Budget Implementation Act, 2024, No. 1 (S.C. 2024, c. 17)

• 34 (1) Paragraph (a) of the definition flow-through mining expenditure in subsection 127(9) of the Act is replaced by the following:

  • (a) that is a Canadian exploration expense incurred by a corporation after March 2024 and before 2026 (including, for greater certainty, an expense that is deemed by subsection 66(12.66) to be incurred before 2026) in conducting mining exploration activity from or above the surface of the earth for the purpose of determining the existence, location, extent or quality of a mineral resource described in paragraph (a) or (d) of the definition mineral resource in subsection 248(1),

• (2) Paragraphs (c) and (d) of the definition flow-through mining expenditure in subsection 127(9) of the Act are replaced by the following:

  • (c) an amount in respect of which is renounced in accordance with subsection 66(12.6) by the corporation to the taxpayer (or a partnership of which the taxpayer is a member) under an agreement described in that subsection and made after March 2024 and before April 2025,

  • (d) that is not an expense that was renounced under subsection 66(12.6) to the corporation (or a partnership of which the corporation is a member), unless that renunciation was under an agreement described in that subsection and made after March 2024 and before April 2025, and

• (3) The definition government assistance in subsection 127(9) of the Act is replaced by the following:

  government assistance

  government assistance means assistance from a government, municipality or other public authority whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance, other than as an excluded loan (as defined in subsection 12(11)) or as a deduction under subsection (5) or (6); (aide gouvernementale)

• (4) The definition government assistance in subsection 127(9) of the Act, as enacted by subsection (3), is replaced by the following:

  government assistance

  government assistance means assistance from a government, municipality or other public authority whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance, other than as an excluded loan (as defined in subsection 12(11)) or as a deduction under subsection (5) or (6) or a deemed payment on account of tax payable under subsection 127.48(2); (aide gouvernementale)

• (5) The definition government assistance in subsection 127(9) of the Act, as enacted by subsection (4), is replaced by the following:

  government assistance

  government assistance means assistance from a government, municipality or other public authority whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance, other than as an excluded loan (as defined in subsection 12(11)) or as a deduction under subsection (5) or (6) or a deemed payment on account of tax payable under subsection 127.48(2) or 127.49(2); (aide gouvernementale)

• (6) Subsections (1) and (2) apply in respect of expenses renounced under a flow-through share agreement entered into after March 2024.

• (7) Subsection (3) is deemed to have come into force on January 1, 2020, and applies to loans made after December 31, 2019.

• (8) Subsection (4) is deemed to have come into force immediately after the expiration of March 27, 2023.

• (9) Subsection (5) is deemed to have come into force on January 1, 2024.

35 The Act is amended by adding the following after section 127.42:

• 36 (1) The heading before section 127.43 of the Act is repealed.

• (2) Subsection (1) is deemed to have come into force on January 1, 2022.

• 37 (1) The Act is amended by adding the following before Division E.1 of Part I:

  Marginal note:Definitions

  • 127.48 (1) The following definitions apply in this section.

    actual carbon intensity

    actual carbon intensity means the carbon intensity of hydrogen that is produced by a qualified clean hydrogen project of a taxpayer, based on the actual inputs to the production of hydrogen and actual emissions from the production of hydrogen by the project. (intensité carbonique réelle)

    average actual carbon intensity

    average actual carbon intensity means, for the compliance period of a clean hydrogen project, the number determined by the formula

    ((A × B) + (C × D) + (E × F) + (G × H) + (I × J)) ÷ K

    where

    A

    is the actual carbon intensity of the project for the first operating year of the compliance period;

    B

    is the quantity, in kilograms, of hydrogen produced by the project in the first operating year of the compliance period;

    C

    is the actual carbon intensity of the project for the second operating year of the compliance period;

    D

    is the quantity, in kilograms, of hydrogen produced by the project in the second operating year of the compliance period;

    E

    is the actual carbon intensity of the project for the third operating year of the compliance period;

    F

    is the quantity, in kilograms, of hydrogen produced by the project in the third operating year of the compliance period;

    G

    is the actual carbon intensity of the project for the fourth operating year of the compliance period;

