TAX CREDIT PROGRAMS FOR IFCs

Transcription

1 ORIGINAL TEXT IN FRENCH TAX CREDIT PROGRAMS FOR IFCs Application for International Financial Centre Qualification Certificate General information and application form

2 General information ELIGIBILITY CONDITIONS Pursuant to provisions in the legislation governing international financial centres, an IFC refers to a business or part of a business that satisfies the following conditions: it is operated by a corporation; 1 it employs, at all times, a minimum of six eligible full-time employees; 2 To apply this criterion, the expression eligible employees includes local employees and foreign specialist employees who hold a qualification certificate issued by the Minister of Finance. all of its activities focus on qualified international financial transactions (QIFTs); the activities enabling the QIFTs effected in the course of its operations to be carried out must be managed entirely within the territory of the urban agglomeration of Montréal; its activities are grouped together in one place within the territory of the urban agglomeration of Montréal; it holds an annual certificate for itself and its eligible employees issued by the Minister of Finance. TAX BENEFITS ASSOCIATED WITH IFC STATUS To be entitled to the tax benefits, a corporation that intends to operate an IFC must first obtain a qualification certificate from the Minister of Finance for the IFC it intends to operate, on the one hand, and for its eligible employees, on the other. The tax assistance offered may be in one, or a combination, of the following forms, as applicable: A corporation that carries on back office activities on behalf of a third party (QIFT 7.22) and that holds an IFC certificate and a valid annual certificate can claim, for a taxation year, a refundable tax credit (RTC) representing 24 of qualified wages incurred for the year in respect of its eligible local employees assigned to those activities, to a maximum annual amount of $ per employee. A corporation that carries on activities other than back office activities on behalf of a third party (24 other categories of QIFTs) and that holds an IFC certificate and a valid annual certificate can claim, for a taxation year, a non-refundable tax credit (NRTC) representing 24 of qualified wages incurred for the year in respect of its eligible local employees assigned to those activities, to a maximum annual amount of $ per employee. A foreign specialist employee who works at an IFC can claim, for a continuous period of five years, a deduction in calculating all of his taxable income at an annual rate that varies as follows: 100 the first two years and 75, 50, and 37.5 respectively for subsequent three years. To obtain additional information, please consult the document General Information Applications for a Foreign Specialist available on the Ministère des Finances website. 1 General partnerships are ineligible for the program. 2 The expression full-time means a minimum of 26 hours of work per week, for a stipulated minimum of 40 weeks. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 2 of 12

3 General information PROCEDURE FOR OBTAINING AN IFC QUALIFICATION CERTIFICATE A corporation that plans to operate an IFC must first obtain a qualification certificate from the Minister. To this end, it must complete this form and append to it the documents indicated in section 13. FEES Application for qualification certificate The application for qualification certificate must be accompanied by a cheque payable to the Minister of Finance for the fees required to analyze the file. To determine the applicable fees, please consult the fee schedule on the Ministère des Finances website. The analysis of the file usually includes a meeting between a representative of the Ministère des Finances and the person responsible for the application. Annual contribution A corporation that holds an IFC qualification certificate must also pay an annual contribution to the Fonds du centre financier de Montréal, which is allocated to fund activities to promote and develop Montréal as an international financial centre. The fee is $ for the first contribution and $3 000 for subsequent contributions. It is payable to the Minister of Finance when the corporation files the application for an annual eligibility certificate. Note: The masculine form of pronouns used in this document refers without discrimination to women and men. WARNING The information in this publication is presented solely for information purposes. The Act respecting international financial centres (CQLR, chapter C-8.3) and the Act respecting the sectoral parameters of certain fiscal measures (CQLR, chapter P-5.1) present details of the measures Contact information To obtain additional information, please contact: Ministère des Finances du Québec Gestion des mesures fiscales 380, rue Saint-Antoine Ouest, bureau 6100 Montréal (Québec) H2Y 3X7 Tel.: Fax: dpif@finances.gouv.qc.ca Website: Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 3 of 12

