Natural Gas Tax Credit

The natural gas tax credit is a credit for the cost of natural gas you acquired at an LNG facility inlet meter. You can use this credit to reduce the amount of B.C. corporate income tax you have to pay for a taxation year.

The Natural Gas Tax Credit Regulation increased the percentage of the cost of natural gas used to calculate the Natural Gas Tax Credit from 0.5% to 3.0% on or after January 1, 2017—an increase of 2.5%.

You can claim the credit if you:

  • owe B.C. corporate income tax, and
  • engage in or have income from liquefaction activities, and
  • have a permanent establishment in B.C. in a year

Any unused credit amount can be carried forward to subsequent taxation years as long as you are still engaged in or have income from liquefaction activities and continue to have a permanent establishment in B.C.

The maximum credit you can claim in a taxation year is the least of:

  • 3% of the cost of natural gas you acquired at the LNG facility inlet meter plus any carry forward amounts from previous years,
  • Your B.C. corporate income tax payable after all other B.C. income tax credits have been deducted, and
  • The amount used to reduce your B.C. corporate income tax to the amount that would be payable if the B.C. general corporate income tax rate was 8%.