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Atlantic Provinces   ->   Prince Edward Island  -> Dividend Tax Credit
Prince Edward Island Income Tax Act s. 20

Prince Edward Island Dividend Tax Credit

Prince Edward Island's dividend tax credit rates are stated in their Income Tax Act as a percentage of the gross-up on the dividends.

The PEI government indicated in their 2006 budget that the dividend tax credit would be adjusted to preserve the integration between the corporate and personal income tax systems.

PEI Eligible Dividends

Eligible dividends currently have a gross-up of 38%.  This means that 138% of the actual dividend amount is included in taxable income.  See the Eligible Dividend Tax Credit article for details.

The PEI dividend tax credit on eligible dividends is set at a percentage of the gross-up amount. The current and prior rates for eligible dividends are shown in this table.

     PEI Dividend Tax Credit (DTC) for Eligible Dividends
Year Gross-up
Rate
%of Federal
Gross-up
% of Grossed-up
Taxable Dividend
% of Actual
Dividend
2012 + 38% 38.13% 10.50% 14.489%
2011 41% 36.11% 10.50% 14.805%
2010 44% 34.36% 10.50% 15.118%
2007 to 2009 45% 33.8333% 10.50% 15.225%

To see the marginal tax rate for eligible dividends, see the marginal tax rates page.

PEI Non-Eligible (Regular, or Small Business) Dividends

The PEI 2020 Budget announced a reduction in the small business tax rate from 3% to 2% in 2021, and reduced the non-eligible dividend tax credit rate accordingly.

See the tables of non-eligible dividend tax credit rates by province.

The current and past rates for non-eligible, or small business dividends, are reflected in the following table.

     PEI Dividend Tax Credit (DTC) for Non-Eligible Dividends
Year Gross-up
Rate
%of Federal
Gross-up
% of Grossed-up
Taxable Dividend
% of Actual
Dividend
2021 + 15% 15% 1.96% 2.25%
2019/2020 15% 21% 2.74% 3.15%
2018 16% 21% 2.90% 3.36%
2016/2017 17% 21% 3.05% 3.57%
2014/2015 18% 21% 3.2% 3.780%
2013 25% 14.5% 2.9% 3.625%
2011/2012 25% 5.0% 1.0% 1.250%
2010 25% 10.5% 2.1% 2.625%
2009 25% 16.0% 3.2% 4.000%
2008 25% 21.5% 4.3% 5.375%
2007 25% 32.5% 6.5% 8.125%

The PEI table of marginal tax rates shows the marginal tax rates for eligible and non-eligible dividends and other income.

The dividend tax credit rate is normally adjusted to reflect the changes in the small business corporate tax rate.

Revised: May 17, 2021

 

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