4 ORIGINAL TEXT IN FRENCH Tax Credit Programs for IFCs Application for International Financial Centre (IFC) Qualification Certificate Notice The Ministère des Finances (MFQ) collects the information that you provide on this form and uses it to verify the eligibility of your activities for the tax credit programs for IFCs. Accordingly, the requested information must be provided and failure to do so may cause your application to be denied. The information is treated confidentially and may only be sent to third parties with the consent of the person who provided it, as stipulated in the Act respecting Access to documents held by public bodies and the Protection of personal information (CQLR, chapter A-2.1). Only authorized staff of the MFQ has access to the information provided. However, certain information may be disclosed to Revenu Québec without the consent of the person who provided it, if necessary for the enforcement of tax legislation. In addition, certain information may be disclosed to the Autorité des marchés financiers (AMF) without the consent of the person who provided it, if necessary for the enforcement of the statutes administered by the AMF. The information provided may also be used by the MFQ for research, assessment, study, investigation, statistical or cost forecasting purposes, or in the course of a survey. The applicant corporation must notify the MFQ in writing as soon as possible of any significant change in the information provided. Notification must be sent to: Ministère des Finances du Québec, Gestion des mesures fiscales, 380, rue Saint-Antoine Ouest, bureau 6100, Montréal (Québec) H2Y 3X7. 1. Program(s) Refundable tax credit (RTC) Non-refundable tax credit (NRTC) 2. General information on the applicant Name of the corporation that intends to operate the IFC (corporate name) Address of the corporation that intends to operate the IFC City Province Country Postal code Website Identification number assigned by Revenu Québec to the corporation that intends to operate the IFC Québec enterprise number (NEQ) of the corporation that intends to operate the IFC Name of the business or part of the business applying for IFC status ( Same name as the corporation. If different, enter the name below.) Address of the site where the IFC will be located ( Same address as the corporation. If different, enter the address below.) City Province Postal code Website Québec Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 4 of 12

5 3. Head of the IFC 3 Mr. First name Last name Ms. Title Telephone Fax Ext.: 4. Person responsible for this application (if different from the head of the IFC) Mr. First name Last name Ms. Title Telephone Fax Ext.: 5. Date of the fiscal period-end of the corporation that intends to operate the IFC mm/dd month/day 6. Registration with a regulatory body (to be completed only by investment dealers and advisers) 4 Is the corporation registered with regulatory bodies such as the AMF, the OSC or the SEC? Yes No If so, with which ones and what kind of registration? If not, is the corporation exempted from registering with these bodies? Yes No 3 A resolution of the board of directors of the corporation designating the head of the IFC must be enclosed with this application for certification. 4 Please enclose with your application a proof of registration or a proof of exemption from registration with the relevant regulatory bodies. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 5 of 12

6 7. Body of shareholders Please indicate the names of the specified shareholders 5 of the corporation that intends to operate the IFC Name of the specified shareholder Percentage of shares held Please enter the names of the shareholders having direct or indirect control of the corporation that intends to operate the IFC Name of the shareholder Country of origin 8. Change in employment As at last December 31 As at December 31 of the first year As at December 31 of the second year As at December 31 of the third year A) Estimate of the number of jobs in Québec in the corporation that intends to operate the IFC B) Estimate of the anticipated number of jobs in the IFC 6 C) Estimate of the number of eligible employees within the IFC for whom the latter plans to apply for certification 7 5 Generally speaking, a specified shareholder of a corporation, within the meaning of the Taxation Act, is, in particular, a shareholder holding at least 10 of a class of shares issued by the corporation. 6 This refers to the total number of employees all or part of whose duties are devoted to the operations of the IFC located at the address mentioned in section 1. 7 This refers to the total number of eligible local or foreign specialist employees at least 75 of whose duties with the IFC located at the address mentioned in section 1 will be devoted to executing QIFTs or to the operations of the IFC. The duties of an employee are devoted to the execution of QIFTs when they are directly attributable to the specific transactional process of a given QIFT. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 6 of 12

