Tax Credit Changes

For a PSTC episodic production, the tax credit rate in effect when the first eligible episode began principal photography is the tax credit rate applied to all episodes constituting one cycle of the series. The date principal photography started on the first episode produced for the entire cycle of the series will determine the basic tax credit rate applicable for the entire production.

For example: If an episodic production started principal photography on November 1, 2024 and completed on June 30, 2025, the basic tax credit rate for the entire episodic production would be 28%. Any episodes of that cycle that start principal photography on or after January 1, 2025 would not be eligible for the higher rate.

No, the PSTC rate increase is based on the principal photography start date for the production, regardless of where principal photography started or when production work began in B.C.

For example: A production begins principal photography on December 1, 2024 outside of BC and VFX production work begins in B.C. on February 1, 2025. Since principal photography of the production began on December 1, 2024, the VFX production services done in B.C. are not eligible for the higher rate even though the work done in B.C. did not start until after January 1, 2025.

Subject to approval of the legislature, the major production tax credit is a refundable tax credit that is 2% of accredited qualified B.C. labour expenditures for a major production.

A major production is an accredited production that spends at least $200 million on accredited B.C. major production expenditures. If the production is intended for television broadcast as a series, all episodes of the cycle of the series produced in B.C. can be combined to meet the $200 million accredited B.C. major production expenditures threshold. Principal photography of the major production must start on or after January 1, 2025.

Accredited B.C. major production expenditures are amounts paid for services rendered in B.C. and goods purchased or leased, and used in B.C., that are in relation to pre-production, production, and post-production. However, the eligible expenditures do not include amounts related to advertising, marketing, promotion or market research, the distribution of the production, or in any way to another film or video production. Furthermore, they do not include any amounts that are not a cost of producing the production or amounts determined by reference to profits or revenues.

A production corporation is eligible for the major production tax credit if the following requirements are met:

• The production corporation is eligible for, and will claim or has already claimed, the production services tax credit
• If the major production is a television series, at least one episode in the cycle of the series is an accredited production that is eligible for the production services tax credit
• Principal photography for the major production begins after December 31, 2024
• The major production was completed in the taxation year it is claimed
• The production corporation has obtained a major production certificate

The production company will need to apply for a major production certificate with Creative BC once the production is completed. Once a major production certificate has been issued, the major production tax credit can be claimed in the taxation year in which the major production is completed. It cannot be claimed in a taxation year prior to the completion of the production or in any subsequent taxation years.

Subject to approval of the legislature, the regional production services tax credit is available to corporations that produce animation productions that meet the following criteria:

• Principal photography (key animation) of the production begins on or after January 1, 2025
• The production is in a physical office in BC outside of the designated Vancouver area
• The production corporation incurs B.C. labour expenditures in respect of services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year
• You must receive a valid accreditation certificate
• The production must have claimed or be making an application for the basic production services tax credits

You must file a pre-certification for the animation production within 120 days of incurring your first accredited B.C. labour expenditure to avoid reduced or denied claims.

A physical office means a building or part of a building, which is used to produce an animation production, that is not a dwelling unit and that is owned or leased by either the corporation producing the animation production or a taxable Canadian corporation that controls that corporation. The physical office must be owned or leased for twelve consecutive months, or from the principal photography start date of the animation production until the date the animation production is completed, whichever is greater.

Subject to approval of the legislature, the regional production services tax credit is a refundable credit, which will be available to animation productions with accredited qualified BC labour expenditure in relation to services rendered by B.C.-based individuals in a physical office located outside of the designated Vancouver area. The credit is 6% of the accredited qualified B.C. labour expenditure for the production for the taxation year that is attributable to the portion of the corporation’s accredited B.C. labour expenditure that is for services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year.

Subject to legislative approval, the distant location production services tax credit is available to corporations that produce animation productions that meet the following criteria:

• Principal photography of the production begins on or after January 1, 2025
• The production is in physical office in B.C. in a distant location
• The production corporation incurs B.C. labour expenditures in respect of services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year
• You must receive a valid accreditation certificate
• The production must be eligible for the production services and regional production services tax credits, and you need to have claimed or be making an application for the production services and regional production services tax credits

You must file a pre-certification for the animation production within 120 days of incurring your first accredited B.C. labour expenditure to avoid reduced or denied claims.

