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FILM AND TELEVISION TAX CREDIT ACT

FILM AND TELEVISION TAX CREDIT ACT

Chapter F‑11.3

Table of Contents

                1       Definitions

                2       Eligible corporations

                3       Application

                4       Authorization letter

                5       Revised authorization letter

                6       Tax credit certificate

                7       Revocation

                8       Reconsideration of Minister’s decision

                9       Refusal of applications, authorization letters and tax credit certificates

              10       Examination of records, documents and things

              11       Investigation

              12       Power of investigators

              13       Appointment of experts

              14       Investigator’s report to the Minister

              15       Extension of time

              16       Offences

              17       Limitation on prosecution

              18       Collection and sharing of information

              19       Regulations


              20       Transitional provision

              21       Consequential amendments

              22       Coming into force

Schedule

Definitions

1   In this Act,

                             (a)    “Alberta principal photography” means the period during which filming on a project takes place in Alberta;

                             (b)    “Alberta Production Grant” means the Alberta Production Grant administered by the Minister of Culture, Multiculturalism and Status of Women;

                             (c)    “authorization letter” means an authorization letter issued by the Minister under section 4;

                             (d)    “completion of production” means delivery to the Minister of the final project in accordance with the regulations;

                             (e)    “designated assistance” means designated assistance as defined in the regulations;

                              (f)    “eligible corporation” means a corporation that meets the eligibility requirements under section 2;

                             (g)    “eligible production costs” means eligible production costs as defined in the regulations;

                             (h)    “Finance Minister” means the Minister responsible for the Alberta Corporate Tax Act;

                              (i)    “Minister” means the Minister determined under section 16 of the Government Organization Act as the Minister responsible for this Act;

                              (j)    “permanent establishment” means a permanent establishment as defined in section 1(2) of the Alberta Corporate Tax Act;

                             (k)    “production plan” means a plan for a project that meets the requirements of the regulations;

                              (l)    “project” means a film or television production, or another type of production prescribed by the regulations;

                            (m)    “Screen-based Production Grant” means the Screen-based Production Grant administered by the Minister of Culture, Multiculturalism and Status of Women;

                             (n)    “tax credit certificate” means a tax credit certificate issued by the Minister under section 6;

                             (o)    “taxation year” means a taxation year as defined in section 249 of the Income Tax Act (Canada);

                             (p)    “total production costs” means total costs for a project, including any portion of the project that occurs outside Alberta.

Eligible corporations

2   To be an eligible corporation, a corporation

                             (a)    must be registered as an extra-provincial corporation, incorporated or continued under the Business Corporations Act,

                             (b)    must not be exempt from tax under the Alberta Corporate Tax Act by virtue of section 35 of that Act, subject to the regulations under this Act,

                             (c)    must not be controlled directly or indirectly in any manner whatever by one or more corporations that are exempt from tax under the Alberta Corporate Tax Act by virtue of section 35 of that Act, subject to the regulations under this Act,

                             (d)    must be engaged primarily in film or television production or another type of production prescribed by the regulations,

                             (e)    must not have received an Alberta Production Grant or a Screen-based Production Grant for the project in respect of which the corporation is applying for an authorization letter, subject to the regulations,

                              (f)    must be in compliance with the applicable legislation governing the registration of corporations, and

                             (g)    must satisfy any additional eligibility criteria set out in the regulations.

Application

3(1)  An eligible corporation may apply to the Minister to be issued an authorization letter to receive a tax credit certificate in respect of a project by providing the following to the Minister:

                             (a)    an application in the form, and containing the information, required by the Minister;

                             (b)    the expected date of completion of production;

                             (c)    a production plan;

                             (d)    any other information or records required by the Minister.

(2)  An application under this section must be made within the application period determined by the Minister, and the Minister may consider an application made during the application period at the times determined by the Minister.

(3)  Subject to the regulations, an eligible corporation shall not apply to the Minister for an authorization letter in respect of a project after Alberta principal photography begins on the project.