    H

    is the quantity, in kilograms, of hydrogen produced by the project in the fourth operating year of the compliance period;

    I

    is the actual carbon intensity of the project for the fifth operating year of the compliance period;

    J

    is the quantity, in kilograms, of hydrogen produced by the project in the fifth operating year of the compliance period; and

    K

    is the total quantity, in kilograms, of hydrogen produced by the project during the compliance period. (intensité carbonique réelle moyenne)

    captured carbon

    captured carbon means captured carbon dioxide that

    • (a) would otherwise be released into the atmosphere; or

    • (b) is captured directly from the ambient air. (carbone capté)

    carbon dioxide equivalent

    carbon dioxide equivalent means the carbon dioxide emissions that would be required to produce a warming effect equivalent to the emissions of any specified greenhouse gas, as determined in accordance with the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada over an assessment period of 100 years. (équivalent en dioxyde de carbone)

    carbon intensity

    carbon intensity means the quantity in kilograms of carbon dioxide equivalent per kilogram of hydrogen produced. (intensité carbonique)

    CCUS process

    CCUS process means the process of carbon capture, utilization and storage that includes the

    • (a) capture of carbon dioxide

      • (i) that would otherwise be released into the atmosphere, or

      • (ii) directly from the ambient air; and

    • (b) storage or use of the captured carbon. (processus de CUSC)

    CCUS project

    CCUS project means a project that is intended to support a CCUS process by

    • (a) capturing carbon dioxide

      • (i) that would otherwise be released into the atmosphere, or

      • (ii) directly from the ambient air;

    • (b) transporting captured carbon; or

    • (c) storing or using captured carbon. (projet de CUSC)

    CFR carbon intensity

    CFR carbon intensity means carbon intensity as defined in subsection 1(1) of the Clean Fuel Regulations. (intensité carbonique selon le RCP)

    clean ammonia

    clean ammonia means ammonia produced from clean hydrogen. (ammoniac propre)

    clean ammonia equipment

    clean ammonia equipment means equipment that is used solely for the purpose of producing ammonia, including equipment for

    • (a) converting hydrogen into ammonia;

    • (b) heat recovery and conversion;

    • (c) nitrogen generation;

    • (d) feed storage (unless the feed is stored hydrogen) and feed compression; and

    • (e) on-site refrigeration, transportation and storage of ammonia. (matériel pour ammoniac propre)

    clean hydrogen

    clean hydrogen means hydrogen produced, whether solely or in conjunction with other gases, that has a carbon intensity of less than four. (hydrogène propre)

    clean hydrogen project

    clean hydrogen project of a taxpayer means a project involving

    • (a) the operation of eligible clean hydrogen property;

    • (b) the production of clean hydrogen; and

    • (c) if applicable, the production of clean ammonia that uses a feedstock of clean hydrogen produced by the project. (projet pour l’hydrogène propre)

    clean hydrogen project plan

    clean hydrogen project plan means a plan for a clean hydrogen project of a taxpayer that

    • (a) includes a front-end engineering design study (or an equivalent study as determined by the Minister of Natural Resources) for the project;

    • (b) sets out the expected sources of electricity to be consumed in connection with the project, including sources described in any eligible power purchase agreements;

    • (c) sets out the expected carbon intensity of the hydrogen to be produced by the project

      • (i) determined in accordance with subsection (6), and

      • (ii) supported by a report prepared by a qualified validation firm in respect of the project that includes attestations by the firm that

        • (A) the assumptions in the modelling of the expected carbon intensity are reasonable, and

        • (B) the expected carbon intensity has been determined in accordance with the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada;

    • (d) if the project is intended to produce clean ammonia, demonstrates

      • (i) that the project can reasonably be expected to have sufficient hydrogen production capacity to satisfy the needs of the taxpayer’s ammonia production facility, and

      • (ii) if the taxpayer’s hydrogen production facility and its ammonia production facility are not co-located, the feasibility of transporting hydrogen between the facilities;

    • (e) contains any information required in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document; and

