Updated March 2026 · Verified against Canada Revenue Agency (CRA) guidelines
✓ First-Timer Friendly Tax Credit Offset Est. 1977
Tax Credit Federal Active

Atlantic Investment Tax Credit (AITC)

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%
Atlantic Investment Tax Credit (AITC) provides up to 10% of cost of qualifying new buildings and equipment. Investment tax credit of 10% on the cost of qualifying new buildings, machinery, and equipment used in Atlantic Canada (Newfoundland and Labrador, Nova Scotia, New Brunswick, Prince Edward Island, and the Gaspé Peninsula in Quebec). 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

Investment tax credit of 10% on the cost of qualifying new buildings, machinery, and equipment used in Atlantic Canada (Newfoundland and Labrador, Nova Scotia, New Brunswick, Prince Edward Island, and the Gaspé Peninsula in Quebec). Fully refundable for Canadian-controlled private corporations (CCPCs) and partially refundable for others. One of the longest-running regional investment incentives in Canada.

Eligibility Requirements

  • Businesses investing in new buildings, machinery, or equipment in Atlantic Canada (NL, NS, NB, PE, Gaspé Peninsula)
  • Property must be new (not used)
  • Property must be primarily used in qualifying activities in Atlantic Canada
  • Fully refundable for CCPCs; partially refundable for other taxable corporations
Provinces
Newfoundland & Labrador Nova Scotia New Brunswick Prince Edward Island
Industries
All
Business Stage
Startup Growth Established Expansion

Quick Assessment

Difficulty
Easy
Competition
Low
Est. Hours
3h
First-Timer
Friendly

Funding Details

Amount
10% of cost of qualifying new buildings and equipment
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
~3 hours
Approval
Entitlement
Accessibility
--/5
Competition
--/5
Approval Rate
--%
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What's in this Playbook

Everything you need to win AITC — $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 an entitlement for any business investing in Atlantic Canada — no application needed beyond your tax return. Commonly overlooked by businesses that don't know it exists. Fully refundable for CCPCs and partially refundable for others. Stacks with ACOA contributions and provincial incentives.

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Success Profile

A fish processing company in Newfoundland investing $2M in new refrigeration and processing equipment, claiming $200,000 in refundable AITC.

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Evaluation Criteria

Entitlement-based — no competitive evaluation, no application review, no selection committee. Any taxpayer who acquires qualifying new property for use in eligible activities in Atlantic Canada automatically qualifies. The only review is CRA's standard assessment of the tax return to verify the property meets the statutory definitions.

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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 Acquire Qualifying Property Purchase new buildings, machinery, or equipment for use primarily (50%+) in eligible activities (manufacturing, fishing, farming, forestry, mining, energy) in Atlantic Canada (NL, NS, NB, PE) or the Gaspe Peninsula in Quebec.
2 Document the Investment Retain purchase invoices, installation certificates, proof that the property is located in Atlantic Canada, evidence of eligible sector use, and available-for-use documentation. Ensure expenditure is paid within 180 days of the financial year-end.
3 Complete the ITC Schedule on Your Tax Return For corporations: complete Schedule 31 (T2SCH31) as part of the T2 corporate tax return. For individuals: complete Form T2038 (IND). Calculate 10% of the capital cost of qualifying property, reduced by any government assistance received.
4 File Within the Deadline Claim must be filed within 18 months of the end of the tax year in which the property becomes available for use. This is a hard deadline — late claims are forfeit.
5 Receive Credit or Refund CRA processes the claim during standard tax assessment (4-16 weeks). Credit first reduces tax payable. For CCPCs, any excess is fully refundable. For other corporations, 40% of excess is refundable, remainder carries forward up to 20 years or back 3 years.

Required Documents 4

✓ T2 corporate tax return with Investment Tax Credit schedule (T2038)
✓ Proof of eligible property acquisition (invoices)
✓ Evidence property is located in Atlantic Canada
✓ Available-for-use documentation

Eligible Expenses 8

  • New buildings used primarily (50%+) in eligible activities in Atlantic Canada
  • New machinery and equipment for manufacturing and processing
  • New fishing vessels and fishing equipment
  • New farming equipment and structures
  • New forestry and logging machinery
  • New mining and extraction equipment
  • Prescribed energy generation and conservation property
  • New grain storage facilities

Ineligible Expenses 6

  • Used or second-hand property of any kind
  • Property not primarily (50%+) used in Atlantic Canada or the Gaspe Peninsula
  • Property not primarily (50%+) used in an eligible sector
  • Property acquired from a non-arm's length party
  • Retail or service-sector equipment (unless manufacturing/processing)
  • Residential buildings or personal-use property

Intake Periods

Ongoing — claimed on annual tax returns with no intake windows. Available for any qualifying property acquired during the tax year. File within 18 months of year the property becomes available for use.

Deadline Notes

No deadline — available continuously. Claim on annual T2 corporate tax return with Investment Tax Credit schedule (T2038). Fully refundable for CCPCs.

Open Application Portal →

Ineligible Organizations

  • Businesses not operating in Atlantic Canada or the Gaspe Peninsula
  • Businesses not engaged in eligible sectors (manufacturing, fishing, farming, forestry, mining, energy, grain storage, peat harvesting)
  • Non-taxable entities (charities, Crown corporations) that do not file T2 returns
  • Businesses using property primarily (50%+) outside the Atlantic region
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Funding Stack Strategy

Compatible programs, clawback risk, and combined funding potential

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Compatible Programs

ACOA — Business Development Program (BDP) ACOA — Atlantic Innovation Fund (AIF) Invest Nova Scotia Innovation Rebate NL Innovation and Business Development Fund (IBDF) SR&ED Tax Credits
Combined Funding Potential See your total funding potential

Clawback Risk

Medium Risk
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Stacking amounts, clawback details, government stacking limits, and tax implications
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How AITC Compares

Side-by-side with similar programs

Free
Program Amount Difficulty Payment Deadline
Atlantic Investment Tax Credit (AITC) 10% of cost of Easy Tax Credit Offset Ongoing
NL Innovation and Business Developmen... Up to 50% of eligible costs Moderate Reimbursement Ongoing
Ocean Supercluster Up to $5 million Hard Reimbursement Call-specific — no open...
Atlantic Canada Opportunities Agency ... Varies Moderate Reimbursement Ongoing
Business Development Program (BDP) - ... Varies (Repayable Contribution) Moderate Reimbursement Ongoing

Related Programs

Other programs you might be eligible for

Free
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Strategic Response Fund (formerly Strategic Innovation Fund)

Up to $50 million · Federal
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Black Entrepreneurship Program

Up to $250,000 · Federal
 Grant

Industrial Research Assistance Program (IRAP)

Up to $1M typical (avg ~$94K) · $10M ceiling for major... · Federal

Frequently Asked Questions

Quick answers to the questions founders most often ask about AITC

Free
Can sole proprietors claim AITC?
No — only incorporated businesses (CCPCs or other taxable corporations) can claim AITC. Sole proprietors must file as a corporation to qualify for the refundable credit.
What's the typical credit amount for a $500k investment?
10% of $500k = $50k. CCPCs get this as a refundable credit; other corporations get it as a non-refundable credit against taxes owed.
When do I claim AITC on my tax return?
File it on your annual T2 corporate tax return with Schedule T2038. No separate application — it's claimed directly on your tax return.
Why do applications get rejected?
Common rejections: property not in Atlantic Canada, property is used (not new), or property acquired from a non-arm's length party.
Can I stack AITC with ACOA grants?
Yes — ACOA Business Development Program (BDP) grants cover operating costs while AITC covers capital investments. Both can be claimed on the same project.

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