(4)  If the information provided to the Minister under subsection (1) changes, in accordance with the regulations, the eligible corporation shall apply for a revised authorization letter by providing updated information to the Minister within 30 days after the change occurs.

Authorization letter

4(1)  Where the Minister is satisfied, based on the information or records provided under section 3(1), that

                             (a)    the eligible corporation will be eligible at completion of production to receive a tax credit certificate in respect of the project,

                             (b)    the total production costs at completion of production will be greater than the amount prescribed by the regulations, and

                             (c)    any other criteria or requirements prescribed by the regulations have been met,

the Minister may issue an authorization letter to the eligible corporation in accordance with this section.

(2)  An authorization letter must include the following information:

                             (a)    the preliminary tax credit amount, as determined in accordance with subsection (3);

                             (b)    in the case of an eligible corporation that has not started Alberta principal photography between the date the application is made and the date the authorization letter is issued, the date by which Alberta principal photography must start, as prescribed by the regulations;

                             (c)    the date by which the eligible corporation must provide to the Minister the information required under section 6(2).

(3)  The preliminary tax credit amount under subsection (2)(a) is the lesser of the following:

                             (a)    the estimated tax credit amount, as determined by the formula set out in the Schedule;

                             (b)    the maximum tax credit amount prescribed by the regulations;

                             (c)    the remaining amount available from the funds allocated under this Act for the fiscal year in which the application is made.

(4)  If the Minister refuses to issue an authorization letter to an eligible corporation, the Minister shall promptly give notice to the corporation of the refusal.

Revised authorization letter

5(1)  Subject to the regulations, the Minister may, on receipt from an eligible corporation of additional information or information under section 3(4) or 6(3), issue a revised authorization letter to the corporation in accordance with the regulations.

(2)  If the Minister refuses to issue a revised authorization letter to an eligible corporation, the Minister shall promptly give notice to the corporation of the refusal.

Tax credit certificate

6(1)  This section applies only in respect of an eligible corporation that has been issued an authorization letter under section 4 or a revised authorization letter under section 5.

(2)  Subject to subsection (3), before the date specified on the authorization letter or the revised authorization letter under section 4(2)(c), an eligible corporation referred to in subsection (1) must, in respect of the project for which the authorization letter or revised authorization letter was issued,

                             (a)    deliver to the Minister, for verification of the final project’s compliance with this Act and the regulations, the final project or evidence of compliance in a form that is satisfactory to the Minister,

                             (b)    confirm to the Minister’s satisfaction that the eligible corporation had a permanent establishment in Alberta

                                     (i)    at any time during the period in which the corporation incurs eligible production costs on the project in respect of which the corporation is applying for an authorization letter, and

                                    (ii)    at any time during the taxation year in which the corporation provides to the Minister the information required under this subsection,

                                 and

                             (c)    provide the following information to the Minister in the form and manner required by the Minister:

                                     (i)    the amount of eligible production costs;

                                    (ii)    the designated assistance amount;

                                   (iii)    the amount of total production costs;

                                  (iv)    any other information prescribed by the regulations.

(3)  If an eligible corporation is unable to provide the information required under subsection (2) by the date specified on the authorization letter or revised authorization letter under section 4(2)(c), the corporation shall promptly apply for a revised authorization letter by providing the following information to the Minister:

                             (a)    a statement that the corporation expects the project to reach completion of production;

                             (b)    the reasons for the corporation’s delay in providing the information;

                             (c)    any other information or records required by the Minister.

(4)  On receipt of the information required by subsection (2), and on being satisfied that the eligible corporation has complied with this Act and the regulations, the Minister shall issue a tax credit certificate to the corporation that shows

                             (a)    the date of receipt by the Minister of the information required under this section, and

                             (b)    the amount of the tax credit that may be claimed by the corporation in the taxation year in which the date of receipt falls.

