Manitoba Cost-of-Production Tax Credit

Cost-of-Production Tax Credit Overview

You can receive up to 38% on eligible Manitoba spend—the most competitive all-spend tax credit in Canada!

Details: Enhance your Incentives! Increase your tax credit to 38% on eligible Manitoba expenditures including eligible Manitoba labour by qualifying for the Manitoba production company bonus!

• Base rate of 30%, calculated on eligible Manitoba expenditures, including eligible Manitoba labour
• Manitoba Production Company bonus: Increase your tax credit by 8% by co-producing with an eligible Manitoba production company.

And there’s more: With the added value of the Canadian Film or Video Production Services Tax Credit (PSTC), the overall value of the up to 38% on eligible Manitoba expenditures, including eligible Manitoba labour, becomes:

• 47.9% on eligible Manitoba labour, and
• 38% on eligible Manitoba expenditures.

Note: The up to 38% Cost-of-Production Tax Credit is an alternative to the up to 65% Cost-of-Salaries Tax Credit which is also available but is based solely on eligible Manitoba labour expenditures.

What Is the Cost-Of-Production Tax Credit?

The Manitoba Film & Video Production Cost-of-Production Tax Credit was announced in March 2010 and provides production companies with a fully refundable corporate income tax credit based on all eligible Manitoba expenditures including labour and deemed labour, if applicable.

The base credit is 30% and, if partnered with an eligible Manitoba production company, an additional 8% bonus may apply, increasing your tax credit to 38% on eligible Manitoba expenditures, including eligible Manitoba labour.

Who can apply?

Applicants must have a permanent establishment (as defined in the Income Tax Act) in Manitoba, be incorporated in Canada (either federally or provincially) and must be a taxable Canadian corporation primarily carrying on a business that is a film or video production. A minimum 25% of the corporation’s T4 Summary must be paid to eligible Manitoba employees for work performed in Manitoba (excluding documentaries).

What qualifies as an eligible Manitoba production company?

The Manitoba production company must have a permanent establishment (as defined in the Income Tax Act) in Manitoba and be a taxable Canadian corporation incorporated under the laws of Manitoba primarily carrying on a business that is a film or video production.

One or more eligible individuals (i.e. who reside in Manitoba for tax purposes on December 31 of the taxation year of production or of the immediately preceding taxation year) must own shares in the eligible applicant company to which are attached more than 50% of the votes for the election of directors of the corporation. A minimum of 25% of the Manitoba corporation’s T4 Summary must be paid to eligible Manitoba employees in the taxation year or in the immediately preceding taxation year.

To qualify for the additional 8% tax credit the Manitoba production company must own some voting shares of the eligible applicant company during its entire taxation year. If the eligible production extends over multiple taxation years, then the ownership requirement applies to all applicable taxation years of the production. A screen credit requirement for the Manitoba production company also applies.

How is a permanent establishment defined in the Income Tax Act of Manitoba?

The Income Tax Act defines “permanent establishment” with three criteria. A production can satisfy the requirements by having production trailers/office space onsite (“fixed place of business”), having producers onsite (“employee or agent established in a particular place with a general authority to contract on behalf of the corporation”), and having production equipment onsite (“uses substantial machinery or equipment in a particular place in a province”).

Are there content requirements?

There are no Canada or Manitoba content requirements.

What projects are eligible to apply?

Eligible projects include fully financed television movies, documentaries, feature films, dramatic series, variety, multimedia, animation, children’s programming, music programming and informational series, as well as digital and web-based production.

What are the eligible Manitoba expenditures?

Eligible expenditures include Manitoba labour, deemed labour, Manitoba service contract expenditures, and Manitoba expenditures for the rental or acquisition of tangible property that are reasonable in the circumstance and directly attributable to the production. Examples of ineligible expenses include, but are not limited to, per diems, financing expenses, living expenses (notwithstanding hotel accommodations up to $300 per night per unit), airfare and travel outside of Manitoba, and promotional expenses.

What if I need to bring in a crew?

Where a non-resident is hired due to lack of available, willing and/or qualified Manitoba crew, their salary may be deemed an eligible labour expenditure if it is for a below-the-line technical position, at least one Manitoba resident receives training on the production for each nonresident being deemed and is approved by the applicable labour organization(s) or approved authority per the Manitoba legislation.

Is there a cap on deemed salaries?

Yes, there is a cap. This cap is determined based on the amount of eligible Manitoba labour expenditures. Deemed salaries will be capped at 30% of total eligible Manitoba salaries provided that at least two Manitoba residents are trained per non-resident or 10% of total eligible Manitoba salaries provided that at least one Manitoba resident is trained per non-resident.

What about share ownership?

Outside share ownership of the eligible applicant company does not affect the ability to claim the base credit.

What about co-productions?

The Manitoba Cost-of-Production Tax Credit is designed to encourage outside collaboration with non-Manitoba producers.

What about copyright/corporate caps?

No copyright ownership is required and there are no corporate caps regarding the number of applications or the amount of tax credit available.

What if I must film outside of Manitoba?

As this credit is based on eligible Manitoba expenditures, filming outside of the province is allowable within the spirit and intent of the Act, recognizing that certain productions may require shooting outside Manitoba; however, only Manitoba expenditures will be eligible.

What about the federal tax credit?

The Manitoba Cost-of-Production Tax Credit is compatible with the Canadian Film or Video Production Tax Credit (CPTC) and the Film or Video Production Services Tax Credit (PSTC), which are administered through the Canadian Audio-Visual Certification Office (CAVCO) at 1-888-433-2200.

What about the Manitoba Film & Video Production Cost-Of-Salaries Tax Credit?

Production companies have the option to apply for either the up to 38% Cost-of-Production Tax Credit calculated on eligible Manitoba expenditures or the up to 65% Cost-of-Salaries Tax Credit calculated on eligible Manitoba labour only. Once the production is complete and the expenses have been paid, companies will have to choose which tax credit is the most beneficial to the production.

Cost-of-Production Application Documents

Please note that we only accept applications through our online application portal. 

Deeming requests need to be made as soon as possible before the start of principal photography. Deeming requests are made by sending the list of positions to be deemed and the names of the non-Manitoba residents to Manitoba Film & Music.

If you can’t find what you need, we’re here to help!

Example APPLY NOW

Cost-of-Production Documents