Venture Capital Tax Credit
The Venture Capital Tax Credit is a non-refundable personal and corporate income tax credit available to eligible investors who invest in qualifying venture capital funds.
The Venture Capital Tax Credit encourages investment in professionally managed venture capital funds which in turn make equity capital investments in eligible small and medium corporations within Atlantic Canada.
Tax credit amount
The credit for individual and corporate eligible investors is equal to 15% of eligible investments made in a qualifying venture capital fund. The maximum annual investment amount is $500,000.
Application for a Certificate of Registration
A venture capital fund needs to apply for a Certificate of Registration to become registered as a qualifying venture capital fund.
Approval to carry out authorized raises of equity capital
Qualifying venture capital funds must apply for approval to carry out authorized raises of equity capital. Signed statements from each qualifying small business the fund will be investing in must be submitted with its application to raise equity capital.
- Authorized Raise of Equity Capital Application Form (PDF)
- Qualifying Small Business Signed Statement (PDF)
Eligible investments from eligible investors can only be accepted during an authorized raise of equity capital.
Application for Tax Credit Certificates
At the end of an authorized raise of equity capital, qualifying venture capital funds must apply for tax credit certificates on behalf of all eligible investors who made eligible investments. A signed statement from each eligible investor and an investor data report is required with each application.
The application for tax credit certificates must be received by the department within 6 months of the expiry date of the qualifying venture capital fund's authorized raise of equity capital.
- Tax Credit Certificate Application Form (PDF)
- Eligible Investor Signed Statement (Individuals) (PDF)
- Eligible Investor Signed Statement (Corporations) (PDF)
- Investor Data Report (XLSX)
Once approved, tax credit certificates are issued directly to the investors and may then be claimed on the individual's personal income tax return or corporation's corporate income tax return for the tax year stated on the certificate.
Before you start
Make sure you review detailed criteria in the Venture Capital Tax Credit Guidelines (PDF).
Annual returns
A qualifying venture capital fund which has completed an authorized raise of equity capital must submit an annual return within 6 months of the qualifying venture capital fund's tax year end for each of the 4 years after the expiry date of an authorized raise of equity capital.