a prescribed exchange for purposes of

becoming listed on that exchange;

(h) “prescribed exchange” means an exchange incorporated pursuant to the laws of

the Province, a province or Canada;

(i) “qualified auditor” means a person authorized by

an Act of the Province or a

province to give an audit opinion on financial statements.

4 For the purposes of subsection 13D(2) [46(2)] of the Act, the amount of eligible

expenditures made in the taxation year is the aggregate of all eligible expenditures made

less any government assistance, non-government assistance or any other inducements

received in respect of such expenditures, other than government assistance received

pursuant

Section 13D [46] of the Act.

5 For the purposes of subsection 13D(2) [46(2)] of the Act, a corporation may make

application, at any time after its taxation year end and before the end of the normal

reassessment period, to the Minister for a tax credit certificate by filing with the Minister,

in a form acceptable to the Minister, an application containing at least the following

information:

(

a) a reconciliation of all expenditures for which the corporation is making

application for a credit, in sufficient detail for the Minister to determine the

nature, timing and amount of the expenditure; and

(

b) a copy of the prospectus approved by the Securities Commission or accepted

by the prescribed exchange.

6 For the purposes of subsection 13C[D](3) [46(3)] of the Act, where the Minister is

satisfied that the corporation applying for a tax credit certificate has used, or will use, a

majority of the funds raised through the issue of shares for which application is being

made for investment in active business activities in Nova Scotia, the Minister may issue a

certificate to the corporation.

[Note: The enabling

Section of these regulations and the cross-references made throughout have been

updated to reflect amendments made to the Act pursuant to

Section 61 of the Financial Measures

(2000) Act ,

S.N.S. 2000, c. 4.]