    • (f) is filed by the taxpayer with the Minister of Natural Resources, in the form and manner determined by the Minister of Natural Resources. (plan de projet pour l’hydrogène propre)

    clean hydrogen tax credit

    clean hydrogen tax credit of a qualifying taxpayer for a taxation year means

    • (a) the total of all amounts each of which is the specified percentage of the capital cost to the taxpayer of an eligible clean hydrogen property that is acquired by the taxpayer in the year; and

    • (b) the total of all amounts required by subsection (12) to be added in computing the taxpayer’s clean hydrogen tax credit at the end of the year. (crédit d’impôt pour l’hydrogène propre)

    compliance period

    compliance period in respect of a clean hydrogen project of a taxpayer, means the period of time beginning on the first day of the compliance period of the project and ending on the last day of the fifth operating year of the project. (période de conformité)

    dual-use electricity and heat equipment

    dual-use electricity and heat equipment means equipment that is part of a clean hydrogen project (excluding electricity generation equipment that supports the project indirectly by way of an electrical utility grid), that supports the production of hydrogen from eligible hydrocarbons and that

    • (a) generates electrical energy, heat energy or a combination of electrical and heat energy, and more than 50% of either the electrical energy or heat energy that is expected to be produced over the first 20 years of the project’s operations, based on the most recent clean hydrogen project plan, is expected to support

      • (i) a CCUS project, unless the equipment uses fossil fuels and emits carbon dioxide that is not subject to capture by a CCUS process, or

      • (ii) a qualified clean hydrogen project, unless the equipment uses fossil fuels and emits carbon dioxide that is not subject to capture by a CCUS process; or

    • (b) is equipment that directly transmits electrical energy from equipment described in paragraph (a) to a qualified clean hydrogen project and more than 50% of the electrical energy to be transmitted by the equipment over the first 20 years of the project’s operations, based on the most recent clean hydrogen project plan, is expected to support the CCUS project or qualified clean hydrogen project. (matériel pour électricité et chaleur à double usage)

    dual-use hydrogen and ammonia equipment

    dual-use hydrogen and ammonia equipment means equipment that is part of a clean hydrogen project and that is used for the generation of oxygen or nitrogen to be used all or substantially all in hydrogen and ammonia production for the project. (matériel pour hydrogène et ammoniac à double usage)

    eligible clean hydrogen property

    eligible clean hydrogen property means property, other than excluded property, that

    • (a) is acquired by a qualifying taxpayer and becomes available for use in respect of a qualified clean hydrogen project of the taxpayer in Canada on or after March 28, 2023, determined without reference to subsection (5);

    • (b) has not been used, or acquired for use or lease, by any person or partnership for any purpose whatever before it was acquired by the taxpayer; and

    • (c) is property situated in Canada

      • (i) that is used all or substantially all to produce hydrogen through electrolysis of water, including electrolysers, rectifiers, purification equipment, water treatment and conditioning equipment and equipment used for hydrogen compression and storage,

      • (ii) that is used all or substantially all to produce hydrogen from eligible hydrocarbons, including pre-reformers, auto-thermal reformers, steam methane reformers, pre-heating equipment, syngas coolers, shift reactors, purification equipment, fired heaters, water treatment and conditioning equipment, equipment used in hydrogen compression and storage of hydrogen, oxygen production equipment and methanators,

      • (iii) that is

        • (A) clean ammonia equipment,

        • (B) dual-use electricity and heat equipment,

        • (C) dual-use hydrogen and ammonia equipment, or

        • (D) project support equipment,

      • (iv) that is physically and functionally integrated with equipment described in any of subparagraphs (i) to (iii) and that is ancillary equipment used solely to support the functioning of equipment described in any of subparagraphs (i) to (iii) within a hydrogen or ammonia production process as part of

        • (A) an electrical system,

        • (B) a feed supply system,

        • (C) a fuel supply system,

        • (D) a liquid delivery and distribution system,

        • (E) a cooling system,

        • (F) a process material storage and handling and distribution system,

        • (G) a process venting system,

        • (H) a process waste management system, or

        • (I) a utility air or nitrogen distribution system,

      • (v) that is equipment used for system safety and integrity, or as part of a control or monitoring system, solely to support equipment described in any of subparagraphs (i) to (iv), or

