• Yukoners enjoy a very high quality of life.
  • Yukon is home to one of the world’s largest iron ore deposits and one of the world’s largest undeveloped lead-zinc districts.
  • Yukon businesses are leading the way.
  • Partnerships are key to our success.
  • Yukon’s workforce is highly educated, skilled, motivated and productive.
  • Yukon is open for business.
  • Yukon has been a site location for a number of feature films including the 20th Century Fox's, "The Big Year" starring Steve Martin, Owen Wilson and Jack Black.
  • Small and medium-sized enterprises continue to be Yukon’s largest private sector employer.

Competitive Tax Schedule

There are numerous taxes that can affect business owners in Yukon, but there are also a number of tax credits and rebates that business owners can take advantage of financially. These tax programs often encourage businesses to invest in certain activities, but some are applicable to types of businesses, rather than activities like investment. As in any jurisdiction in Canada, businesses are subject to territorial/provincial taxes in addition to federal taxes and business operators are reminded to become fully informed of all taxes affecting a jurisdiction.

Yukon’s tax system is very competitive. Administered at two levels, the first by the Canada Revenue Agency (federal) and the second by the Yukon’s Department of Finance, Yukon’s tax system favours local businesses. Below is a description of the various taxes and tax programs businesses may be subject to while operating in Yukon. Immigrant or non-resident business owners may find an additional form of tax relief or reduction if there exists a bilateral income tax treaty between Canada and their home country.

If a business is incorporated then it is subject to corporate tax rates and programs and must file a corporate income tax form (T2). If a business is not incorporated it must file personal income tax forms (T1) for each relevant partner. More information about T1 and T2 tax forms can be found on the Canada Revenue Agency’s website here.

Small Business Investment Tax Credit – (Personal) 

The Small Business Investment Tax Credit was introduced in 1999 for qualified investments issued by an eligible small business corporation. An eligible small business corporation is a private or co-operative corporation with:

a)       less than $25 million in assets;

b)       a permanent establishment in the territory; and

c)       at least 50 per cent of assets and payroll in Yukon

Corporations that plan on offering qualified investments to investors must apply to the Yukon Department of Economic Development. The certificates for claiming the credit are issued by the Department of Economic Development. The tax credit is equal to 25 per cent of qualified investments. The maximum claim for a taxation year is $25,000. It is claimable by individuals resident in Yukon at the end of the taxation year that are at least 19 years old. Unused amounts may be carried back three years or forward seven years.

Research and Development Tax Credit – (Personal and Corporate)

The Research and Development Tax Credit provides a refundable tax credit for eligible expenditures made on or after January 1, 2001 for individuals and on or after July 1, 2000 for corporations. Individuals must have been a resident in Yukon on the last day of the taxation year for which the credit is being claimed. Corporations must have a permanent establishment in Yukon. The credit is refundable to the extent it exceeds income tax payable. Eligible expenditures are qualifying expenditures for the federal research and development and are incurred in respect of scientific research and experimental development carried on in Yukon. The tax credit must be claimed within 12 months of the tax return filing due date and the credit that may be claimed is equal to the sum of:

a)      15 per cent of total eligible expenditures, plus additional

b)      5 per cent of total eligible Yukon College expenditures

Yukon Manufacturing and Processing Profits Tax Credit - (Corporate)

Corporations engaged in manufacturing and processing may claim an effective corporate rate of 2.5 per cent on manufacturing and processing income as determined on Schedule 27 of the Federal Corporate Tax Return (T2). The rate is effective regardless of whether the corporation qualifies for the small business tax rate. To obtain the 2.5 per cent Yukon rate, T2 Schedule 440 must be completed and the corporation must claim 1.5 per cent credit on income tax at the Yukon small business rate of 4 per cent, and a 12.5 per cent credit against income taxed at the 15 per cent general Yukon rate.

 

First Nations Income Tax Credit – (Personal)

The credit is available only to individuals residing on Yukon First Nations Settlement Lands of the following 10 First Nations: Champagne and Aishihik, Kluane, Little Salmon/Carmacks, Nacho Nyak Dun, Selkirk, Teslin Tlingit, Tr'ondëk Hwëch'in, Vuntut Gwitchin, Ta'an Kwach'än and Kwanlin Dün. As the remaining Yukon First Nations sign their respective Self-Government and Personal Income Tax Sharing Agreements, their residents will be able to claim the credit as well.

 

The credit is in effect since January 1, 1999, and forms a part of new tax sharing agreement with the above Self-Governing Yukon First Nations. The purpose is to offer tax abatement to individuals who are resident on settlement lands, so the total amount of taxes otherwise payable to the federal and Yukon government would be the same. The credit consists of 95 per cent of Yukon territorial tax. To claim the credit an individual must file a personal tax return but in addition to Yukon Tax Credit Forms YT428 and YT479, the Yukon First Nations Tax Form YT432 must be completed and self-governing First Nation clearly identified. 

Summary of Taxes 123

TYPE

Rate

Description

YT Corporate Tax

15%

Businesses ≥$500,000

3%

Businesses ≤$500,00

Federal Corporate Tax

15%

Businesses ≥$500,000

[38% - (10% abatement) – (13% reduction)]

11%

Businesses ≤$500,000

[38% - (10% abatement) – (17% reduction)]

Combined Federal/YT Personal Income Tax

22.04%

Personal income ≤$42,707

31.68%

Personal income ≥$42,707, ≤$85,414

37.44%

Personal income ≥$85,414, ≤$132,406

41.76%

Personal income ≥$132,406

Federal Sales Tax

5%

‘Goods and Services Tax’



1 Types of industries, such as natural resource extraction, may be subject to additional taxes or royalties
2 Property taxes not listed.  Any business owning real property may be subject to property tax.  For more information contact your local municipality.
3 For more information on Yukon income taxes

Privacy StatementSitemapDisclaimer
Yukon Economic Development