Tax Credit Financing
As one of our core service offerings, Tax Credit Financing is one of our principal services and is the basis and business of the company and the platform on which TriStar's business model performs. In some instances and because of our bundled and our unique fee structure TriStar's fee may also be tax creditable, adding further labour savings to the production.
This type of financing provides client productions access to working capital during production based on tax credit refund amounts.
For the purpose of Tax Credits, productions shooting in Canada fall under two categories:
- Service Productions, which originate outside the country and do not have a Canadian-written script, director, producer or cast and,
- Canadian (CAVCO), productions which have achieved 6 or more points of Canadian content including Writer, Director, Producer, Principal Actors, Canadian Production Company etc.
| BC & Ontario | Service Production | CAVCO Production |
| Provincial Incentive | 25% | 35% |
| Federal Incentive | 16% | 25% |
Example 1 - Production Services Tax Credit:
Referring to the chart above and using a Service Production with eligible labour expenditures of $1,000,000: TriStar will use the 25% Provincial Incentive to calculate that a $250,000 gross rebate would accrue to the production. This reduces the balance of eligible labour to $750,000. TriStar will then apply the 16% Federal Incentive to calculate that a $120,000 gross rebate would accrue to the production. The total available gross tax credit in this example would be the sum of the Provincial and Federal rebate figures i.e., $250,000 + $120,000 = $370,000.
Example 2 - CAVCO Eligible Production:
If the same $1,000,000 labour spend were occur inside of a Qualifying Canadian Production, TriStar would use the higher 35% Provincial incentive to calculate that a $350,000 gross rebate would accrue to the production. This reduces the balance of eligible labour to $650,000. TriStar would then apply the higher 25% Federal incentive to calculate that a $162,500 gross rebate would accrue to the production. The total available gross tax credit in this example would be the sum of the Provincial and Federal rebate figures i.e., $350,000 + $162,500 = $512,500