      • (vi) that is property used solely to convert another property that would not otherwise be described in subparagraphs (i) to (v) if the conversion causes the other property to satisfy the description in any of subparagraphs (i) to (v). (bien admissible pour l’hydrogène propre)

    eligible electricity generation source

    eligible electricity generation source means, at any time, an electricity generation source that is

    • (a) wind;

    • (b) solar;

    • (c) hydro;

    • (d) nuclear; or

    • (e) geothermal or tidal, if, at that time,

      • (i) a technology-specific input carbon intensity for the generation source is available in the Fuel LCA Model, and

      • (ii) guidance in respect of the generation source is included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada. (source admissible de production d’électricité)

    eligible hydrocarbon

    eligible hydrocarbon means, at any time,

    • (a) natural gas;

    • (b) a substance sourced all or substantially all from raw natural gas;

    • (c) an eligible renewable hydrocarbon; or

    • (d) a substance that is

      • (i) a by-product from processing one or more substances described in paragraph (a) or (b), and

      • (ii) included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at that time. (hydrocarbure admissible)

    eligible pathway

    eligible pathway means the production of hydrogen

    • (a) from electrolysis of water; or

    • (b) from the reforming or partial oxidation of eligible hydrocarbons, with carbon dioxide captured using a CCUS process. (méthode admissible)

    eligible power purchase agreement

    eligible power purchase agreement means an agreement or other arrangement in writing that

    • (a) allows, or will allow, a taxpayer to purchase electricity from an eligible electricity generation source (including incremental nameplate capacity) that

      • (i) first commenced electricity generation on or after both

        • (A) November 3, 2022, and

        • (B) the earlier of the day that is

          • (I) 24 months before the taxpayer’s first clean hydrogen project plan is filed with the Minister of Natural Resources, and

          • (II) 36 months before the day on which hydrogen is first produced by the relevant clean hydrogen project of the taxpayer, and

      • (ii) is located in

        • (A) the same province as the clean hydrogen project and is connected to the electricity grid of that province,

        • (B) the exclusive economic zone of Canada and is directly connected to the grid of the province in which the project is located, or

        • (C) another province that has a provincial grid that is directly connected to the grid of the province in which the project is located, if the taxpayer has arranged for the necessary interprovincial transmission;

    • (b) grants, or will grant, the taxpayer the sole and exclusive right to the environmental attributes associated with the electricity; and

    • (c) is entered into by the taxpayer for the primary purpose of operating the taxpayer’s clean hydrogen project during all or any portion of the first 20 years of the project’s operations. (entente pour l’achat d’électricité admissible)

    eligible renewable hydrocarbon

    eligible renewable hydrocarbon, in respect of a taxpayer, means a substance

    • (a) that is produced from non-fossil carbon;

    • (b) in respect of which a CFR carbon intensity can be determined under the Clean Fuel Regulations;

    • (c) that is included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at the time that the taxpayer files its most recent clean hydrogen project plan with the Minister of Natural Resources;

    • (d) that is sourced from a facility that first commenced production of the substance on or after both

      • (i) November 3, 2022, and

      • (ii) the earlier of the day that is

        • (A) 24 months before the taxpayer’s first clean hydrogen project plan is filed with the Minister of Natural Resources, and

        • (B) 36 months before the day on which hydrogen is first produced by the relevant clean hydrogen project of the taxpayer;

    • (e) that, if acquired by the taxpayer under an agreement, the agreement grants, or will grant, the taxpayer the sole and exclusive right to the environmental attributes associated with the substance; and

    • (f) that is acquired or produced by the taxpayer for the sole purpose of operating the clean hydrogen project during all or any portion of the first 20 years of the project’s operations. (hydrocarbure renouvelable admissible)

    excluded property

    excluded property means property that is 

    • (a) used solely

      • (i) to support a CCUS project, or

      • (ii) for using captured carbon in industrial production (including for enhanced oil recovery);

    • (b) equipment used for the off-site transmission, transportation or distribution of hydrogen or ammonia;

    • (c) equipment used to prepare hydrogen for transport, including liquefaction equipment and equipment used to compress hydrogen to levels suitable for transportation;

    • (d) an automotive vehicle or related refuelling or charging equipment;

    • (e) a building or other structure;

