The Ontario Political Contribution Tax Credit was a non-refundable tax credit a corporation could claim after financial contributions were given to a registered political party, constituency association, or registered candidate in the province of Ontario. This tax credit has been eliminated for corporations since January 1, 2017.
Corporations who made a contribution before January 1, 2017 and have unclaimed credits may claim this tax credit within a 20 year time period.
If you are a corporation with unused credits for the Ontario Political Contribution Tax Credit, the tax experts at T2inc explain your T2 tax return process.
How to claim the Ontario Political Contribution Tax Credit
To claim any outstanding contributions made before January 1, 2017 made to Ontario political parties or candidates as a corporation, use your T2 tax return and include Forms 525 and 5.
Form 525
Form 525 is the Ontario Political Contributions Tax Credit. This form enables you to declare any unused credits that you may. To calculate your contribution balance at the end of the tax year, use part 1 to determine your eligible contribution and then multiply this in part 2 by the basic income tax rate.
As of October 2022, the Ontario basic income tax rate is 11.5%.
Form 5
Use Form 5 - the Tax Calculation Supplementary form for corporations. You will need to fill out Form 525 first to find the amount that you are eligible to claim and then add this amount to line 415.
T2inc is your Ontario corporate tax expert
As a small or medium sized business, tax time is a daunting time. There are several different available deductions you could claim including the Ontario Political Contributions Tax Credit. While it is not an active credit, you can still claim your unused credits until January 1, 2037.
If you would like to claim any unused credits, call on T2inc’s corporate tax accountants in Toronto. Contact us today to get ease of mind with your T2 tax return.
Frédéric Roy-Gobeil
CPA, M. TAX
As President of T2inc.ca and an entrepreneur at heart, I have founded many start-ups such as delve Labs and T2inc.ca. A former tax specialist at Ernst & Young, I am also a member of the Ordre des comptables professionnels agréés CPA and have a master's degree in taxation from the Université de Sherbrooke. With a passion for the world of entrepreneurship and the growth mindset, I have authored numerous articles and videos on the industry and the business world, as well as on accounting, taxation, financial statements and financial independence.
