The Film Employment Tax Credit Regulations

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 1 The Film Employment Tax Credit Regulations being Chapter F-13.11 Reg 1 (effective January 1, 1998) as amended by Saskatchewan Regulations 65/2002, 2/2005, 3/2006 86/2008, 122/2008, 19/2012 and 112/2014. NOTE: This consolidation is not official. Amendments have been incorporated for convenience of reference and the original statutes and regulations should be consulted for all purposes of interpretation and application of the law. In order to preserve the integrity of the original statutes and regulations, errors that may have appeared are reproduced in this consolidation.

2 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT Table of Contents 1 Title 2 Interpretation 3 Repealed 4 Prescribed post-production services and activities 5 Waiver of residency requirements 6 Percentage paid to eligible employees 6.1 Additional film employment tax credit 7 Application form and deadlines 7.1 Statement of finances 7.2 Statement of residency 8 Coming into force Table 1 Table 2 Form A Form B Form C Appendix Activities and Services of Certain Categories of Persons Positions Forms Application Form Statutory Declaration if Total Production Costs are Less than $200,000 Statement of Saskatchewan Residency

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 3 CHAPTER F-13.11 REG 1 The Film Employment Tax Credit Act Title 1 These regulations may be cited as The Film Employment Tax Credit Regulations. Interpretation 2 In these regulations, Act means The Film Employment Tax Credit Act. 9 Jly 99 cf-13.11 Reg 1 s2. 3 Repealed. 19 Jly 2002 SR 65/2002 s3. Prescribed post-production services and activities 4 For the purposes of clause 2(1)(l) of the Act, services and activities provided by the categories of persons set out in Table 1 of the Appendix are prescribed as post-production services and activities. 9 Jly 99 cf-13.11 Reg 1 s4. Waiver of residency requirements 5(1) In this section, non-saskatchewan resident means a person who resides outside Saskatchewan and on whose behalf an application is made pursuant to section 4 of the Act to waive the residency requirements of the Act. (2) For the purpose of allowing a non-saskatchewan resident to qualify as an eligible employee or an eligible individual, the minister may, pursuant to subsection 4(3) of the Act, waive the residency requirements imposed by the Act if the eligible corporation making the application: (a) satisfies the minister that: (i) there are no qualified Saskatchewan residents to fill the position to be occupied by the non-saskatchewan resident; and (ii) the non-saskatchewan resident has agreed to train a Saskatchewan resident so that the Saskatchewan resident will be able to qualify for a similar position; and (b) provides the minister with a detailed training plan agreed to by the non-saskatchewan resident and the Saskatchewan resident to be trained. (3) Without limiting the authority of the minister pursuant to subsection 4(4) of the Act, the minister may impose all or any of the following terms and conditions when approving an application to waive residency requirements: (a) a term directing that a percentage lower than that set out in subsection 12(2) of the Act be used when calculating the film employment tax credit payable for the eligible salary paid to the non-saskatchewan resident;

4 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT (b) a term directing that only a portion of the eligible salary paid to the non-saskatchewan resident may be used when calculating the film employment tax credit payable for the eligible salary paid to the non-saskatchewan resident; (c) a term directing that only wages or salary paid during a specified period to the non-saskatchewan resident be used when calculating the film employment tax credit payable for the eligible salary paid to the non-saskatchewan resident. (4) All applications made pursuant to section 4 of the Act to waive the residency requirements of the Act must be received by the minister on or before December 31, 2011. (5) If the minister waives the residency requirements imposed by the Act, the salary, wages and remuneration that are paid to non-saskatchewan residents and claimed by the eligible corporation as eligible salaries shall not exceed 25% of the total eligible salaries claimed for the eligible film. 9 Jly 99 cf-13.11 Reg 1 s5; 21 Jan 2005 SR 2/2005 s2; 3 Feb 2006 SR 3/2006 s3; 19 Dec 2008 SR 122/2008 s3. Percentage paid to eligible employees 6 For the purposes of clause 11(b) of the Act, an eligible corporation must have paid at least 25% of its salaries and wages related to the production to eligible employees, but the corporation is not required to have paid that 25% for each stage of the production. 9 Jly 99 cf-13.11 Reg 1 s6. Additional film employment tax credit 6.1 For the purposes of subsection 12(4.1) of the Act: (a) the prescribed amount is $3 million; and (b) the prescribed positions are as set out in Table 2 of the Appendix. 3 Feb 2006 SR 3/2006 s4. Application form and deadlines 7(1) For the purposes of clauses 6(1)(a) and 13(1)(a) of the Act, Form A of the Appendix is prescribed as the application form. (2) For the purposes of subsection 6(3) of the Act: (a) for any production for which principal photography is completed before February 1, 2006, the corporation must apply to register the production as an eligible film at the time it applies for a film employment tax credit with respect to the production or at any time before that; and (b) subject to subsection (2.1), for any production for which principal photography is commenced or continued on or after February 1, 2006, the corporation must apply to register the production as an eligible film on or before the last day of principal photography on the production. (2.1) A corporation shall apply pursuant to clause (2)(b) to register a production as an eligible film before July 1, 2012, and no application is to be received on or after that date.

