Production services tax credit

The production services tax credit is a refundable corporate income tax credit for accredited production corporations that produce accredited film or video productions in British Columbia (B.C.). The credits are available to both domestic and foreign producers and there is no Canadian content requirement.

On this page

• Components of the production services tax credit program
• Regional and distant location tax credits for animation productions
• Applying for a certificate
• Claiming the credits
• Filing deadlines
• Prior legislative changes
• Legislation

Components of the production services tax credit program

The production services tax credit program consists of four tax credits with the following tax credit rates:

• Production services tax credit (28%)
• Regional production services tax credit (6%)
• Distant location production services tax credit (6%)
• Digital animation, visual effects and post-production (DAVE) services tax credit (16%)

To calculate the amount of tax credit you are eligible for, multiply your qualified B.C. labour expenditure by its applicable tax credit rate.

Regional and distant location production services tax credits for animation productions

Subject to the approval of the legislature, Budget 2025 proposes to restore the regional and distant location tax credits for animation productions where:

• Principal photography begins on or after January 1, 2025
• Production takes place in a physical office in a regional or distant location
• The production corporation incurs accredited B.C. labour expenditures in respect of services provided by B.C.-based individuals working in the physical office for at least 50% of their time spent working on the animation production for the taxation year

Animation productions that began principal photography between June 1, 2024 and December 31, 2024 are not eligible for the regional and distant location tax credits.

For more information on these changes, see the Frequently asked questions page.

Animation productions that began principal photography before June 1, 2024 have different eligibility criteria and different calculations that determine if they are eligible for the regional and distant location tax credits.

Inspectors from the certifying authority may visit the corporation’s offices and inspect or copy records to verify an animation production is eligible for the regional or distant location tax credits. Non-compliance with the requirements may result in the denial or revocation of the production corporation’s accreditation certificate and require repayment of film and television tax credits paid.

Applying for a certificate

Before you can claim the credits, you must obtain an accreditation certificate from Creative BC. This includes:

• Filing a pre-certification form with Creative BC within 120 days of incurring your first accredited B.C. labour expenditure (ABCLE) for a production
  • Make sure to file the pre-certification form within the right time frame to avoid reduced or denied claims

To learn more about this deadline and recent changes and view examples​, visit the production services tax credit frequently asked questions page.

• Applying for an accreditation certificate with Creative BC

We strongly recommend you submit your accreditation certificate application to Creative BC within 12 months of your corporation’s taxation year end.

Creative BC cannot guarantee that an application submitted later than 12 months after your taxation year end will be processed in time for you to file with the Canada Revenue Agency (CRA) before the deadline, which may result in your production services tax credit claim being denied.

Claiming the credits

You can claim the credit(s) by:

1. Completing the British Columbia Production Services Tax Credit (T1197) form
2. Attaching the accreditation certificate you receive from Creative BC
3. Submitting it with your T2 Corporation Income Tax Return

A separate T1197 form and accreditation certificate is required for each production. Enter the total amount of credits from all productions you're claiming on line 672 on Schedule 5, Tax Calculation Supplementary - Corporations.

Filing deadlines

For tax years beginning on or after February 19, 2020:

• You must claim the credit no later than 18 months after the end of your corporation's tax year 

For tax years beginning before February 19, 2020:

• You must claim the credit no later than 36 months after the end of your corporation’s tax year

Note: The CRA must receive the T1197 form and accreditation certificate for each production by the filing deadline for each tax year or your production services tax credit may be denied.  

The credit is fully refundable, but must first be applied against total income tax payable. There are no carry-back or carry-forward provisions.

Prior legislative changes

• Budget 2024 excluded animation productions that started principal photography on or after June 1, 2024 from the regional tax credit and distant location tax credit
• For production companies that first incurred an ABCLE between July 1, 2020 and February 21, 2022, Budget 2023 allows you to claim ABCLE incurred up to 120 days prior to the pre-certification form submission date. You are unable to claim ABCLE incurred more than 120 days prior to filing the pre-certification. This may reduce the production services tax credit available to you
• Budget 2022 extended the deadline to file a pre-certification form from 60 to 120 days effective February 22, 2022. This impacts productions that first incur accredited B.C. labour expenditures (ABCLE) on or after February 22, 2022

Legislation

The following legislation applies to the production services tax credit program:

• Income Tax Act (B.C.) Part 5
• Film and Television Tax Credit Regulation