The Clean Technology ITC: Canada’s Workhorse Credit
Thirty percent of capital cost, refundable in cash, for the broadest equipment list in the clean economy stack — and since Bill C-15, wider still. What qualifies, who claims, and where the rate steps down.
At a Glance — Where Things Stand
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The rate 30% Of capital cost, refundable, for property acquired and available for use from March 28, 2023 through 2033 — 15% in 2034. |
Who claims Corps + REITs Taxable Canadian corporations and REIT mutual fund trusts, including through partnerships. |
The haircut −10 points Skip the prevailing wage and apprenticeship election and 30 becomes 20. |
Our View
The Clean Technology ITC is the closest thing Canada has to the US 48E — and in three respects it is more generous: it is refundable without any transfer market, it has no foreign-content test attached today, and its equipment list reaches technologies the US credit does not, from ground-source heat pumps to non-road zero-emission vehicles and their charging. The domestic content consultation of early 2026 is the caveat: content conditions are under active design, and procurement contracts signed now should anticipate them.
The claims discipline is the available-for-use test. The credit lands in the year property becomes available for use, not the year it is paid for — and CRA is pre-auditing claims before refunding. Clean commissioning evidence and capital cost allocation files decide how fast the cash arrives.
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What Qualifies
Exclusions matter as much: road vehicles, personal-use property, and preliminary work — feasibility, FEED, permitting, land clearing — sit outside the credit base, and government and non-government assistance reduces the capital cost claimed. |
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Rates and the ClockProperty must be acquired after March 27, 2023 and become available for use before 2035. The labour election covers prevailing wages and the 10 percent Red Seal apprenticeship effort at designated work sites; the Manufacturing ITC next door carries no such conditions, which occasionally decides which credit a mixed facility pursues for which assets. |
Thirty percent refundable, with a December window for the years already lapsed. Have the 2023–24 capital reviewed before the deadline.
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Claiming ItThe credit is claimed on Schedule 75 with the T2 return, is fully refundable, and — following Bill C-15 — prescribed forms may be filed by the later of one year after the return due date and December 31, 2026, a window that revives lapsed 2023 and 2024 claims. It stacks with Atlantic investment tax credits and accelerated CCA on the same property, but not with another clean economy ITC on the same cost. For projects also earning operating credits — a storage asset in an ancillary market, an RNG facility under the CFR — the capital credit and the operating programme run in parallel; nothing in the ITC consumes the environmental attributes the project produces. |
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Stacking With Clean Fuel ProgrammesThe Clean Technology ITC pays on the capital; the clean fuel programmes pay on what the asset then does. Storage and charging equipment credited at 30 percent can generate CFR Compliance Category 3 credits on every megawatt-hour dispensed to vehicles — and BC LCFS credits in that market — for as long as it operates. Waste biomass equipment added by Bill C-15 sits upstream of CFR Category 2 RNG pathways the same way. The one-credit rule bars two clean economy ITCs on the same cost, but nothing in the regime consumes the operating attributes: the capital credit and the fuel credits run in parallel, and the projects that model both from the start are the ones whose economics survive diligence. |
Sources
CRA — CT ITC rates and labour requirements
BLG — C-15 filing deadline extension
KPMG — C-15 eligibility expansions
This article is general information on United States and Canadian tax law as at the date of publication, not legal or tax advice. Filing positions require the opinion of qualified tax counsel.
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© 2026 Climate Decode · Credit Deep-Dive · Reference CD-TC-CA-CT-2026 |
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