Updated March 2026 · Verified against Canada Revenue Agency (CRA) guidelines
✓ First-Timer Friendly Tax Credit Offset Est. 2006
Tax Credit Federal Active

Apprenticeship Job Creation Tax Credit (AJCTC)

Canada Revenue Agency (CRA)
Maximum Funding
10% of eligible costs
Ongoing
Visit Official Program →
Difficulty
Easy
Payment
Tax Credit Offset
Trend
Stable
First-Timers
Friendly ✓
Co-Funding
10%
Apprenticeship Job Creation Tax Credit (AJCTC) provides up to 10% of eligible salaries, max $2,000 per apprentice per year. Non-refundable investment tax credit equal to 10% of eligible salaries and wages paid to apprentices in prescribed Red Seal trades during their first two years of apprenticeship. Applications are accepted on an ongoing basis. (As of March 2026, verified against Canada Revenue Agency (CRA) program guidelines)

Eligibility & Details

What this program funds and who can apply

Free

Program Description

Non-refundable investment tax credit equal to 10% of eligible salaries and wages paid to apprentices in prescribed Red Seal trades during their first two years of apprenticeship. Maximum credit of $2,000 per apprentice per year. Available to all employers — corporations, sole proprietors, and partnerships. Carries back 3 years and forward 20 years.

Eligibility Requirements

  • Any employer hiring apprentices in prescribed Red Seal trades
  • Apprentice must be in first 2 years of apprenticeship program
  • Available to corporations, sole proprietors, and partnerships
  • Valid apprenticeship contract must be in place
Provinces
All Provinces
Industries
Construction Trades Manufacturing All
Business Stage
Startup Growth Established Expansion

Quick Assessment

Difficulty
Easy
Competition
Low
Est. Hours
2h
First-Timer
Friendly

Funding Details

Amount
10% of eligible salaries, max $2,000 per apprentice per year
Type
Tax Credit
Level
Federal
Co-Funding
Up to 10% of eligible costs
Deadline
Ongoing

Program Scorecard

Competition, effort, and approval at a glance

Hybrid
Competition
Low
Effort
~2 hours
Approval
Entitlement
Accessibility
--/5
Competition
--/5
Approval Rate
--%
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What's in this Playbook

Everything you need to win AJCTC — $19

Not a marketing summary. The actual checklist, intel, and stack strategy reviewers look for.

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How to Win

Insider tips, common pitfalls, and what successful applicants look like

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Insider Tip

This is one of the most accessible tax credits in Canada — any employer with a Red Seal apprentice in their first 2 years qualifies automatically. Non-refundable but carries back 3 years and forward 20. Stack with provincial apprenticeship incentives (Ontario up to $17K per apprentice, Manitoba Paid Work Experience Tax Credit) for significant combined savings on trades hiring.

Premium See what trips up most applicants for this program — and how to avoid it.

Success Profile

A general contractor in Ontario with 5 first-year carpentry apprentices earning $45,000 each, claiming $2,000 × 5 = $10,000 in federal AJCTC plus provincial incentives.

Premium See what successful applicants for this program actually look like.

Evaluation Criteria

Entitlement-based — there is no competitive evaluation. Any employer meeting the basic requirements (valid apprenticeship contract in a Red Seal trade, apprentice in first 2 years, wages paid) automatically qualifies. The CRA verifies eligibility through the tax return filing process. No application, no jury, no merit assessment — if you qualify, you get the credit.

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Don’t waste 2 hours on a preventable rejection
Common rejection pitfalls, what winners look like, and exactly what reviewers score on
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Application Playbook

Step-by-step process, required documents, and expenses

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Application Steps

1 Verify Apprentice Eligibility Confirm your apprentice is working in a prescribed Red Seal trade and is within the first 24 months of their registered apprenticeship contract with a federal, provincial, or territorial government.
2 Track Eligible Wages Maintain payroll records of salaries and wages paid to each eligible apprentice during the tax year. The credit is 10% of eligible wages, capped at $2,000 per apprentice per year.
3 Complete the Appropriate Tax Form Corporations: complete Parts 19, 20, and 21 of Schedule 31 (T2SCH31) — Investment Tax Credit — Corporations. Sole proprietors and individuals: complete Form T2038(IND) — Investment Tax Credit (Individuals).
4 File Annual Tax Return Include the completed AJCTC schedule with your T2 corporate return or T1 individual return. The credit is claimed on Line 41200 — Investment Tax Credit. File within the standard deadline (6 months after fiscal year-end for corporations, April 30 for individuals).