Subject to approval of the legislature, the distant location production services tax credit is a refundable tax credit, which will be available to animation productions with accredited qualified B.C. labour expenditure in relation to services rendered by B.C.-based individuals in a physical office in a distant location.  The credit is 6% of the accredited qualified B.C. labour expenditure for the animation production for the taxation year that is attributable to the portion of the corporation’s accredited B.C. labour expenditure that is for services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year.

Principal photography for animation productions begins when key animation begins.

The employees of the subcontractor must also spend at least 50% of the time that they spend providing services related to the production in the physical office of the animation production corporation that is claiming the tax credit. This office must be located in a regional or distant location.

An inspector for the certifying authority may enter any place used by a corporation to carry on business or keep records at any reasonable time to review the records and make copies. The certifying authority may require that further information or records be provided.

Non-compliance with the requirements may result in the denial or revocation of the production corporation’s accreditation certificate. If an accreditation certificate is denied or revoked, any film and television tax credits received for the animation production must be repaid.

All episodes comprising one cycle of a series are considered a single production under the FIBC. The date principal photography started on the first episode produced for the entire cycle of the series will determine the basic tax credit rate applicable for the entire production.

For example: If an episodic production started principal photography on November 1, 2024 and completed on June 30, 2025, the basic tax credit rate for the entire episodic production would be 35%. Any episodes of that cycle that start principal photography on or after January 1, 2025 would not be eligible for the higher rate.

No, the FIBC rate increase is based on the principal photography start date for the production, regardless of where principal photography started or when production work began in B.C.

For example: A co-production begins principal photography on December 1, 2024 in Ontario and production work begins in B.C. on February 1, 2025. Since principal photography of the production began on December 1, 2024, the production is not eligible for the higher rate.

Subject to approval of the legislature, the regional tax credit is available to corporations that produce animation productions that meet the following criteria:

• Principal photography of the production began on or after January 1, 2025
• The production is in a physical office in B.C. outside of the designated Vancouver area
• The production corporation incurs B.C. labour expenditures in respect of services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year
• The production must be eligible for the basic tax credit and have received a valid eligibility certificate for the basic and the respective tax credits
• The production must have claimed or be making an application for the basic tax credits

A physical office means a building or part of a building, which is used to produce an animation production, that is not a dwelling unit, and that is owned or leased by either the corporation producing the animation production or a taxable Canadian corporation that controls that corporation. The physical office must be owned or leased for twelve consecutive months, or from the principal photography start date of the animation production until the date the animation production is completed, whichever is longer.

Subject to approval of the legislature, the regional tax credit is a refundable credit, which will be available to animation productions with qualified B.C. labour expenditure in relation to services rendered by B.C.-based individuals in a physical office located outside of the designated Vancouver area.  The credit is 12.5% of the qualified B.C. labour expenditure for the production for the taxation year that is attributable to the portion of the corporation’s B.C. labour expenditure that is for services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year.

Subject to approval of the legislature, the distant location regional tax credit is available to corporations that produce animation productions that meet the following criteria:

• The production is in a physical office in B.C. in a distant location
• The production corporation incurs accredited B.C. labour expenditures in respect of services rendered by B.C.-based individuals who spend at least 50% of their time working on the production in the corporation’s physical office
• Principal photography for the production begins on or after January 1, 2025
• The production must be eligible for the basic and regional tax credits and have received a valid eligibility certificate
• The production must have claimed or be making an application for the basic and the regional tax credits

Subject to legislative approval, the distant location regional tax credit is a refundable credit, which will be available to animation productions with qualified BC labour expenditure in relation to services rendered by B.C.-based individuals in a physical office in a distant location.  The credit is 6% of the qualified BC labour expenditure for the animation production for the taxation year that is attributable to the portion of the corporation’s B.C. labour expenditure that is for services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year.

Principal photography for animation productions begins when key animation begins.

The employees of the subcontractor must also spend at least 50% of the time that they spend providing services related to the production in the physical office of the animation production corporation that is claiming the tax credit. This office must be located in a regional or distant location.

An inspector for the certifying authority may enter any place used by a corporation to carry on business or keep records at any reasonable time to review the records and make copies. The certifying authority may require that further information or records be provided.

Non-compliance with the requirements may result in the denial or revocation of the production corporation’s eligibility certificate. If an eligibility certificate is denied or revoked, any film and television tax credits received for the animation production must be repaid.