Corporate Income Tax
Corporate Income Tax Overview
Changes under the Tax Statutes Amendment Act, 2013 (Bill 23)
- posted July 30, 2013:
- Changes include:
- paralleling of the federal policy on collection of amounts from large corporations,
- proxy rates used in the calculation of the Alberta proxy amount when determining eligible expenditures for the Alberta SR&ED tax credit,
- a corporation being required to claim the same amount of capital gains reserves for Alberta and federally, and
- the addition of a clarification regarding a corporation's tax reduction from the political contributions tax credit.
- For more information, see Special Notice Vol. 5 No. 38, Tax Statutes Amendment Act, 2013.
Information for businesses affected by flooding: waiver of tax penalties and interest - posted June 25, 2013:
- Penalties and interest will be waived where a corporation or business was unable to comply with legislated tax filing or payment requirements due to flooding. This also includes the tourism levy. Businesses must submit their Alberta tax return and make their tax payment as soon as they are able to do so.
- For more information, see Special Notice Vol. 8 No. 3, Waiver of Penalties and/or Interest – Natural Disasters.
Bill 9, the Alberta Corporate Tax Amendment Act, 2012 - posted January 8, 2013:
- Bill 9, the Alberta Corporate Tax Amendment Act, 2012, received Royal Assent on December 10, 2012 and provides for major changes in the Insurance Premiums Tax and the Alberta Scientific Research and Experimental Development (SR&ED) Tax Credit programs. New rules for corporations returning to Alberta have also been legislated along with a number of other changes.
- For more information, see Special Notice Vol. 5, No. 37, Alberta Corporate Tax Amendment Act, 2012.
Net File option for Alberta Corporate Income Tax - effective July 8, 2011
- Effective July 8, 2011, Tax and Revenue Administration (TRA) will offer Alberta corporate income tax filers the option of filing returns in electronic format. See:
Refund Interest Rate Change - effective February 10, 2010
Small Business Threshold increased - posted April 22, 2008
2008, The Right Plan for Today and Tomorrow, tabled
on April 22, 2008, increased the small business threshold
from $430,000 to $460,000, effective April 1, 2008. The threshold
increased to $500,000 on April 1, 2009.
Corporations operating in Alberta are required
to file Alberta corporate tax returns in addition to filing with Canada
Revenue Agency (CRA).
Tax and Revenue Administration (TRA), Alberta Treasury Board and Finance, administers the Alberta Corporate Tax Act, that provides for the calculation of:
- Alberta corporate income tax for corporations with a permanent establishment in Alberta, including Alberta deductions and credits such as the Alberta small business deduction, Alberta foreign investment income tax credit, Alberta political contributions tax credit and scientific research and experimental development (SR&ED) tax credit (see below); and
- Insurance premiums tax (formerly insurance corporations tax) payable by corporations carrying on the business of insurance in Alberta (see below).
Corporate income tax has been levied by the province since the 1940s.
All incorporated businesses with a permanent establishment (e.g.,
office, mine, farm, oil well, etc.) in Alberta at any time in a taxation
year pay income tax on the portion of their taxable income allocated
The Alberta calculation of taxable income parallels the federal calculation, although taxpayers may claim different discretionary deductions such as capital cost allowances for federal and provincial purposes. The allocation of income among provinces is generally standardized across the country.
Canadian-controlled private corporations not in an associated group may claim a small business deduction on active business income (i.e., non-investment income) up to the small business threshold of $500,000. Canadian-controlled private corporations in an associated group share the maximum small business threshold. For more information about the small business deduction, see information circular CT-17, Alberta Small Business Deduction.
The insurance premiums tax (formerly referred to as insurance corporations tax) is payable by insurance companies for business transacted in Alberta during the year. For more information, see Special Notice Vol. 5, No. 37, Alberta Corporate Tax Amendment Act, 2012.
Alberta's scientific research and experimental development tax credit program provides a refundable tax credit to corporations for SR&ED expenditures incurred in Alberta by the corporations.