Forestry businesses in the Province of New Brunswick may qualify for a remission on provincial property taxes paid in 2009, if they make eligible capital investments in manufacturing and processing machinery or equipment in 2009.

Why was this tax remission introduced?

The 2009-10 budget provided for a targeted tax credit to qualifying forestry companies as an incentive for them to make investments in manufacturing and processing machinery or equipment, thereby improving their competitiveness.

What is the amount of the tax remission?

Qualifying forestry companies are eligible for a remission of 50% of their capital investments made between January 1, 2009 and December 31, 2009 in manufacturing and processing machinery or equipment, up to a maximum of 50% of the total 2009 provincial property taxes paid by the company. The remission rebate will be the lesser of 50% of the approved capital expenditure or 50% of the provincial property taxes paid for this year. Also, it is important to note that the property taxes paid that are eligible for the remission are provincial taxes only not municipal taxes.

What are eligible investments?

Eligible investments will be those expenditures in manufacturing and processing machinery or equipment of a capital nature that will qualify as depreciable assets, generally prescribed as Class 8 depreciable property for income tax purposes (Capital Cost Allowance). However, other capital expenditures directly related to the investment in manufacturing or processing machinery and equipment, and prescribed for income tax purposes under a class of property other than Class 8, will also be eligible.

What forestry industries may be eligible for this remission?

Industries include:

• Hardwood sawmills;
• Wood preservation;
• Veneer, plywood and engineered wood product manufacturing;
• Millwork;
• Wood container and pallet manufacturing;
• Prefabricated wood building manufacturing;
• Other miscellaneous wood product manufacturing;
• Pulp, paper and paperboard mills; and
• Converted paper product manufacturing.

Are there any forestry industries that may not be eligible?

Yes. A forestry business will not qualify for a remission if any of its products are included within the scope of the Softwood Lumber Agreement 2006 between the Governments of Canada and the United States.

Who will confirm eligibility?

The Department of Business New Brunswick will confirm the eligibility of companies that submit applications and will verify that the expenditures made are eligible investments.

Who will confirm the provincial property taxes paid?

The Department of Finance will verify the provincial property taxes paid on properties assessed in the name of the applicant, using property account numbers provided by the applicant.

Important: Property taxes and any arrears must be paid in full before remissions can be paid.

What is the deadline to apply for the tax remission?

Companies have until March 31, 2010 to claim for investments made against their 2009 paid-up property taxes.

Besides the application forms, is there any other documentation required?

Applicants will have to provide a list of capital expenditures in manufacturing and processing machinery or equipment, accompanied by photocopies of invoices and proof of payment.

To what address should I send the application form and materials?

Business New Brunswick
C.P. 6000
Fredericton, New Brunswick E3B 5H1

To access the 2009 Forestry Industry Remission Application form click here.

Could a company be audited?

Yes, Any company receiving a remission rebate is subject to audits and inspections to verify the accuracy of applications made and appropriateness of remissions paid.

Where can I call should I require further information?

For more information on the tax remission or concerning your eligibility please contact:

Business New Brunswick
Business Financial Support Division
(506) 453-2794.

You can also visit the departmental Web site at http://www.gnb.ca/0398/index-e.asp.

For information relating to provincial property taxes or to inquire on the status of your remission rebate, please contact:

Department of Finance
Account Management, Tax Accounting and Refunds
(506) 453-2404.