(5)  The amount of the tax credit to be shown on a tax credit certificate issued to an eligible corporation is the lesser of the following:

                             (a)    the actual tax credit amount, as determined by the formula set out in the Schedule;

                             (b)    the preliminary tax credit amount shown in the authorization letter or the revised authorization letter.

(6)  If the Minister refuses to issue a tax credit certificate under this section, the Minister shall promptly give notice to the eligible corporation of the refusal and provide reasons for the Minister’s decision.

Revocation

7(1)  The Minister may revoke an authorization letter, a revised authorization letter or a tax credit certificate if

                             (a)    any information provided by the eligible corporation to obtain the authorization letter, the revised authorization letter or the tax credit certificate is false or misleading or fails to disclose a material fact, or

                             (b)    the Minister considers that, at the time the authorization letter, the revised authorization letter or the tax credit certificate was issued or at a subsequent time, the eligible corporation was in contravention of this Act, the regulations or a condition that the Minister imposed or made under this Act.

(2)  If the Minister revokes an authorization letter, a revised authorization letter or a tax credit certificate, the Minister shall promptly give notice to the eligible corporation of the revocation and provide reasons for the Minister’s decision.

(3)  If the Minister revokes a tax credit certificate, the Minister shall promptly give notice to the Finance Minister of the revocation.

Reconsideration of Minister’s decision

8(1)  If the Minister

                             (a)    gives notice to an eligible corporation under section 6(6) that the Minister has refused to issue a tax credit certificate, or

                             (b)    revokes an authorization letter, a revised authorization letter or a tax credit certificate under section 7,

the corporation may, within 30 days after being notified of the Minister’s decision, request in writing that the Minister reconsider that decision and shall provide the grounds on which the request for reconsideration is made.

(2)  On receipt of written representations under subsection (1), the Minister shall reconsider the matter and may rescind, vary or confirm the previous decision.

(3)  The Minister shall promptly give notice to the eligible corporation of the Minister’s decision to rescind, vary or confirm the previous decision.

(4)  If under this section the Minister decides to rescind or vary a previous decision to revoke a tax credit certificate, the Minister shall promptly give notice to the Finance Minister of that decision.

Refusal of applications, authorization letters and
tax credit certificates

9   Notwithstanding anything to the contrary in this Act, the Minister may, for any reason, including budgetary restrictions, for any period of time, including an indefinite period of time,

                             (a)    refuse to accept further applications for authorization letters or to issue authorization letters, but continue to issue revised authorization letters and tax credit certificates in respect of authorization letters that have already been issued,

                             (b)    refuse to accept further applications for authorization letters, but continue to

                                     (i)    issue authorization letters in respect of applications that have already been made, and

                                    (ii)    issue tax credit certificates and revised authorization letters in respect of authorization letters that have already been issued,

                                 or

                             (c)    refuse to issue further authorization letters but continue to accept applications for authorization letters and issue revised authorization letters and tax credit certificates in respect of authorization letters that have already been issued.

Examination of records, documents and things

10(1)  For the purposes of determining whether a corporation

                             (a)    is eligible to receive a tax credit certificate, or

                             (b)    is complying with this Act and the regulations,

the Minister may appoint a person to examine the records, documents and things of that corporation.

(2)  At the request of the person appointed under subsection (1), the corporation, or any other person in possession of records, documents or things of the corporation, shall provide the person appointed under subsection (1) with those records, documents and things, including electronic records and documents.

(3)  An officer or employee of the corporation shall

                             (a)    cooperate with and give all reasonable assistance to the person appointed under subsection (1) for the purpose of enabling that person to conduct the examination satisfactorily, and

                             (b)    answer questions pertaining to the records, documents and things and provide other assistance that the person requests.

(4)  Without limiting the generality of subsections (1) and (2), the person conducting an examination under this section

                             (a)    is entitled to unrestricted access, without charge, to all records, documents and things related to the enforcement of this Act, and

                             (b)    may make copies of any records, documents or things to which the person is entitled to unrestricted access.

