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Tax incentives to reduce financial risk and improve profitability
The Government of Ontario offers generous tax incentives for mining exploration, development, operations, R&D and mine reclamation. |
Exploration| Deduction of exploration and development expenses in Ontario |
100 per cent |
| Flow-through tax incentive |
Five per cent tax credit for eligible Ontario exploration expenses to be claimed by individual Ontario taxpayers. |
| Prospectors Financial Assistance |
Maximum financial grant of $6,000 is provided to prospectors in exchange for a one per cent royalty per property. |
Production| Mining tax holiday for new or expanded mines |
Profit exemption for first $10 million of profit earned in the first three years for new mine or major expansion or 10 years for remote mines |
| Deduction of research and development expenses |
100 per cent against corporate income tax and mining tax (if related to mine output) |
| Depreciation of mining assets |
Up to 100 per cent of new mine income versus the 30 per cent regular rate |
| Depreciation of processing assets |
15 per cent annually for Mining Tax purposes |
| Incentive for processing in Ontario |
Annual graduated processing allowances of eight per cent to 20 per cent of capital investment in processing |
| Tax exemption from aggregated mining profits |
$500,000 annually from the Ontario Mining Tax |
| Mining Tax rate on mining profits |
Flat 10 per cent rate on profits on non-remote mines over $500,000. Five per cent rate for remote mines. |
| Corporate income tax rate |
12 per cent effective rate (14 per cent rate less two per cent tax rate reduction on mining income) |
| Reclamation |
Expenditures can be carried back after the cessation of mining activities |
