TaxTips.ca - Newfoundland and Labrador Dividend Tax Credit

TaxTips.ca
Canadian Tax and
Financial Information

NL Dividend Tax Credit

TaxTips.ca does not research or endorse any product or service appearing in ads on this site. Before making a major financial decision you should consult a qualified professional.
Copyright © 2010

Looking for US tax information? See www.USTaxTips.net

List your firm for free in the TaxTips.ca Business Directory.

Need an accounting, tax or financial advisor? Look in the TaxTips.ca Business Directory.

Atlantic Provinces -> Newfoundland & Labrador -> NL Dividend Tax Credit

Newfoundland & Labrador dividend tax credit

Eligible dividends

NL Income Tax Act, 2000 s. 20(b)

Starting in 2009, the dividend tax credit for dividends eligible for the enhanced dividend tax credit is 31.42% (previously 21.43%) of the Federal gross-up amount, which at 45% gross-up is

	9.75% of grossed-up dividends
	14.14% of actual dividends

The federal gross-up reductions, starting in 2010, will automatically reduce the amount of the NL enhanced dividend tax credit as follows:

Year	2009	2010	2011	2012
Gross-up %	45%	44%	41%	38%
enhanced dividend tax credit as a % of
grossed-up dividends	9.75%	9.60%	9.14%	8.65%
actual dividends	14.14%	13.82%	12.88%	11.94%

The Federal 2008 Budget reduced the gross-up rate and the dividend tax credit rate for dividends eligible for the enhanced dividend tax credit. See the Enhanced Dividend Tax Credit article for details.

Non-eligible dividends

NL Income Tax Act, 2000 s. 20(a)

Newfoundland & Labrador dividend tax credit rates for non-eligible, or small business dividends (25% gross-up) is 25% of the Federal gross-up amount, which is

	5% of grossed-up dividends
	6.25% of actual dividends

Revised: December 30, 2009

The information on this site is not intended to be a substitute for professional advice. Each person's situation differs, and a professional advisor can assist you in using the information on this web site to your best advantage.
See our Business Directory for tax, accounting and finance-related firms in your area.
Please see our legal disclaimer.