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 5 (3) If principal photography on an eligible film is completed on or before December 31, 2005, application for a film employment tax credit respecting the eligible film must be submitted to the minister in accordance with section 13 of the Act: (a) after completion of the eligible film; and (b) on or before December 31, 2007. (4) If principal photography on an eligible film is completed after December 31, 2005, application for a film employment tax credit respecting the eligible film must be submitted to the minister in accordance with section 13 of the Act: (a) after completion of the eligible film; (b) not more than two years after the end of the qualified eligible corporation s taxation year in which principal photography on the eligible film is completed; and (c) not later than December 31, 2014. 3 Feb 2006 SR 3/2006 s5; 5 Apr 2012 SR 19/ 2012 s2; 2 Jan 2015 SR 112/2014 s2. Statement of finances 7.1 For the purposes of clause 13(1)(b) of the Act, a statement of finances submitted to the minister as part of an application for a film employment tax credit must be in one of the following forms, as the case requires, detailing the total production costs for the eligible film: (a) if total production costs for the eligible film are less than $200,000, a statutory declaration in Form B of the Appendix; (b) if total production costs for the eligible film are $200,000 or more but less than $500,000, a review engagement report in accordance with sections 8100 and 8200 of the Canadian Institute of Chartered Accountants Handbook; (c) if total production costs for the eligible film are $500,000 or more, an audited financial statement in a form satisfactory to the minister. 19 Jly 2002 SR 65/2002 s4. Statement of residency 7.2(1) For the purpose of clause 13(1)(d) of the Act, Form C of the Appendix is prescribed as the form for the statement of residency. (2) A statement of residency must be completed by each eligible individual and each eligible employee whose eligible salaries: (a) are being claimed respecting the eligible film; and (b) exceed $500. 19 Jly 2002 SR 65/2002 s4. Coming into force 8 These regulations come into force on the day on which they are filed with the Registrar of Regulations but are retroactive and are deemed to have been in force on and from January 1, 1998. 9 Jly 99 cf-13.11 Reg 1 s8.

6 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT Appendix TABLE 1 [Section 4] Activities and Services of Certain Categories of Persons ADR Assistant ADR Preparer ADR Recording Engineer ADR Supervisor Arranger Assistant Editor Assistant Foley Technician Assistant Mixer Assistant Negative Cutter Assistant Sound Supervisor Assistant Sound Designer Audio Technician Boom Operator CGA Artist Coding Technician Colour Timer Composer s Assistant Computer Animation Artist Computer Art Director Computer Creative Director Computer Digital Production Technician Computer Graphics Designer Computer Interactive Consultant Computer Interface Designer Computer Navigational Designer Computer Production Manager Computer Programmer Computer Technical Supervisor Copyist Dialogue Supervisor Dialogue Editor Digital Composer Duplicating Technician Engineer Foley Artist Foley Assistant Recordist Foley Editor Foley Mixer Foley Recordist Foley Spotter Foley Supervisor Foley Technician Graphic Artist Inspection/Vacuum Technician Interactive Writer Location Sound Mixer Location Sound Recordist Loop Group Editor Loop Group Recordist Loop Group Supervisor Loop Group Talent Manufacturing Supervisor Master Mix/M&E Engineer Master Mix/M&E Supervisor Mixdown Engineer Mixer Music Editor Music Mixer Music Producer Musician Negative Cutter Network Consultant Network Technician Off Line Editor On Line Editor Post-Production Supervisor Printing Technician Processing Technician Projectionist Re-recording Mixer Receptionist Recording Engineer Senior Editor Session Booker/Steward Sound Editor Sound Effects Editor (FX Editor) Sound Effects Supervisor Sound Production Manager Sound Recordist Sound Supervisor Special Effects Supervisor Storyboard Artist Subtitling Technician Supervising Editor Supervising Sound Designer Video Credits Designer Video Technician

