Saskatchewan Chemical Fertilizer Incentive (SCFI)
The Saskatchewan Chemical Fertilizer Incentive (SCFI) is a non-refundable, non-transferable 15% tax credit on capital expenditures valued at $10 million or more for newly constructed or expanded eligible chemical fertilizer production facilities in Saskatchewan.
Companies apply the benefit against corporate income tax (CIT) owing and are able to claim the benefit over a three- to 10-year period once the new or expanded facility is brought into operation.
Eligible chemical fertilizer production is defined as: All processing of mineral and chemical feedstock to create single or multi-nutrient synthetic fertilizer products. This definition excludes facilities that manufacture potash fertilizer products for which potash is the primary feedstock.
The SCFI is administered by the Saskatchewan Ministry of Trade and Export Development.
The SCFI makes one of the world's best investment environments even more attractive. Upon the commissioning of a new or expanded facility, companies apply the benefit against CIT owing and are able to claim the benefit over a three- to 10 year period. Redemption of the benefits is limited to 20% in year one after the facility enters operation, 30% in year two and 50% in year three. Remaining amounts can be carried forward for up to 10 years. In addition to reducing the tax paid based on 15% of qualifying capital expenditures, eligible applicants will be entitled to:
- Choose the taxation year to begin claiming the tax credit; and
- Claim any other eligible tax incentive or grant Saskatchewan may offer without impacting SCFI eligibility or impairing the ability to claim the SCFI tax credit.
- Qualifying projects include new and existing eligible chemical fertilizer production facilities. To be eligible, the project must have $10 million in new capital expenditures, demonstrate the expenditures were made for the purposes of increasing productive capacity and meet the program's definition of eligible chemical fertilizer production.
- In order to qualify for the incentive, applicants will be required to provide certification from an independently qualified third party confirming that the eligible capital expenditures resulted in an increase in productive capacity. As long as all requirements are met, the Ministry of Trade and Export Development will issue an SCFI Eligibility Certificate. The tax refund can be claimed by submitting the SCFI Eligibility Certificate to the Ministry of Finance, along with the corresponding T2 taxation information.
- Redemption of the benefits is limited to 20% in year one after the facility enters operation, 30% in year two and 50% in year three. Remaining amounts can be carried forward for up to 10 years.
The program is effective as of November 1, 2017, to accommodate projects that have been initiated.
3. How to Apply
- Prepare and submit the SCFI – Application for Conditional Approval. If you have questions about the application process, refer to the SCFI – Program Overview and Application Instructions or contact firstname.lastname@example.org.
- If your application meets the preliminary eligibility requirements, you will receive a letter conditionally approving the investment project.
- Following completion of the investment project, submit the SCFI – Request for Certificate of Eligibility and required attachments.
- If the corporation meets the program requirements, the Ministry of Trade and Export Development will provide you with a SCFI Eligibility Certificate stating the eligible capital expenditures to claim.
- Following the taxation year that the Certificate of Eligibility is issued, the applicant has 10 years to claim the SCFI.
- To initiate the rebate period, file the corporation's T2 CIT with the Canada Revenue Agency (CRA). Once the CIT return has been assessed and a T2 Notice of Assessment from the CRA has been received, complete the SCFI Claim Form and submit it to the Ministry of Finance, including a copy of the:
- SCFI Eligibility Certificate, as issued by the Ministry of Trade and Export Development;
- Current year T2 corporation income tax return; and
- Current year Notice of Assessment or Reassessment.
A rebate application will need to be submitted for each year that the rebate is claimed.
- The Ministry of Finance will verify the rebate application and provide:
- A rebate calculated in accordance with the program legislation; or
- A written notice indicating that the corporation is not entitled to the rebate and the reasons for the determination.
4. Application Documents
5. Further Information
For more information about the program, see SCFI – Program Overview and Application Instructions or contact the Ministry of Trade and Export Development at email@example.com.