If you’re an employer in the British Columbia shipbuilding and ship repair industry who employed apprentices, you might be able to claim a refundable tax credit for the salaries you paid them. Keep in mind, even though this is a refundable tax credit, it needs to first be applied against your total income tax payable.
To qualify for the shipbuilding and ship repair industry tax credit, you must be an employer whose main business is to build, repair, or convert ships. Additionally, the apprentice must be registered with the Industry Training Authority (ITA) and take part in an eligible apprenticeship program.
Tax tip: Even if your apprentices don’t qualify for this tax credit, you might still be able to claim the training tax credit.
There are three elements to the shipbuilding and ship repair industry tax credit and you’ll need to complete the T1014-2 form to calculate these amounts.
- Basic tax credit is based on the salary paid to an apprentice in the tax year that’s within the first 24 months of his or her registration in a Red Seal or non-Red Seal program. The apprentice doesn’t need to complete a set number of hours or technical training.
- Completion tax credit is based on the salary paid to an apprentice in the 12-month period before the apprentice completes the requirements for level 3 or higher of a Red Seal or non-Red Seal program. The completion tax credit is claimed in the year the level is completed.
- Enhanced tax credit for First Nations individuals or persons with disabilities that are entitled to the basic and completion tax credits.
Enter the amounts calculated on the T1014-2 in H&R Block’s tax software to claim your tax credit.
Note: This tax credit can only be claimed for salaries and wages paid to eligible apprentices after September 31, 2012 and before January 1, 2020.
Where do I claim this?
Follow these steps in H&R Block’s tax software to file your 2016 taxes:
Important: Before you begin, make sure that you told us that you lived in BRITISH COLUMBIA on December 31, 2016.
- On the PREPARE tab, click the LET’S TALK ABOUT 2016 icon.
- Select the checkbox labelled I worked for myself then select your province or territory of self-employment from the drop-down menu.
- Click the EMPLOYMENT icon.
- Under the CREDITS AND REBATES heading, select the checkbox labelled British Columbia shipbuilding and ship repair industry tax credit (employers) and click Continue.
- When you arrive at the page for your British Columbia shipbuilding and ship repair industry tax credit, enter your information into the tax software.