Ontario Made Manufacturing Investment Tax Credit: A Strategic Boost for Manufacturers

In the heart of Canada’s manufacturing hub, Ontario’s latest tax incentive is turning heads and opening wallets.

Ontario’s manufacturing sector has long been a cornerstone of Canada’s economy, driving innovation, employment, and exports. Recognizing the sector’s pivotal role, the provincial government introduced the Ontario Made Manufacturing Investment Tax Credit (OMMITC) to bolster local manufacturers’ competitiveness.

This refundable tax credit aims to encourage investments in buildings, machinery, and equipment, ensuring that Ontario remains a prime destination for manufacturing excellence.

Understanding the Ontario Made Manufacturing Investment Tax Credit

The Ontario Made Manufacturing Investment Tax Credit (OMMITC) offers a 10% refundable Corporate Income Tax credit on qualifying investments, with a maximum annual benefit of $2 million per corporation or associated group.

Eligible investments include expenditures on buildings, machinery, and equipment used for manufacturing or processing in Ontario. This initiative is designed to reduce the cost of capital investments, thereby fostering growth and innovation within the province’s manufacturing sector.

To qualify, corporations must be Canadian-controlled private corporations (CCPCs) with a permanent establishment in Ontario. The investments must be made in new assets acquired from arm’s-length parties, ensuring that the credit supports genuine expansion and modernization efforts.

Strategic Implications for Ontario Manufacturers

The introduction of the OMMITC signifies a strategic move by the Ontario government to revitalize and strengthen the province’s manufacturing sector. By alleviating the financial burden of capital investments, the credit empowers manufacturers to modernize operations, adopt advanced technologies, and expand production capacities.

“This new tax credit will give Ontario-based manufacturers another reason to invest in homegrown, Ontario-made innovation and expand operations. As we navigate global economic uncertainty, our government is working around the clock to ensure that we are creating the right conditions for Ontario’s world-class manufacturing sector to grow and create more jobs.”
– Premier Doug Ford

Moreover, the OMMITC complements other federal and provincial initiatives, such as the Scientific Research and Experimental Development (SR&ED) Tax Credit, creating a comprehensive funding system for manufacturers aiming to innovate and grow.

Claiming the Tax Credit: A Step-by-Step Guide

Claiming the OMMITC involves an eligibility process:

1. Determine Eligibility: Ensure your corporation is a CCPC with a permanent establishment in Ontario and that the investments qualify under the program’s criteria.
2. Complete Schedule 572: Fill out the T2 Schedule 572, detailing the eligible expenditures.
3. File with T2 Return: Submit the completed Schedule 572 alongside your T2 Corporation Income Tax return.

It’s important to note that the credit is prorated for short taxation years and must be shared among associated corporations.

Additionally, certain expenditures, such as those related to leased assets or purchases from non-arm’s-length parties, may be excluded.

Next Steps for Ontario Manufacturers

The Ontario Made Manufacturing Investment Tax Credit represents a significant opportunity for local manufacturers to enhance their operations and competitiveness.

By providing substantial funding support for capital investments, the program encourages innovation, job creation, and economic growth within the province.

Manufacturers are encouraged to assess their eligibility and take advantage of this incentive to drive their businesses forward. For detailed guidance and assistance in navigating the application process, connect with our Ryan Canada government funding team of experts.

Update as of May 20, 2025: Enhancements to the Ontario Made Manufacturing Investment Tax Credit

The Ontario government has announced plans to temporarily enhance the Ontario Made Manufacturing Investment Tax Credit (OMMITC), increasing the refundable tax credit rate from 10% to 15% for qualifying Canadian-controlled private corporations (CCPCs).

his enhanced rate applies to eligible capital investments made in Ontario between May 15, 2025, and January 1, 2030, covering expenditures on buildings, machinery, and equipment used in manufacturing or processing. The enhanced credit remains subject to a maximum annual limit of $20 million per taxation year.

Additionally, the government will introduce a new non-refundable version of the tax credit at 15%, extending eligibility to corporations that are not CCPCs, thereby broadening access and incentivizing further investment within Ontario’s manufacturing sector.