    • (f) construction equipment, furniture or office equipment; or

    • (g) equipment used for off-site storage. (bien exclu)

    expected carbon intensity

    expected carbon intensity means the carbon intensity of hydrogen that is expected to be produced by a particular clean hydrogen project of a taxpayer, as documented in the taxpayer’s clean hydrogen project plan in respect of the project. (intensité carbonique attendue)

    first day of the compliance period

    first day of the compliance period means, in respect of a clean hydrogen project of a taxpayer,

    • (a) unless paragraph (b) or (c) applies, the particular day that is 120 days after the day on which hydrogen is first produced by the project;

    • (b) if the taxpayer files an election in prescribed form and manner with the Minister with its return of income for the taxation year that includes the particular day referred to in paragraph (a), the day that is one year after the particular day; or

    • (c) if the taxpayer has filed an election under paragraph (b) and files a second election in prescribed form and manner with the Minister with its return of income for the taxation year that includes the day referred to in paragraph (b), the day that is two years after the particular day referred to in paragraph (a). (premier jour de la période de conformité)

    Fuel LCA Model

    Fuel LCA Model means the Government of Canada’s Fuel Life Cycle Assessment Model that is published by the Minister of the Environment. (modèle ACV des combustibles)

    government assistance

    government assistance has the same meaning as in subsection 127(9). (aide gouvernementale)

    ineligible use

    ineligible use means

    • (a) the emission of captured carbon into the atmosphere, other than

      • (i) for the purposes of system integrity or safety, or

      • (ii) incidental emission made in the ordinary course of operations;

    • (b) the storage or use of captured carbon for enhanced oil recovery; and

    • (c) any other storage or use that is not

      • (i) the storage of captured carbon in a geological formation located in a jurisdiction within Canada or the United States that has environmental laws and enforcement governing the permanent storage of captured carbon, or

      • (ii) the use of captured carbon in producing concrete in Canada or the United States using a process that mineralizes and permanently stores at least 60% of the captured carbon that is injected into the concrete. (utilisation non admissible)

    input carbon intensity

    input carbon intensity in relation to a fuel, energy source or material input, means the quantity in kilograms of carbon dioxide equivalent per unit of fuel, energy source or material input that is released over the life cycle of that fuel, energy source or material input. (intensité carbonique entrante)

    non-government assistance

    non-government assistance has the same meaning as in subsection 127(9). (aide non gouvernementale)

    non-hydrogen or ammonia use

    non-hydrogen or ammonia use means a use of a particular property at a particular time that would, if the property were acquired at that time, result in the property ceasing to be an eligible clean hydrogen property, determined without reference to paragraph (b) of that definition. (utilisation autre que pour l’hydrogène ou l’ammoniac)

    operating year

    operating year means each cumulative 365-day period, the first of which begins on the first day of the compliance period of a taxpayer’s clean hydrogen project, disregarding any period during which the project is not operating. (année d’exploitation)

    preliminary clean hydrogen work activity

    preliminary clean hydrogen work activity means an activity that is preliminary to the acquisition, construction, fabrication or installation by or on behalf of a taxpayer of eligible clean hydrogen property in respect of the taxpayer’s clean hydrogen project including, but not limited to, a preliminary activity that is

    • (a) obtaining permits or regulatory approvals;

    • (b) performing front-end design or engineering work, including front-end engineering design studies (or equivalent studies as determined by the Minister of Natural Resources) but excluding detailed design or engineering work in relation to eligible clean hydrogen property;

    • (c) conducting feasibility studies or pre-feasibility studies (or equivalent studies as determined by the Minister of Natural Resources);

    • (d) conducting environmental assessments; or

    • (e) clearing or excavating land. (travaux préliminaires pour l’hydrogène propre)

    project support equipment

    project support equipment means equipment that directly supports a qualified clean hydrogen project by

    • (a) transmitting electrical energy from on-site electrical generation equipment directly to the project;

    • (b) distributing electrical energy or heat energy; or

    • (c) delivering, collecting, recovering, treating or recirculating water, or a combination of those activities. (matériel de soutien du projet)

    qualified clean hydrogen project

    qualified clean hydrogen project means a clean hydrogen project of a taxpayer, as described in the taxpayer’s clean hydrogen project plan, where the Minister of Natural Resources has confirmed in writing that