Investigation

11(1)  In this section, “justice” means a justice of the peace or a judge of the Provincial Court.

(2)  The Minister may by order

                             (a)    appoint a person as an investigator to make whatever investigation the Minister considers appropriate for the administration of this Act, and

                             (b)    determine the scope of the investigation.

(3)  On the application of the Minister or the investigator appointed under subsection (2), and on being satisfied by information on oath that it is necessary and in the public interest for any purpose relating to an investigation under subsection (2), a justice may make an order authorizing the investigator

                             (a)    to enter into the premises or on the land of a person at any reasonable time for the purpose of carrying out an inspection or examination,

                             (b)    to require the production of any records, documents or things and to inspect or examine them, and

                             (c)    on giving a receipt, to remove any records, documents or things inspected or examined under clause (b) for the purpose of further inspecting or examining them and making copies of them.

(4)  Unless the justice otherwise directs, an application for an order under subsection (3) may be

                             (a)    made without notice to any other person, and

                             (b)    heard in private.

(5)  An inspection or examination under subsection (3) must be completed as soon as practicable and the records, documents or things must be promptly returned to the person who produced them.

(6)  A person shall not withhold, destroy, conceal or refuse to give any information or produce any record, document or thing reasonably required under this section by the investigator.

Power of investigators

12(1)  An investigator appointed under section 11 has the same power as is vested in the Court of Queen’s Bench for the trial of civil actions

                             (a)    to summon and enforce the attendance of witnesses,

                             (b)    to compel witnesses to give evidence on oath or otherwise, and

                             (c)    to compel witnesses to produce records, documents and things.

(2)  The failure or refusal of a person summoned as a witness under subsection (1) to attend, to answer questions or to produce records, documents or things that are in that person’s custody or possession makes that person, on application to the Court of Queen’s Bench by the investigator, liable to be committed for contempt by the Court of Queen’s Bench in the same manner as if that person were in breach of an order or judgment of that Court.

(3)  Section 41 of the Alberta Evidence Act does not exempt a bank, as defined in that section, or any officer or employee of a bank from the operation of this section.

Appointment of experts

13(1)  If the Minister appoints an investigator under section 11, the Minister may appoint persons having special technical or other knowledge or skills to assist and be responsible to the investigator.

(2)  A person appointed under subsection (1) shall

                             (a)    examine records, documents and things of the person or corporation whose affairs are being investigated, and

                             (b)    perform other duties,

as required by the investigator.

Investigator’s report to the Minister

14   An investigator shall provide the Minister with

                             (a)    a full and complete report of the investigation, including all transcripts of evidence and material in the investigator’s possession relating to the investigation, and

                             (b)    interim reports as requested by the Minister.

Extension of time

15   The Minister may extend, with or without conditions, the time limit for the doing of anything under this Act or the regulations and may grant the extension even if the time limit to be extended has expired.

Offences

16(1)  A person who does any of the following commits an offence:

                             (a)    makes a statement in any record, evidence or information submitted or given under this Act or the regulations to the Minister, to a person working for or under the Minister or to an investigator that, at the time and in the circumstances under which the statement is made, is false or misleading with respect to a material fact or omits a material fact the omission of which makes the statement false or misleading;

                             (b)    makes a statement in an application, report, return or other record required to be filed or furnished under this Act or the regulations that, at the time and in the circumstances under which the statement is made, is false or misleading with respect to a material fact or omits to state a material fact the omission of which makes the statement false or misleading;

                             (c)    withholds, destroys or conceals a record, document or thing referred to in section 10(2) after it has been requested by a person conducting an examination under that section;

                             (d)    contravenes section 10(3);

                             (e)    impedes an investigator from entering premises under section 11(3)(a);

                              (f)    contravenes section 11(6).

(2)  If a corporation commits an offence under subsection (1), the corporation is liable to a fine of not more than $100 000.

