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Manitoba Dividend Tax Credit

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Manitoba -> Dividend tax credit

Manitoba Dividend Tax Credit

Manitoba Tax Credit Rates for Eligible Dividends

Manitoba Income Tax Act s. 4.7(1)(b)(ii)

The dividend tax credit for dividends eligible for the enhanced dividend tax credit is 8% of the taxable dividend as of the 2012 tax year, as announced in the Manitoba 2012 Budget.  Prior to 2012, it was 11% of the taxable dividend amount.

The federal gross-up reductions, starting in 2010, automatically reduced the amount of the MB enhanced dividend tax credit as a percentage of the actual dividends, as follows:

MB Dividend Tax Credit Rate for Eligible Dividends
Year 2009 2010 2011 2012+
Gross-up % 45% 44% 41% 38%
enhanced dividend tax credit as a % of
taxable dividend 11% 11% 11% 8%
gross-up amount 35.44% 36.00% 37.83% 29.05%
actual dividends 15.95% 15.84% 15.51% 11.04%

For marginal tax rates and thresholds for the current and prior years, federally and for each province and territory, see the Manitoba Table of Marginal Tax Rates.  See also the Enhanced Dividend Tax Credit article.

Manitoba Tax Credit Rates for Non-Eligible Dividends

Manitoba Income Tax Act s. 4.7(1)(b)(i)

For non-eligible, or small business dividends, the Manitoba dividend tax credit is defined as a percentage of the taxable dividend.

The Manitoba dividend tax credit rates correspond to the reduction in the Manitoba small business corporate tax rate to 4.5% for 2006, 3% for 2007, 2% for 2008, 1% for 2009 and 2010, and zero starting December 1, 2010.

The Federal 2017 Fall Economic Statement announced that the gross-up rate for non-eligible dividends (also know as regular dividends, or small business dividends) would be reduced to 16% for 2018, and to 15% for 2019 and later years.

The current and past Manitoba rates for non-eligible dividends are shown in the following table.  The 2018 and later rates will be in effect unless legislative changes are made by Manitoba.

     MB Dividend Tax Credit Rate for Non-Eligible Dividends

Year Gross-up
Rate
%of Federal
Gross-up
% of Grossed-up
Dividend
% of Actual
Dividend
2019+ 15% 6.01% 0.7835% 0.901%
2018 16% 5.68% 0.7835% 0.909%
2017 17% 5.39% 0.7835% 0.92%
2016 17% 5.71% 0.7835% 0.92%
2014/2015 18% 5.44% 0.83% 0.98%
2011-2013 25% 8.75% 1.75% 2.19%
2009/2010 25% 12.50% 2.50% 3.13%
2008 25% 15.75% 3.15% 3.94%
2007 25% 18.35% 3.67% 4.59%
2006 25% 24.35% 4.87% 6.09%

Revised: October 24, 2017

 

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