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Home -> Atlantic Provinces -> Newfoundland & Labrador -> NL Dividend Tax Credit

Newfoundland & Labrador Dividend Tax Credits

NL Eligible Dividends

NL Income Tax Act, 2000 s. 20(1)(b)

The NL Income Tax Act defines the eligible dividend tax credit rate as a percentage of the taxable (grossed-up) dividend.

Bill 15, An Act to Amend the Income Tax Act, 2000 No. 2 increased the eligible dividend tax credit rate from 5.4% to 6.3%, effective January 1, 2022.

NL Dividend Tax Credit Rate for Eligible Dividends
Year	Gross-up Rate	% of Grossed-up Dividend	% of Actual Dividend
2022+	38%	6.3%	8.69%
2014 Jul - 2021 Dec	38%	5.4%	7.45%
2013 - 2014 Jun	38%	11.0%	15.18%

See the marginal tax rates for NL for current marginal tax rates for eligible and non-eligible dividends and other income.

NL Dividend Tax Credit for Non-Eligible Dividends

NL Income Tax Act, 2000 s. 20(1)(a)

The NL Income Tax Act defines the non-eligible dividend tax credit rate as a percentage of the taxable (grossed-up) dividend.

Bill 15, An Act to Amend the Income Tax Act, 2000 No. 2 reduced the non-eligible dividend tax credit rate from 3.5% to 3.2%, effective January 1, 2022.

The NL 2024 Budget reduced the small business corporate tax rate from 3% to 2.5% effective January 1, 2024. There was no mention in the budget of whether this would result in a reduction to the non-eligible dividend tax credit. We'll report back once a Bill is tabled for the tax change.

The current and past Newfoundland and Labrador rates for non-eligible dividends are shown in the following table.

NL Dividend Tax Credit Rate for Non-Eligible Dividends
Year	Gross-up Rate	%of Federal Gross-up	% of Grossed-up Dividend	% of Actual Dividend
2022+	15%	24.53%	3.2%	3.68%
2019 - 2021	15%	26.83%	3.5%	4.03%
2018	16%	25.38%	3.5%	4.06%
2016 Jul - 2017 Dec	17%	24.09%	3.5%	4.10%
2016 Jan-Jun	17%	28.22%	4.1%	4.80%
2014 Jul-Dec & 2015	18%	26.88%	4.1%	4.84%
2014 Jan-Jun	18%	32.78%	5%	5.90%
2013	25%	25%	5%	6.25%

Revised: March 21, 2024

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