New tax break for Ontario labour funds

Effective Jan. 1, the province created a special category of labour funds, known as research-oriented investment funds (ROIFs). To qualify, the fund has to invest a portion of its assets directly in projects being carried out by a university, college, research institute or hospital.

Investors in qualifying funds receive an extra 5% provincial credit, which will be paid in the form of a rebate not to exceed $250 in any year (based on a maximum investment of $5,000). For qualifying funds, that brings the total tax credit in Ontario to 35% (20% provincial, 15% federal).

The New Generation Biotech Equity Fund unveiled last month by Triax qualifies for the extra credit. However, its companion fund, New Generation Biotech Balanced, does not. The only other fund that qualifies for the special credit this year is the Canadian Medical Discoveries Fund.