B.C. Eliminates International Business Activity Program | KPMG | CA

B.C. Eliminates International Business Activity Program

B.C. Eliminates International Business Activity Program

B.C. is terminating a tax incentive for companies with international business activities.


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Effective September 12, 2017, B.C. eliminated the International Business Activity (IBA) Program, which provided eligible participants refunds of the B.C. provincial corporate income tax assessed on their international business activities. The province proposed eliminating this program in its budget update on September 11, 2017 and included this measure in Bill 2. There are a number of transitional measures for affected corporations and employees of corporations included in the bill.

Offered under the IBA program, registered companies with a permanent establishment in B.C. were eligible for a refund of B.C. provincial corporate tax. The regime was intended to attract certain Canadian and foreign companies in the international financial sector to the province. It offered companies a refund of up to 100% of B.C. provincial tax paid on income from an "international financial business". Employees of these companies who relocated to B.C. (referred to as "specialists") and registered under the program also qualified for a refund of all or a portion of their B.C. provincial tax paid.

Transitional measures
B.C. has announced a number of transitional measures for corporations and specialists, including the following:

  • A corporation or specialist may not apply to register for the program after September 11, 2017 
  • Corporations and specialists registered as of September 11, 2017 will continue to be registered until the end of the tax year that includes September 11, 2017
  • Corporations with registered specialists as of September 11, 2017 must still file a report for those specialists for the applicable tax year, which is due the earlier of March 31, 2018 and 30 days after the discontinuance of the international business
  • Registered corporations and specialists may file a final return for a refund (the calculation of which is modified so that income earned after September 11, 2017 will not be eligible for a refund) for the tax year that includes September 11, 2017, which is due within 18 months after the end of the tax year.

For more information, contact your KPMG adviser.

Information is current to October 17, 2017. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500

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