    • (a) the hydrogen will be produced from an eligible pathway;

    • (b) the expected carbon intensity contained in the taxpayer’s most recent clean hydrogen project plan

      • (i) is determined in accordance with subsection (6), and

      • (ii) can reasonably be expected to be achieved based on the project design; and

    • (c) if the project is intended to produce clean ammonia, the taxpayer has demonstrated

      • (i) that the project can reasonably be expected to have sufficient hydrogen production capacity to satisfy the needs of the taxpayer’s ammonia production facility, and

      • (ii) if the taxpayer’s hydrogen production facility and its ammonia production facility are not co-located, the feasibility of transporting hydrogen between the facilities. (projet admissible pour l’hydrogène propre)

    qualified validation firm

    qualified validation firm means, in respect of a clean hydrogen project of a taxpayer, an engineer or engineering firm that

    • (a) is registered and in good standing with a professional association that has the authority or recognition by law of a jurisdiction in Canada to regulate the profession of engineering in

      • (i) the jurisdiction where the project is located, or

      • (ii) if there is no professional association in the jurisdiction described in subparagraph (i), a jurisdiction in Canada where a professional association regulates the profession of engineering;

    • (b) has appropriate insurance coverage;

    • (c) has expertise in modelling using the Fuel LCA Model and engineering expertise in production processes for hydrogen and, if applicable, ammonia;

    • (d) at all times, is independent of, deals at arm’s length with and is not an employee of the taxpayer; and

    • (e) meets the requirements described in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document. (firme admissible de validation)

    qualified verification firm

    qualified verification firm means, in respect of a clean hydrogen project of a taxpayer, an individual or firm that

    • (a) is either

      • (i) an engineer or an engineering firm that is registered and in good standing with a professional association that has the authority or recognition by law of a jurisdiction in Canada to regulate the profession of engineering in

        • (A) the jurisdiction where the project is located, or

        • (B) if there is no professional association in the jurisdiction described in clause (A), a jurisdiction in Canada where a professional association regulates the profession of engineering, or

      • (ii) a verification body accredited and in good standing under the Clean Fuel Regulations;

    • (b) has appropriate insurance coverage;

    • (c) has expertise in life-cycle analysis of greenhouse gas emissions;

    • (d) at all times, is independent of, deals at arm’s length with and is not an employee of the taxpayer;

    • (e) is not a qualified validation firm in respect of the project; and

    • (f) meets the requirements described in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document. (firme admissible de vérification)

    qualifying taxpayer

    qualifying taxpayer means a taxable Canadian corporation. (contribuable admissible)

    specified greenhouse gas

    specified greenhouse gas means

    • (a) carbon dioxide;

    • (b) methane;

    • (c) nitrous oxide;

    • (d) sulphur hexafluoride; and

    • (e) any other greenhouse gases listed in the Fuel LCA Model and included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at the time that a taxpayer files its most recent clean hydrogen project plan with the Minister of Natural Resources. (gaz à effet de serre déterminé)

    specified percentage

    specified percentage means

    • (a) in respect of the capital cost of an eligible clean hydrogen property (other than equipment described in paragraph (b)) that is acquired by a qualifying taxpayer for use in a clean hydrogen project,

      • (i) if the expected carbon intensity of the hydrogen to be produced by the project is less than 0.75 and the property is acquired

        • (A) before 2034, 40%,

        • (B) in 2034, 20%, and

        • (C) after 2034, 0%,

      • (ii) if the expected carbon intensity of the hydrogen to be produced by the project is 0.75 or greater and less than two and the property is acquired

        • (A) before 2034, 25%,

        • (B) in 2034, 12.5%, and

        • (C) after 2034, 0%,

      • (iii) if the expected carbon intensity of the hydrogen to be produced by the project is two or greater and less than four and the property is acquired

        • (A) before 2034, 15%,

        • (B) in 2034, 7.5%, and

        • (C) after 2034, 0%, and

      • (iv) if the expected carbon intensity of the hydrogen to be produced by the project is four or greater, 0%; and

