Guest Blogger: Kevin Chan
The 2012 Federal Budget extended the flow-through share tax credit for another year to flow-through share agreements entered into before April 1, 2013. In order to qualify for the tax credit, the investor and the corporation must enter into a flow-through share agreement and the qualifying exploration expenditures must be renounced to the investor by March 31, 2013.
The flow-through share tax credit provides individuals with a 15% non-refundable tax credit for investors who invest in flow-through shares. Some provinces also provide additional incentives to flow-through share investors. For example, Ontario provides an additional 5% refundable tax credit for eligible individual taxpayers who invest in flow-through shares of mining companies who incur eligible Ontario exploration expenses.
As the flow-through share tax credit is officially a temporary measure, the Federal Government is required to renew this tax credit every year in its Federal Budget.