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 7 Costume Designer First Assistant Director Property Master Dolly Grip Key Grip Locations Manager Production Coordinator Production Designer Construction Coordinator Sound Recordist TABLE 2 [Clause 6.1(b)] Positions 26 Sep 2008 SR 86/2008 s2.

8 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT (Check one) FORM A [Subsection 7(1)] Application Form SASKATCHEWAN FILM EMPLOYMENT TAX CREDIT APPLICATION Initial Application (provide estimated figures) Final Application (provide actual figures) For SaskFilm Use Date Received: Tracking Number: Entered: TITLE OF PRODUCTION: PREVIOUS TITLES: IF TELEVISION SERIES: CYCLE NO. EPISODE NOs. PART I APPLICATION INFORMATION PRODUCTION COMPANY: Address: City/Province: Postal Code: Phone: Fax: Email: Contact Person: Title: Corp. Fiscal Year End: Corp. Income Tax Account No.: Incorporated provincially or federally: Provincially Yes No Province: Federally Yes No SASKATCHEWAN PARENT PRODUCTION COMPANY (if applicable) PARENT COMPANY: Address: City/Province: Postal Code: Phone: Fax: Email: Contact Person: Title: Corp. Fiscal Year End: Corp. Income Tax Account No.: Incorporated provincially or federally: Provincially Yes No Province: Federally Yes No Saskatchewan Film Employment Tax Credit Application Page 1 of 9

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 9 OFFICERS OF PRODUCTION COMPANY (attach a separate sheet for parent company) NAME CITIZENSHIP/RESIDENCY DIRECTORS OF PRODUCTION COMPANY (attach a separate sheet for parent company) NAME CITIZENSHIP/RESIDENCY Does the Production Company have a permanent establishment in Saskatchewan? Yes No Did the Production Company have a permanent establishment in Saskatchewan throughout production of the eligible film and on the last day of the taxation year for which the tax credit is claimed? Yes No Is all or part of the income of the Production Company exempt from tax pursuant to Part I of the Income Tax Act (Canada)? Yes No Does the Production Company primarily carry on the business of: (a) Film Production? Yes No (b) Video Production? Yes No (c) Multimedia Production? Yes No Is the Production Company controlled, directly or indirectly in any manner whatever, by: (a) another corporation that does not, or a group of corporations that do not, have a permanent establishment in Saskatchewan? Yes No (b) an individual who does not, or a group of individuals who do not, reside in Saskatchewan? Yes No Does the Production Company hold a broadcast licence issued by the Canadian Radio-television and Telecommunications Commission (CRTC)? Yes No Does the Production Company deal at non-arm s length with a broadcaster? Yes No Saskatchewan Film Employment Tax Credit Application Page 2 of 9

10 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT CO-PRODUCTION INFORMATION: Is this project a Co-Production? Yes No If so, does the applicant share in copyright ownership? Yes No Applicant s share of ownership of copyright % CO-PRODUCER S INFORMATION: CO-PRODUCER: Address: City/Province/State: Postal Code: Phone: Fax: Email: Contact Person: Title: PART II ELIGIBILITY REQUIREMENTS A. Calculation of Salaries and Wages (For Initial Application, provide estimated salaries and wages) (For Final Application, provide actual salaries and wages) Total salaries and wages paid by the Production Company for this production $ (A) Salaries and wages paid in Saskatchewan to eligible employees for this production (excluding deemed labour) $ (B) Percentage of salaries and wages paid in Saskatchewan to eligible employees for this production. Line (B) divided by Line (A) (must be a minimum of 25% of salaries and wages paid to eligible employees for this production) % B. Rural Bonus Requirements (only required if applying for a rural bonus) Location and address of fixed base of operations (production office) Address: Phone: Fax: Approximate distance from Regina or Saskatoon From (y/m/d) To (y/m/d) Office Location No. of Days Pre-production... Production... Post-production/wrap... Saskatchewan Film Employment Tax Credit Application Page 3 of 9

