This tax measure is designed to consolidate the development of information technologies (IT) throughout Québec. It enables eligible corporations to obtain a refundable tax credit until December 31, 2015.

ELIGIBILITY CRITERIA

Eligible Businesses

Your corporation may be eligible if it has an establishment in Québec where it carries on a business whose activities are part of the IT sector.

In particular, your corporation must show:

• that at least 75% of its activities are activities in the IT sector¹ , at least 50% of which are covered by NAICS codes 541510 et 511210, for the taxation year covered by the eligibility certificate application or for the prior taxation year;
• that at least 75% of its activities covered by NAICS code 541510 consist of services ultimately provided to persons with whom it is at arm's length or of services relating to applications developed by the corporation that are used exclusively outside Québec, or a combination of these services, for the taxation year covered by the application;
• that it maintained, at all times, for a given taxation year, a minimum of six eligible full-time employees. 

1 Activities in the IT sector mean activities covered by codes 334110; 334220; 417310; 443120; 511210; 51821 and 541510 of the North American Industry Classification System (NAICS) .

Eligible Employees

To be eligible, an employee must hold a full-time job and devote at least 75% of his or her time to carrying out, supervising or directly supporting work relating to the execution of an eligible activity by the eligible corporation (except administrative tasks). 

Eligible Operations

• IT consulting services relating to technology, systems development, e-business processes and solutions (for instance, strategic planning, reconfiguration of business processes and technology architecture design).
• Development, integration, maintenance and evolution of information systems (for instance, distribution packages, software and computer programs) and technology infrastructure (for instance, technology architecture upgrading and integration of hardware and software components). However, activities relating to the maintenance and evolution of information systems and technology infrastructure carried out by an eligible corporation are eligible activities only if they are incidental to the development and integration activities carried out by the eligible corporation. 
• Design and development of e-commerce solutions (for instance, portals, search engines and transactional web sites).
• Development of security and identification services (for instance, electronic imaging, artificial intelligence and interface) relating to e-commerce activities (for instance, security over internet networks).

Excluded Operations

• The operation of an e-business solution (for instance, processing of electronic transactions over a transactional web site, and management and operation of information systems, applications and infrastructures arising from e-commerce activities).
• The operation of a customer contact centre (for instance, a customer relations management department arising from e-commerce activities).
• Activities not related to e-business.

Eligible Wages

The eligible wage refers to the employment income generally calculated pursuant to the Québec Taxation Act. It is the wage paid to an eligible employee, up to an annual limit of $66,667.

Special Requirements

To be entitled to the tax credit, your corporation must hold an annual eligibility certificate issued by Investissement Québec. It must also obtain an annual eligibility certificate regarding its employees.  

APPLICATION FOR A LETTER OF INTEREST (optional)

The letter of interest allows the corporation to get an advance opinion on its own eligibility and that of its employees. This letter is not required for filing the annual eligibility applications and obtaining the certificates. To ask for a letter of interest, your corporation must fill out the Application for a Letter of Interest - Company and Employees.

ELIGIBILITY PERIOD AND DURATION

The corporation may claim the tax credit for the eligible wages it pays its eligible employees after March 13, 2008 and before January 1, 2016.

DETAILS OF TAX ASSISTANCE

Nature of Assistance

Refundable tax credit equal to 30% of the eligible salaries paid by the corporation to eligible employees.

Fees

Fees are charged for analysis of all eligibility certificate or letter of interest applications. For more information, contact an Investissement Québec advisor, or see the rates schedule on our Web site.

PROCEDURE

Step 1

Contact an Investissement Québec advisor who will answer your questions and tell you where to get a copy of the application for an eligibility certificate on our Web site.

Step 2

Complete the Annual application for an eligibility certificate regarding the corporation and the Annual application for an eligibility certificate regarding employees for the taxation year covered and send it to Investissement Québec as soon as possible after your corporation's year-end.

Step 3

Once Investissement Québec has completed its analysis, it will send you the annual eligibility certificates regarding your corporation and employees.

You can also take advantage of our Interim Financing of Tax Credits program.

March 2009