Required Documents 4

✓ T2 corporate tax return (or T1 for sole proprietors) with Investment Tax Credit schedule
✓ Apprenticeship registration documentation
✓ Proof apprentice is in first 2 years of Red Seal program
✓ Payroll records showing eligible wages paid

Eligible Expenses 4

  • Salaries paid to eligible apprentices in prescribed Red Seal trades
  • Wages paid during the first 24 months of the apprenticeship contract
  • Mandatory employment-related costs associated with apprentice wages (EI, CPP employer contributions)
  • Overtime wages paid to eligible apprentices during the qualifying period

Ineligible Expenses 5

  • Wages paid after the first 24 months of the apprenticeship contract
  • Wages for apprentices in non-Red Seal trades
  • Training costs, tuition fees, or tool purchases
  • Wages paid before May 1, 2006
  • Benefits, bonuses, or non-salary compensation not classified as wages

Intake Periods

No intake periods — available continuously. Claim on your annual tax return for any tax year in which eligible wages were paid. Credit available for wages paid after May 1, 2006.

Deadline Notes

No deadline — available continuously. Claim on your annual tax return (T2 for corporations, T1 for sole proprietors). Non-refundable but carries back 3 years and forward 20.

Open Application Portal →

Ineligible Organizations

  • Employers with no federal tax liability (credit is non-refundable — but can carry forward 20 years)
  • Employers of apprentices in non-Red Seal trades
  • Employers of apprentices beyond their first 24 months of apprenticeship
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Funding Stack Strategy

Compatible programs, clawback risk, and combined funding potential

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Compatible Programs

Ontario Apprenticeship Training Tax Credit (ATTC) Canada-Alberta Job Grant Saskatchewan Apprenticeship Training Allowance Canada Job Grant (Provincial Variants)
Combined Funding Potential See your total funding potential

Clawback Risk

Low Risk
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Stacking amounts, clawback details, government stacking limits, and tax implications
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How AJCTC Compares

Side-by-side with similar programs

Free
Program Amount Difficulty Payment Deadline
Apprenticeship Job Creation Tax Credi... 10% of eligible salaries Easy Tax Credit Offset Ongoing
Strategic Response Fund (formerly Str... Up to $50 million Hard Mixed (Advance + Reimb.) Ongoing — continuous...
CanExport SMEs Up to $50,000 Moderate Mixed (Advance + Reimb.) Next deadline: May 29,...
Ontario Innovation Tax Credit Up to 8% tax credit Moderate Tax Credit Offset Ongoing
Quebec R&D Tax Credit (CRIC — Researc... 20-30% tax credit (CRIC) Hard Tax Credit Offset Ongoing

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Other programs you might be eligible for

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Frequently Asked Questions

Quick answers to the questions founders most often ask about AJCTC

Free
Can sole proprietors claim this credit?
Yes — sole proprietors, corporations, and partnerships all qualify. Claim on your T1 tax return (sole proprietors) or T2 (corporations) annually.
What's the realistic credit amount per apprentice?
Exactly $2,000 per apprentice per year — the maximum is achievable if the apprentice earns at least $20,000 in eligible wages during their first two years.
Why do applications fail?
Common failures: apprentice not in a prescribed Red Seal trade, past their first two years, or no valid apprenticeship contract on file.
Can I stack this with provincial programs?
Yes — Ontario offers up to $17K per apprentice via ATTC, Manitoba has a Paid Work Experience Tax Credit, and Alberta’s Canada-Alberta Job Grant covers training costs.
When do I get the credit?
Claim it on your annual tax return (T1 for sole proprietors, T2 for corporations) — no separate application needed. Credit carries back 3 years and forward 20.

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