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 11 -

12 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT PART III DISTRIBUTION DISTRIBUTION RIGHTS (attach separate sheet if necessary) Distribution Company: Address: Amount of Advance or Pre-sale Media Term Date of start of Term Distribution Company: Address: Amount of Advance or Pre-sale Media Term Date of start of Term BROADCAST RIGHTS (attach separate sheet if necessary) Broadcaster: Address: Amount of Licence Media Term Date of start of Term Broadcaster: Address: Amount of Licence Media Term Date of start of Term Broadcaster: Address: Amount of Licence Media Term Date of start of Term Broadcaster: Address: Amount of Licence Media Term Date of start of Term Saskatchewan Film Employment Tax Credit Application Page 5 of 9

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 13 PART IV DESCRIPTION OF PRODUCTION Production Category (please check) Genre Fiction Performing Arts Children Music Variety Education/Instructional Magazine Documentary Other Type Anthology Feature Film TV Program Mini Series MOW/MFT Pilot Series Direct to Video Other Multimedia Animation Market Theatrical Non-Theatrical Television Multimedia Indicate: (1) for primary (2) for secondary Total running length (in minutes) If series, number of episodes If multimedia, number of CD s Length in minutes (per episode) PRODUCTION SPECIFICATIONS Original Version English French Double Shooting (English and French) Other Dubbed or Subtitled Version English French Other PRODUCTION FORMAT Production Film mm Tape Multimedia/other Post-Production Film mm Tape Other Delivery or Release Film mm Tape Other PRODUCTION SCHEDULE LIVE ACTION FROM (year-month-day) TO (year-month-day) Preparation Production Post-Production Answer Print/Video Master/CD ROM ANIMATION FROM (year-month-day) TO (year-month-day) Storyboards Production Post-Production Answer Print Saskatchewan Film Employment Tax Credit Application Page 6 of 9

14 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT PART V FINANCIAL INFORMATION FINANCING SOURCES FINANCING SOURCE AND NATURE OF AMOUNT % CONFIRMED NAME OF FUND PARTICIPATION ($CDN) TOTAL BUDGET $ 100% PART VI CALCULATION OF SASKATCHEWAN FILM EMPLOYMENT TAX CREDIT A. INTERPRETATION For the purpose of calculating the Saskatchewan Film Employment Tax Credit: (a) Eligible salaries means eligible salaries within the meaning of The Film Employment Tax Credit Act (Saskatchewan); (b) Deemed Labour means the salaries and wages or other remuneration paid to employees or individuals for whom the residency requirements have been waived. Saskatchewan Film Employment Tax Credit Application Page 7 of 9

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 15 B. CALCULATION OF TOTAL PRODUCTION COSTS (For Initial Application, provide estimated total production costs) (For Final Application, provide actual total production costs) Total Eligible Production Costs $ (A) Government Assistance (as defined in The Film Employment Tax Credit Act) 1. $ 2. $ 3. $ 4. $ 5. $ Total Government Assistance $ $ (B) Eligible Cost of Production (Subtract Line (B) from Line (A)) $ (C) Line (C) multiplied by 50% Total spent in Saskatchewan (does not include Deemed Labour) $ (D) $ (E) C. ELIGIBLE SALARIES Saskatchewan Labour $ Deemed Labour $ Total Labour (Saskatchewan Labour and Deemed Labour) (Enter the lesser of Line (D) and Line (F)) Total Labour Tax Credit (Line (G) x 45%) $ (F) $ (G) $ (H) D. RURAL BONUS Rural Bonus 5% of total production costs spent in Saskatchewan if base of operations is located more than 40 km from Regina or Saskatoon. Total Rural Bonus (the lesser of Line (C) and Line (E) x 5%) $ (I) E. KEY POSITION BONUS Key Position Bonus 5% of eligible salaries if at least six prescribed positions are filled by Saskatchewan residents and if total production costs (Line (C) above) meet or exceed the prescribed amount. Total Eligible Salaries (Line (G) above) Total Key Position Bonus (Line (J) x 5%) $ (J) $ (K) TOTAL TAX CREDIT (Line (H) + Line (I) + Line (K)) $ (L) Saskatchewan Film Employment Tax Credit Application Page 8 of 9

16 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT 26 Sep 2008 SR 86/2008 s2; 19 Dec 2008 SR 122/2008 s4.