7 9. Information on eligible employees Type of position Estimate of the number of jobs Year 1 Year 2 Year 3 Average annual salary or salary range* Minimum training required** * Salary range: ** Training required $ $ to $ $ to $ $ to $ $ to $ $ to $ $ to $ $ to $ > $ DES or DEP: Secondary school diploma or secondary school vocational diploma DCS: Diploma of Collegial Studies Undergraduate degree: Bachelor s degree and certificate Graduate degree: Master s degree and graduate diploma Postgraduate degree: Doctorate Attach another sheet or sheets as necessary; indicate the number and name of the corresponding section. 10. Eligibility of international financial transactions The analysis of the information provided in this section will enable MFQ officials to rule on the eligibility of the international financial transactions that the corporation intends to carry out. You will be asked to identify the categories of international financial transactions that the IFC intends to carry out, to specify the context in which they will be carried out and to represent by a schema and describe the transactional process by which they will be carried out. To this end, you must rigorously follow the four-step process indicated below: Step 1: Step 2: Step 3: Step 4: From the list of 25 categories of qualified international financial transactions (QIFTs) stipulated in section 7 of the Act respecting international financial centres, indicate those that the IFC intends to carry out. For each QIFT category selected in step 1, download and complete the most recent version of the corresponding summary sheet found in the document Appendix 1 that accompanies the application form for qualification certificate on the MFQ website. Attach a diagram and a detailed description of the transactional process specific to each category or sub-category of activity that the IFC intends to carry out to each summary sheet completed in step 2. Confirm that all of the conditions stipulated by the legislation governing the refundable tax credit program for IFCs will be satisfied. Instructions for each of the steps follow. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 7 of 12

8 STEP 1: Referring to the list below, indicate each category of QIFT that the IFC intends to carry out QIFT eligible for the refundable tax credit 7.22 Back office activities for a third party QIFTs eligible for the non-refundable tax credit 7.01 Transaction on outstanding securities or securities distribution 7.13 Reinsurance of a risk arising from a damage insurance contract 7.02 Operating of a clearing house 7.14 Trust services 7.03 Securities advising or portfolio management 7.15 Factoring services 7.04 Deposit of money 7.16 Leasing services 7.05 Lending of money 7.17 Organization of a qualified investment fund 7.06 Lending of borrowing of money between corporations operating an IFC 7.18 Administration of units of a qualified investment fund 7.07 Acceptance or issuance of a letter of credit Management of a qualified investment fund 7.08 Financing or refinancing by means of a bill of exchange 7.20 Distribution of units of a qualified investment fund 7.09 Execution of foreign exchange transactions 7.21 Cash management 7.10 Financial packaging services 7.23 Documentary collection Financial engineering services 7.24 Activities performed under the Québec Immigrant Investor Program 7.12 Damage insurance brokerage services 7.25 Discount operation carried out regarding a letter of credit or a commercial instrument 8 For discount transactions carried out consecutively or incidentally to the acceptance or issuance of a letter of credit, please complete summary sheet QIFT For discount transactions carried out consecutively of incidentally to a documentary collection transaction, please complete summary sheet QIFT Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 8 of 12

9 STEP 2: Summary sheets (qualification certificate) For each category of QIFT selected in step 1 that the IFC intends to carry out and in respect of which the application for certification is being made, please complete and enclose the corresponding summary sheet. The summary sheets (qualification certificate) are available on the MFQ website. STEP 3: Diagram and description of the transactional process To each of the summary sheets that you completed in step 2, please attach a diagram accompanied by a detailed description of the transactional process specific to each category or sub-category of QIFT that the IFC intends to carry out. Clearly describe every step that the transactions should normally follow. The diagram and description of the transactional process must cover, when applicable to your activities, all of the steps listed below. You must provide a detailed description of the steps and specify by whom 10 and where they will be carried out. The description must cover, among other things, the following points: initiation and negotiation relating to the category of QIFT to be carried out; carrying out of the QIFT; description of the method of remuneration specific to each category or sub-category of QIFT that the IFC intends to carry out; back office services relating to the category of QIFT to be carried out, in particular: the registration of QIFTs; settlement, clearing and delivery stemming from QIFTs; record-keeping, accounting and the production of the requisite statements or reports; compliance; customer services; follow-up, control and responsibility in relation to the risks incurred; the selection and updating of the computer tool through which the QIFT will be carried out. 10 If you anticipate that certain activities will be carried out by third parties or outside the IFC, you must provide the necessary details. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 9 of 12

