Investors, landlords and developers could see a refundable tax credit of up to $90,000 if they build, acquire or renovate a commercial or industrial building in southwest, eastern or northern Ontario during the next 21 months. The newly released 2021 Ontario budget announces a temporary doubling of the Regional Opportunities Investment Tax Credit, which came into effect in March 2020, resetting the rebate rate at 20 per cent for up to $450,000 worth of eligible investment.
“At a critical time when many businesses are looking to re‐open or transition their operations, enhancing the Regional Opportunities Investment Tax Credit would provide opportunities for economic growth and job creation,” the budget document maintains.
The tax credit is available for Canadian-controlled private corporations making expenditures within 34 counties or regional districts where employment growth lagged the provincial average during the decade from 2009 to 2019. This covers most of the province outside of Ottawa, the Greater Toronto Area and surrounding regions encompassing Barrie, Hamilton, Niagara, Kitchener-Waterloo and Guelph.
For investors interested in secondary and tertiary markets, the tax credit is available in several prominent mid-sized cities including London, Windsor, Kingston, Peterborough, Greater Sudbury and Thunder Bay. To qualify, a building must be purchased, renovated or completed and ready for occupancy between March 24, 2021 and December 31, 2022. The same undertakings are eligible for a 10 per cent refundable tax credit in the period between March 2020 and March 23, 2021.
The credit applies on capital investment in excess of $50,000 to a maximum of $500,000. The Ontario government has budgeted about $61 million for the program to the end of the 2022-23 tax year.