Corporation Capital Tax

The Corporation Capital Tax (CCT) is a tax levied on financial corporations with a permanent establishment in British Columbia and net paid up capital in excess of a minimum threshold amount. Net paid up capital for a financial corporation is generally made up of the total capital stock, contributed surplus and retained earnings of the corporation, minus specific deductions.

Effective April 1, 2008, the Corporation Capital Tax Act is amended to phase out the existing corporation capital tax over the next three years by reducing the rates by one-third each year. The rate reductions will be pro-rated for taxation years that straddle April 1. The following table shows the scheduled rate reductions.

Corporation Capital Tax Rates

*Financial institutions with paid up capital under $1 billion or that have a head office in BC

Effective April 1, 2010, financial institutions that have net paid up capital equal to or greater than $1 billion will be subject to a minimum tax of 1% of BC paid up capital. The minimum tax is reduced by the total of British Columbia corporate income tax payable for that year, for the 7 preceding years and for the 3 subsequent years. The minimum tax will be pro-rated for taxation years that straddle April 1, 2010. See Financial Institutions Minimum Tax webpage for details.

For tax years prior to September 1, 2002, the Corporation Capital Tax also applies to general corporations and investment dealers. Please see our Archives for more information.