and Revenue Administration
Corporate Tax Act
Special Notice Vol. 5 No. 45
||April 14, 2016
||Alberta Treasury Board and Finance, Tax and
|For more information:
5 No. 45 / April 2016
ALBERTA SMALL BUSINESS TAX RATE REDUCTION
NOTE: This special notice is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this special notice and governing legislation, the legislation takes precedence.
As announced in Budget 2016, the Alberta small business tax rate is being reduced from three to two per cent effective January 1, 2017.
The reduction will be implemented by increasing the specified percentage for the Alberta small business deduction that may be claimed by Canadian-controlled private corporations on their qualifying amount, from nine to 10 per cent. The qualifying amount is the least of the corporation’s active business income, taxable income and the Alberta small business limit, which remains at $500,000 annually, adjusted by certain factors.
Form AT2, Alberta Small Business Deduction, AT1 Schedule 1, will be updated to reflect the Alberta small business tax rate reduction and made available at a later date.
See also: related Frequently Asked Questions.