(3)  If a corporation commits an offence under subsection (1), every director or officer of the corporation who authorized, permitted or acquiesced in the offence also commits an offence.

(4)  If an individual commits an offence under subsection (1) or (3), the individual is liable to a fine of not more than $50 000 or to imprisonment for a term of not more than one year, or to both a fine and imprisonment.

(5)  A person does not commit an offence under this section in relation to a statement if the person did not know that the statement was false or misleading and, in the exercise of reasonable diligence, could not have known that the statement was false or misleading.

Limitation on prosecution

17   No prosecution for a contravention of this Act is to be commenced more than 2 years from the date when the facts on which the alleged contravention is based first come to the knowledge of the Minister.

Collection and sharing of information

18(1)  The Minister may collect information, including personal information, directly or indirectly, for the purposes of this Act.

(2)  The Minister may share information collected under this Act with the Finance Minister for the purposes of administering the Alberta Corporate Tax Act.

Regulations

19(1)  The Lieutenant Governor in Council may make regulations

                             (a)    defining any word or expression used but not defined in this Act;

                             (b)    restricting or broadening the definition of any word or expression defined in this Act;

                             (c)    prescribing any matter that is to be prescribed under this Act;

                             (d)    respecting the conditions and requirements to be used to determine completion of production;

                             (e)    respecting eligible production costs;

                              (f)    respecting conditions and requirements that a corporation must meet to be an eligible corporation;

                             (g)    respecting the requirements that a production plan must meet;

                             (h)    excluding types of production from the application of this Act;

                              (i)    respecting the making of applications or reapplications, including the making of reapplications after Alberta principal photography has started;

                              (j)    respecting revised authorization letters, including the issuance and content of revised authorization letters;

                             (k)    respecting the issuance or revocation of tax credit certificates or authorization letters;

                              (l)    respecting the manner and form of giving notices;

                            (m)    respecting the collection, use and disclosure of information, including personal information, for the purpose of this Act;

                             (n)    respecting any matter or thing that the Lieutenant Governor in Council considers necessary or advisable to effectively carry out the intent and purpose of this Act.

(2)  A regulation made under subsection (1) may be made effective with reference to a period occurring before the regulation is made.

Transitional provision

20(1)  Despite section 3(3), an eligible corporation may apply for an authorization letter in respect of a project after Alberta principal photography starts on the project if

                             (a)    the corporation applies during the period beginning on the coming into force of this Act and ending on March 31, 2021, and

                             (b)    Alberta principal photography on the project begins during the period beginning on March 1, 2019 and ending on the day before the coming into force of this Act, regardless of the date of completion of production.

(2)  Despite section 4(1)(a), if an eligible corporation referred to in subsection (1) has reached completion of production on a project on or before the day before the coming into force of this Act, the Minister may issue an authorization letter if the Minister is satisfied that the corporation will be eligible to receive a tax credit certificate in respect of the project at any time.

21   (This section amends the Alberta Corporate Tax Act; the amendment has been incorporated into that Act.)

Coming into force

22   This Act comes into force on Proclamation.

(NOTE:   Proclaimed in force January 28, 2020.)

Schedule  

Formulas for Tax Credit Amounts

Estimated tax credit amount

1   The estimated tax credit amount referred to in section 4(3)(a) of this Act is the amount determined by the formula

X = (A-B) x C

where

                             X      is the estimated tax credit amount;

                             A      is the estimated eligible production costs;

                             B      is the estimated designated assistance amount;

                             C      is the prescribed percentage applicable in the prescribed circumstances.

Actual tax credit amount

2   The actual tax credit amount referred to in section 6(5)(a) of this Act is the amount determined by the formula

X = (A-B) x C

where

                             X      is the actual tax credit amount;

                             A      is the eligible production costs;

                             B      is the designated assistance amount;

                             C      is the prescribed percentage applicable in the prescribed circumstances.