The B.C. government released the 2025 Budget on March 4, 2025. The budget did not include any changes to the B.C. corporate or personal income tax rates, which remain as follows:
| Personal Tax Rates (Combined B.C. and Federal at the top bracket for income of $259,830 and over) | |
| Interest and regular income | 53.50% |
| Capital gains | 26.75%1 |
| Eligible dividends | 36.54% |
| Non-eligible dividends | 48.89% |
| Corporate Tax Rates (Combined B.C. and Federal) | ||
| Small business tax rate | General corporate tax rate | Investment income |
| 11%2 | 27% | 50.7% |
This budget increases the Speculation and Vacancy Tax Rates, announces a new Major Production Tax Credit, and provides changes to other film, animation, and digital media tax credits. Some of the highlights are noted below:
Corporate Income Tax:
- Starting January 1, 2025, the basic Film Incentive B.C. Tax Credit will increase from 35% to 40%, and the basic B.C. production services tax credit will increase from 28% to 36%
- Starting January 1, 2025, the budget announces the new Major Production Tax Credit, which is available to B.C. production services tax credit claimants with production costs based in B.C. of greater than $200 million. This credit is equal to 2% of a corporation’s accredited qualified B.C. labor expenditures relating to the major production, and available upon completion of the work.
- For eligible salaries and wages paid in B.C. on or after September 1, 2025, the Interactive Digital Media Tax Credit has increased from 17.5% to 25%. This credit has been made permanent and there is no expiration.
- Animation productions with a physical location in a prescribed regional or distant location will be able to claim the Regional and Distance Location Tax Credits under the Film Incentive B.C. Tax Credit and the B.C. production services tax credit, provided that the labor expenditures claimed are for workers who are physically present and working in those offices at least 50% of the time.
- The Training Tax Credit for Apprentices will be extended to the end of 2028 (from the end of 2025).
Personal Income Tax:
- For investments made after March 3, 2025, the budget increases the annual limit that an individual can claim the Small Business Venture Capital Tax Credit from $120,000 to $300,000. Investors may be able to receive up to a 30% tax credit on qualifying investments.
Provincial Sales Tax:
- The budget eliminates the provincial sales tax exemption for used zero-emissions vehicles, effective May 1, 2025.
Other Tax Changes:
- Starting January 1, 2026, the Speculation and Vacancy Tax rates will increase as follows:
- Canadian citizens and permanent residents who are not untaxed worldwide earners will have their rate increased from 0.5% to 1%
- Foreign owners and untaxed worldwide earners will have their rate increased from 2% to 3%
Furthermore, the budget increases the non-refundable tax credit for residents of B.C. from $2,000 to $4,000.
Full details of the Budget can be viewed here.
For more information on how any of the proposed changes may impact your business or you, contact your Rise Advisor.
Your Business. New Heights.
Rise CPA provides professional accounting, tax and business advice to help you make the right decisions at the right time. Since 1979, we’ve been helping clients create businesses and lifestyles they envision by delivering expert insights and financial guidance. At Rise, we excel at advising business owners and their families in a caring and personal way. Our services cover a wide range of Tax Planning, Auditing, Accounting, Estate Planning, and Business Advisory. Please call (604) 936-4377 or use the online contact form to book an appointment with one of our accounting professionals.
