skip to Main Content

Tax credit program for

  • Corporations
  • Located on the Island of Montreal
  • Performing Qualified International Financial Transactions (QIFT) and/or Qualified International Financial Operations (QIFO)
  • Workforce composed of at least 6 eligible employees [1]
  • Regrouping three categories of eligible activities:
    • QIFT – front office activities
    • QIFT – back office activities
    • Qualified International Financial Operations
  • Only the establishment of a new Montreal location or a new development project are eligible (new company, new mandate, new product line, etc.)
  • The tax credit can take the form of a corporate tax credit, calculated on eligible employees’ salaries, or under a personal tax advantage for an eligible foreign specialist employee. [2]

IFC Tax Credit : QIFT – Front office activities

  • Non-refundabl tax credit of 24% of the eligible yearly earned salary with regard to local eligible employees [3]
  • Capped at $CAD 18,000 per employee per year
  • Certificate duration : undetermined
  • Total activities must be on QIFT
  • As a rule of thumb, QIFT must be executed for the account of: a customer not living in Canada or a customer living in Canada, in which case QIFT must be related to financial products with “foreign exposure”.
  • Eligible activities must imply at least one of the following 24 QIFT:
  1. Dealing in securities
  2. Clearing house services
  3. Investment advising and portfolio management
  4. Deposits
  5. Loans
  6. Loans and deposits among IFCs
  7. Acceptance or issuance of letters of credit
  8. Financing by means of a bill of exchange
  9. Foreign exchange operations
  10. Financial packaging (engineering)
  11. Development or design of new financial products
  12. Insurance brokerage
  13. Reinsurance
  1. Fiduciary services
  2. Factoring services
  3. Financial leasing
  4. Organization of a qualified investment fund
  5. Administration of a qualified investment fund
  6. Management of a qualified investment fund
  7. Distribution of the shares of a qualified investment fund
  8. International treasury management
  9. *
  10. Documentary collection
  11. Activities performed under the Quebec Immigrant Investor Program
  12. Discount operations carried out regarding a letter of credit or a commercial instrument

* 22. Represents back office activities

IFC Tax Credit : QIFT – Back office activities

  • Refundable tax credit of 24% of the eligible yearly earned salary with regard to local eligible employees [4]
  • Capped at $CAD 18,000 per employee per year
  • Certificate duration : undetermined
  • Total activities must be on QIFT
  • Eligible activities are back office operations with regard to, among others:
    • QIFT performed by an IFC
    • QIFT performed by a non-Canadian financial corporation for a Canadian or non-Canadian customer base
    • QIFT performed by a Canadian financial corporation for a non-Canadian customer base

Back office operations include, but are not limited to:

  1. Fund accounting
  2. Registration of transactions
  3. Custody services
  4. Insurance or administration of insurance policies
  5. Processing of claims
  6. Entering transactions
  7. Transfer of funds and securities
  8. Reconciliation

IFC Tax Credit: Qualified International Financial Operations (QIFO)

  • Refundable tax credit of 24% of the eligible yearly earned salary with regard to local eligible employees
  • Capped at $CAD 18,000 per employee per year
  • Annual amount of incentive limited to 80% of the total tax credit
  • Certificate duration: 10 years
  • Total activities involve an eligible contract mainly composed of QIFO

Eligible contract: An agreement that an IFC corporation enters into with a foreign financial entity – non-Canadian: bank, credit union, trust company, investment dealer, insurance company, advisor or portfolio manager, broker in damage and personal insurance.

  • 51% or more of the activities included in the eligible contract must relate to OFIA :
  1. Compliance
  2. Due diligence
  3. Know your client
  4. Corporate tax and finance
    1. Financial Disclosure
    2. Risk Management
    3. Data quality and control
  • Up to a maximum of 49% of the activities included in the eligible contract may be related activities – other than QIFO
  1. Promotion or marketing
  2. Human & Material Resources Management
  3. Information Technology, including: development of computer systems, migration & modernization of technological platform, computer support, business process automation, digital security (cybersecurity)

Resources

[1] 75% of the employee’s duties are devoted to performing eligible activities. He works full-time: minimum of 26 hours of work/week for a minimum duration of 40 weeks.
[2] Please communicate with Finance Montréal for more information about the personal tax incentive for foreign specialist
[3] A non-refundable tax credit is used to reduce income taxes. However, if the amount of the non-refundable tax credit receivable is greater than the amount of tax payable, the excess may be carried forward.
[4] A refundable tax credit is used to reduce income taxes. However, if the amount of the refundable tax credit receivable is higher than the amount of tax payable, the excess will be refunded to the corporation.

Contact us

Steve Gauthier

Steve Gauthier

Vice-President, Corporate Development

+1 514 287-1540 Ext: 222

Email

Bruno Séguin

Bruno Seguin

Director, Strategic Accounts

+1 514 287-1540 Ext: 323

Email

Download the report

We invite you to fill the form above to get a copy of our report.

Graphics-(2)
Back To Top
X
X