Build Your Business With Canadian Government Grants, Deductions and Incentives

Wolseley PRO Pipeline Blog

When building your HVAC business or plumbing business, you may find yourself wondering where to get the money from to build your business up. The Government of Canada is one of the many pathways you can use to help you build your business through their grants, deductions and incentives.

There are two main incentives for HVAC and plumbing business owners from the Canadian Government: The Apprenticeship Tax Deduction for Employers and the Deduction of Tools For Tradespersons.

Apprenticeship Tax Deduction For Employers

One of the best Canadian government incentives to expand and grow your HVAC or Plumbing business is the Apprenticeship Job Creation Tax Credit (AJCTC) for employers. This is a subcategory of Investment Tax Credits provided by the Government of Canada to give employers the opportunity to bring aboard new trades talent and create job opportunities.

The Apprenticeship Job Creation Tax Credit is a non-refundable tax credit that covers 10% of the eligible salaries and wages payable to apprentices. The credit covers up to a maximum of $2000 for each apprentice. If you are unsure if someone qualifies as an apprentice, visit the Red Seal Trades website to see the list of trades covered by the Provincial and Territorial Apprenticeship Act. Refrigeration and Air Conditioning Mechanics and Plumbers are some of the many trades covered by this Act.

To make an Apprenticeship Job Creation Tax Credit claim on your individual income tax return, use line 412 - Investment Tax Credit and fill in form T2038 (IND) and Investment Tax Credit (Individuals).

For more information on this Apprenticeship Tax Deduction, visit the Apprenticeship Job Creation Tax Credit page on the Government of Canada website.


Deduction For Tools For Tradespersons

Wolseley's Silverline toolbox as example of tool deduction item

Another way to regain some of the costs of business is through the Government of Canada’s Employed Tradespersons (and Apprentice Mechanics) Deduction For Tools. If you are working as a tradesperson or as a qualified apprentice, you can deduct the cost of tools you need to buy for your job. This includes the cost of GST, PST or HST.

Eligible tools refer to any tools or equipment you need (including a toolbox) that you need for your job or tools your employer certifies as necessary for you provide as part of your job. This provides a great opportunity for your business to use new tools for projects and retain them for future projects.

With new tools at deducted costs, you can feel confident to invest in tools and expand your business skill set. The tax return for Tradesperson’s tools expenses can be found on Line 1770 of Form T777, Statement of Employment Expenses.

For more information on the Deduction For Tools For Tradespersons, visit the Employed Tradespersons (and apprenticeship mechanics) page on the Government of Canada website.

Don’t forget, if you sign up for Wolseley PRO Rewards Loyalty Program, you can also build rewards points with qualifying tool purchases from Wolseley. This can result in savings and promotions on tools you want to use, plus bonus perks like products and vacations.

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Filing For Your Grants and Tax Credits

When filing for tax deductions and tax credits, it’s important to have accurate employment records and accurate cost records to know exactly how much you can deduct from bringing on apprentices and how much of a deduction you get for purchasing tools.

If you are unsure about your taxes, what forms to use and what employee records are necessary, check out Wolseley’s Guide to Canadian Taxes and When to Charge GST and HST On Invoices and the Nuts and Bolts of Payroll and Benefits for Small Businesses. These guides provide helpful tips so you can run your business efficiently and adhere to Canadian Government tax programs. You can also turn to the help of an accountant or tax specialist who has extensive knowledge on Canadian Government Grants, Deductions and Tax Credits for Tradespeople.

To get more tips on building your HVAC or Plumbing business, sign up and be a Wolseley PRO, and get the information you need straight to your inbox.