10 STEP 3 (continued): Non-arm s length relationship Does the IFC operator intend to carry out QIFTs on behalf of a related person? 11 No Yes Please identify this person and indicate the nature of the transactions that the IFC operator has carried out on its behalf. Attach another sheet or sheets as necessary; indicate the number and name of the corresponding section. STEP 4: Declaration of compliance The business that constitutes the IFC will satisfy the following eligibility conditions stipulated in the legislation governing IFCs: It will be operated by a corporation. Yes No It will employ, at all times, a minimum of six eligible full-time employees. Yes No Its activities will focus on QIFTs. Yes No The activities enabling the QIFTs effected in the course of its operations to be carried out will be managed entirely within the territory of the urban agglomeration of Montréal. Its activities will be grouped together in one place 12 within the territory of the urban agglomeration of Montréal. Yes Yes No No If you anticipate that one or more conditions will not be satisfied, in whole or in part, please indicate the reason: Attach another sheet or sheets as necessary; indicate the number and name of the corresponding section. 11 For example, a QIFT carried out by an IFC on behalf of its parent company, a subsidiary or a sister company constitutes a transaction between related persons. The same applies where a corporation provides services to an individual with whom it is not dealing at arm s length. 12 The expression in one place generally means at the same civic address. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 10 of 12

11 11. Documents required to process the application The head of the IFC or the person responsible for the application must enclose with the application all of the requisite documents and complete and sign the check list on the following page (section 13). To avoid a delay in processing your application, please ensure that the check list is completed and signed. 12. Signature of the person responsible for the application for certification I, the undersigned, hereby certify that all of the information provided in support of this application for certification of the IFC is true and complete. Upon request, I will provide the Ministère des Finances, Revenu Québec or their representatives with any information concerning this application for certification or any question pertaining to the constitution of the IFC and its operation. I also understand that, under the provisions of the legislation governing IFCs, the Minister may retroactively revoke any qualification certificate or annual certificate issued in respect of an IFC where information or documents brought to the Minister s attention so warrant. Lastly, I undertake to advise the Ministère des Finances, in writing as soon as possible, of any change that may arise regarding the information provided. 13 yyyy/mm/dd Signature of the person responsible for the application Date Name (print) Title 13 The head of the IFC is obliged to inform the MFQ of any significant change in the affairs of the IFC, such as a change of address or share ownership, a restructuring, the addition or loss of activities or staff, the way in which the QIFTs are carried out, and so on. Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 11 of 12

12 13. Check list: Documents that must be sent to the MFQ Mail the documents to the address below: Ministère des Finances du Québec Gestion des mesures fiscales 380, rue Saint-Antoine Ouest, bureau 6100 Montréal (Québec) H2Y 3X7 Space reserved for the MFQ Please check the box beside the documents being mailed: Application form duly completed and signed Summary sheet completed for each category of QIFT that the IFC intends to carry out (see steps 1 and 2) Diagram and detailed description of the transactional process for each of the summary sheets submitted (see step 3) The incorporation papers of the corporation that intends to operate the IFC, where applicable Resolution of the board of directors appointing the head of the IFC, as the case may be The corporation s business plan and any other document previously requested by the MFQ * The most recent financial statements of the corporation that intends to operate the IFC * The budgeted financial statements of the business that will constitute the IFC (for the first three years of operation) Detailed organization chart of the business that will constitute the IFC * Proof of registration or proof of exemption from registration with the relevant regulatory bodies, if need be (applies solely to investment dealers and advisers) (see section 6) Please enclose a cheque payable to the Minister of Finance. The fee schedule applicable to this application can be consulted on the Ministère des Finances website. * You may mail file your application without financial statements or proof of registration with the regulatory bodies, if you indicate below the date on which you plan to send them to us. I declare that I have enclosed all the requisite documents with the application or have explained their absence, as the case may be. yyyy/mm/dd Date Signature of the person responsible for the application Tax Credit Programs for IFCs Application for IFC Qualification Certificate (August 2017) 12 of 12