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 17 FORM B [Clause 7.1(a)] Statutory Declaration If Total Production Costs are Less than $200,000 CANADA IN THE MATTER OF THE FILM PROVINCE OF SASKATCHEWAN EMPLOYMENT TAX CREDIT ACT TO WIT: I, of the City of in the Province of do solemnly declare that: 1. I am the Producer of the production entitled, and as the producer I have personal knowledge of the matters stated in this statutory declaration. 2. The total production costs for the production mentioned in paragraph 1 were $. 3. The breakdown of Total Production Costs and the Eligible Labour Expenditure Schedule attached to this declaration, as Exhibits A and B respectively, are true and complete in every respect. DECLARED BEFORE ME at the of, in the Province of this day of, 20 A COMMISSIONER FOR OATHS (Signature) in and for the Province of Saskatchewan. My commission expires or Being a solicitor. Note: Please complete and attach Exhibits A and B. This declaration must be made before a notary public, under seal, if declared outside Saskatchewan.

18 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT Exhibit A to Statutory Declaration Total Production Costs (suggested format only) For the Period:, 20 to, 20 Above the Line: Story rights Scenario Development Producer Director Stars Total above the line: Below the Line: Production Cast Extras Production staff Design labour Construction labour Set dressing labour Wrangling labour Wardrobe labour Makeup/hair labour Camera labour Electrical labour Grip labour Production sound labour Transport labour Fringes Production office Site expense Unit expense Travel and living expense Transportation Construction materials Art supplies Set dressing labour Props Animals Wardrobe supplies Makeup/hair supplies Camera equipment Electrical equipment Grip equipment Sound equipment Production laboratory Total below the line:

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 19 Post Production: Editorial labour Editorial equipment Video post production picture Video post production sound Music Titles/optical/stock footage Total post production: Summary of Total Production Costs: Total above the line $ Total below the line $ Total post production $ Total Production Costs $

20 F-13.11 REG 1 FILM EMPLOYMENT TAX CREDIT Exhibit B to Statutory Declaration Eligible Labour Expenditure Schedule (suggested format only) For the Period:, 20 to, 20 Saskatchewan Resident Labour (Name/Address/SIN optional for initial application) SIN Eligible Position Name Address Number Labour Saskatchewan Service Provider Labour (Company/Name/Address/SIN optional for initial application) SIN Total Eligible Position Company Name Address Number Labour Labour Total Saskatchewan Labour Saskatchewan Deemed Labour (Names optional for initial application) Deemed Deemed Saskatchewan Saskatchewan Deemed Position Name Trainee Name Trainee Position Amount Total Deemed Labour Total Eligible Labour Note: The Total Eligible Labour must agree with the amount claimed in the application form. 19 Jly 2002 SR 65/2002 s5.

FILM EMPLOYMENT TAX CREDIT F-13.11 REG 1 21 FORM C [Section 7.2] Statement of Saskatchewan Residency I,, state for the purpose of The Film Employment Tax Credit Act (Saskatchewan) that: 1. I performed the services of commencing (day/month/year) and ending (day/month/year) on the production entitled for. (name of Production Company or other company by whom you were employed) 2. I resided in Saskatchewan throughout the period mentioned in paragraph 1. 3. In addition to residing in Saskatchewan throughout the period mentioned in paragraph 1: (a) I resided in Saskatchewan on December 31 of the year or years during which the production was made; or (b) the production was started and completed in the same calendar year, and I resided in Saskatchewan on December 31 of that year or on December 31 of the previous year. 4. My present address is: (apt./number/street) (city/town) (province) (postal code) 5. My social insurance number is: NAME OF APPLICANT (please print) (last name) (first name) (Signature of applicant) WITNESS (must be an official of the Production Company) (please print) (date) (last name) (first name) (Signature of witness) (title) 19 Jly 2002 SR 65/2002 s5; 3 Feb 2006 SR 3/ 2006 s6.