Mining exploration tax credit for corporate income tax frequently asked questions

The following will help answer your questions about the mining exploration tax credit (METC).

Can the METC be claimed on exploration funded by grants received under the Prospectors Assistance Program?

Qualifying expenditures must be reduced by any government assistance received or receivable. For example, if $100,000 of qualified mining exploration expenses is claimed, and a $10,000 Prospectors Assistance Grant is received, the METC would be ($100,000 - $10,000) x 20% or $18,000.

Can I benefit from the METC if I have no income tax payable?

The METC is a refundable tax credit. If there is no tax otherwise payable, the credit is refundable. For more information, please contact the Canada Revenue Agency at 1-800-663-1511.

Are qualified mining exploration expenses claimed for METC also eligible for flow-through share treatment? Can the METC be "flowed through" to investors?

No, the METC is not eligible for flow-through. However, corporations may flow through exploration expenses to investors, who may be eligible for the mining flow-through share tax credit. Please contact the Canada Revenue Agency at 1-604-666-8430 for more information on mining flow-through shares.