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Saskatchewan Dividend Tax Credit

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Saskatchewan-> Dividend tax credit

Saskatchewan Dividend Tax Credits

SK Income Tax Act, 2000 s. 32
Bill 87, an Act to amend The Income Tax Act, 2000

Saskatchewan Enhanced Dividend Tax Credit for Eligible Dividends

Saskatchewan enhanced dividend tax credit credit rates for eligible dividends are defined as a percentage of the Federal gross-up amount.

Saskatchewan Enhanced Dividend Tax Credit

Year 2009 2010 2011 2012+
Gross-up % 45% 44% 41% 38%
enhanced dividend tax credit as a % of
gross-up 35.44% 36.00% 37.83% 39.95%
taxable (grossed-up) dividends 11% 11% 11% 11%
actual dividends 15.95% 15.84% 15.51% 15.18%

As a result of the reduction in the gross-up rate, Saskatchewan announced in their 2009 budget that they were revising the structure of their enhanced dividend tax credit (DTC), to keep the DTC rate at 11% of taxable dividends.  The revisions are reflected in the above table.

Saskatchewan Dividend Tax Credit for Non-eligible Dividends

SK Income Tax Act 2000 s. 32

The Federal 2016 Budget announced that the gross-up rate for non-eligible dividends (also know as regular dividends, or small business dividends) would be not be revised further after 2016, and the Federal tax credit rate for these dividends would remain at 2016 rates.

For non-eligible, or small business dividends, the Saskatchewan 2016 Budget indicated that the tax credit would remain at 3.4% of the taxable dividend.  However, Bill 22, which received Royal Assent on June 30, 2016, revised the rate to 23.173% of the federal gross-up, resulting in a tax credit of 3.367% of the taxable dividend.  SK Finance has confirmed that this will not be rounded to 3.4% on tax forms.

The rates for non-eligible dividends are reflected in the following table.

     SK Dividend Tax Credit Rate for Non-Eligible Dividends

Year Gross-up
Rate
%of Federal
Gross-up
% of Grossed-up
Dividend
% of Actual
Dividend
2016+ 17% 23.173% 3.367% 3.939%
2014/2015 18% 22.29% 3.4% 4.01%
2012-2013 25% 20% 4.0% 5.00%
2011 25% 25% 5.0% 6.25%

The Saskatchewan table of marginal tax rates shows the marginal tax rates for eligible and non-eligible dividends and other income.

 

Revised: September 12, 2016

 

 

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