Canadian Film Incentives: A Quick Guide
- Lindsay Spiller
- Sep 15
- 4 min read
Canadian film incentives are designed to attract film and television productions to Canada. They offer financial benefits to both domestic and international productions. These incentives can come in the form of tax credits, grants, and other subsidies provided by federal, provincial, and territorial governments.
Schedule a FREE consultation with Spiller Law to see how we can help you navigate Canadian Film Incentives and learn more about our Entertainment Services.
Here's an overview of how these incentives generally work:
Federal Incentives
1. Canadian Film or Video Production Tax Credit (CPTC):
• Eligibility: Available to Canadian-controlled production companies.
• Benefit: Provides a refundable tax credit of up to 25% of qualified labor expenditures.
• Requirements: Productions must meet Canadian content requirements, including a certain percentage of Canadian personnel involved in key creative positions.
• Update (2025): CAVCO (Canada Audio-Visual Certification Office) released new guidelines clarifying the definition of “advertising” an ineligible genre. Producers should review the 2025 Public Notice to ensure compliance.
2. Film or Video Production Services Tax Credit (PSTC):
• Eligibility: Available to both Canadian and foreign-controlled production companies.
• Benefit: Provides a refundable tax credit of 16% of qualified Canadian labor expenditures.
• Requirements: There are no Canadian content requirements for this credit.
Provincial and Territorial Incentives
Each province and territory in Canada offers its own set of incentives, which can vary significantly. Here are some examples:
1. Ontario:
• Ontario Film and Television Tax Credit (OFTTC):
• A refundable tax credit of up to 35% on eligible Ontario labor expenditures for Canadian productions.
• Enhanced rate of 40% on the first $240,000 in qualifying labour for first-time producers.
• Regional bonus of +10% for productions shooting outside the Greater Toronto Area.
• Online-only productions are eligible (for those beginning after Nov 1, 2022).
• As of Aug 24, 2023, productions must include an on-screen Ontario credit acknowledging support.
• Ontario Production Services Tax Credit (OPSTC):
A refundable tax credit of 21.5% on all qualifying production expenditures in Ontario for domestic and foreign productions.
• Ontario Computer Animation and Special Effects Tax Credit (OCASE):
A refundable tax credit of 18% on eligible labor expenditures for digital animation and visual effects.
2. British Columbia:
As of January 1, 2025, BC introduced major enhancements:
• Production Services Tax Credit (PSTC):
• The refundable tax credit was increased from 28% to 36% of qualified BC labour expenditures for both Canadian and foreign productions.
• Major Production Bonus: +2% for productions with BC production costs over $200 million, bringing the potential total to 38%.
• Film Incentive BC (FIBC):
• A refundable tax credit for Canadian-controlled production companies, providing up to 35% on eligible British Columbia labor expenditures.
• Additional regional and distant location bonuses available.
• Digital Animation or Visual Effects (DAVE) Tax Credit:
• An additional 16% credit on eligible labor expenditures
• Regional/distant bonuses restored for animation if:
• The company maintains a physical office in the regional location, and
• Labor is performed at least 50% of the time at that office.
3. Quebec:
• Refundable Tax Credit for Quebec Film and Television Productions:
Provides up to 40% on labor expenditures for Quebec productions.
• Refundable Tax Credit for Film Production Services (QPSTC):
• Base rate: 25% of all-spend production costs (labor + qualified property).
• Bonus: Additional 16% on labour expenditures for VFX and computer animation (including chroma key).
• Cap: The 16% CASE bonus is now limited to 65% of eligible labour costs, a change that has caused concern in Québec’s VFX/animation sector.
4. Other Provinces (Highlights):
• Alberta: Film & Television Tax Credit of 22% or 30%, depending on level of Alberta ownership.
• Manitoba: Refundable labour-based credit of 45%, with additional regional and frequent-filming bonuses.
• Nova Scotia: Base rate of 25% on eligible Nova Scotia labour, with additional rural bonuses.
Application Process
1. Pre-Production:
• Eligibility Check: Production companies must ensure they meet the specific requirements for each incentive.
• Application Submission: Companies typically submit detailed applications outlining the project, budget, and intended use of funds.
2. During Production:
• Compliance: Productions must maintain records of expenses and ensure they meet ongoing requirements, such as employing local labor.
3. Post-Production:
• Final Submission: After completion, companies submit final reports and financial statements to claim the incentives.
• Review and Approval: Government agencies review submissions and, if approved, disburse the funds.
Benefits of Canadian Film Incentives
· Financial Savings: Tax credits can reduce production costs by 25–60% depending on jurisdiction and structure.
· Skilled Workforce: Canada boasts world-class crews, soundstages, and post-production talent.
· Diverse Locations: From urban centres to natural landscapes, Canada offers locations that double for virtually anywhere in the world.
Considerations
· Compliance: Strict adherence to the rules and regulations governing each incentive program is necessary.
· Documentation: Meticulous record-keeping and reporting are required to ensure eligibility and receive benefits.
· Changes in Policy: As Québec’s 2025 CASE cap shows, incentives are subject to political and fiscal change. Staying current is crucial.
Canadian film incentives remain among the most generous in the world, making Canada a global hub for film and television production. With recent rate increases in BC, new caps in Québec, and enhanced opportunities in Ontario, producers should carefully assess both federal and provincial options when budgeting and choosing a location.
(This blog was originally published on June 29, 2024.)
Spiller Law is an advisor to startup businesses, entertainment and media companies, and artists. Feel free to schedule a free consultation.
Spiller Law is a San Francisco business, entertainment, and estate planning law firm. We serve clients in the San Francisco Bay Area, Silicon Valley, Los Angeles, and California. Feel free to arrange a free consultation using the Schedule Appointment link on our website. For other questions, call our offices at 415-991-7298.
The information provided in this article is for general informational purposes only and should not be construed as legal advice or opinion. Readers are advised to consult with their legal counsel for specific advice.
Comments