    • (b) in respect of the capital cost of eligible clean hydrogen property that is clean ammonia equipment or equipment described in any of subparagraphs (c)(iv) to (vi) of the definition eligible clean hydrogen property in this subsection that is used solely in connection with clean ammonia equipment acquired by a qualifying taxpayer for use in a clean hydrogen project,

      • (i) subject to subparagraph (ii), if the equipment is acquired

        • (A) before 2034, 15%,

        • (B) in 2034, 7.5%, and

        • (C) after 2034, 0%,

      • (ii) if the expected carbon intensity of the hydrogen to be produced by the project and used in the production of ammonia is four or greater, 0%. (pourcentage déterminé)

  • Marginal note:Clean hydrogen tax credit

    (2) If a qualifying taxpayer files with its return of income for a taxation year a prescribed form containing prescribed information, the taxpayer is deemed to have paid on its balance-due day for the year an amount on account of the taxpayer’s tax payable under this Part for the year equal to the taxpayer’s clean hydrogen tax credit for the year.

  • Marginal note:Deemed deduction

    (3) For the purposes of this section, paragraph 12(1)(t), subsection 13(7.1), variable I of the definition undepreciated capital cost in subsection 13(21), subsection 53(2) and sections 127.49 and 129, the amount deemed under subsection (2) to have been paid by a taxpayer for a taxation year is deemed to have been deducted from the taxpayer’s tax otherwise payable under this Part for the year.

  • Marginal note:Time limit for application

    (4) A payment on account of tax payable shall not be deemed to be paid under subsection (2) if the taxpayer does not file with the Minister the prescribed form containing prescribed information described in subsection (2) in respect of the amount on or before the later of December 31, 2025 and the day that is one year after the taxpayer’s filing-due date for the year and, if the prescribed form is filed after the taxpayer’s filing-due date for the year, no payment by the taxpayer is deemed to arise under that subsection until the prescribed form containing prescribed information has been filed with the Minister.

  • Marginal note:Time of acquisition

    (5) For the purpose of this section, eligible clean hydrogen property is deemed not to have been acquired before the property becomes available for use by the taxpayer, determined without reference to paragraphs 13(27)(c) and (28)(d).

  • Marginal note:Calculation of carbon intensity

    (6) For the purposes of calculating the carbon intensity of hydrogen produced and to be produced by a clean hydrogen project of a taxpayer,

    • (a) the most recent Fuel LCA Model at the time of filing by the taxpayer of the most recent related clean hydrogen project plan with the Minister of Natural Resources shall be used, unless, at the time of filing any compliance report under subsection (16), the taxpayer elects to use a subsequent version of the Fuel LCA Model in calculating the actual carbon intensity of the project;

    • (b) in applying the Fuel LCA Model, an assessment of emissions from the production of hydrogen by the project and upstream emissions from the production of inputs to the hydrogen-production process shall be taken into account;

    • (c) the quantity of hydrogen produced by the project is to be adjusted to take into account any hydrogen that is consumed in the production process;

    • (d) if the taxpayer produces hydrogen from eligible hydrocarbons, any captured carbon that is subject to an ineligible use is deemed not to be captured;

    • (e) if, in connection with the project, the taxpayer generates or purchases, or proposes to generate or purchase, electricity that is

      • (i) generated, or to be generated, by the taxpayer from

        • (A) an eligible electricity generation source, the contribution of the electricity to carbon intensity is to correspond with the input carbon intensity of the technology-specific electricity in the Fuel LCA Model,

        • (B) on-site generation equipment that converts hydrogen, heat recovered from the taxpayer’s hydrogen or ammonia production equipment or eligible hydrocarbons (with carbon dioxide captured using a CCUS process) into electricity that supports the production of hydrogen from eligible hydrocarbons, the contribution of the electricity to carbon intensity is to be modelled as part of the project,

        • (C) a generator used for startup or emergency backup operations, the contribution of the electricity to carbon intensity is to be modelled as part of the project, and

        • (D) a generation source other than as described in any of clauses (A) to (C), the carbon intensity of the project is deemed to be greater than 4.5,

      • (ii) purchased, or to be purchased, pursuant to an eligible power purchase agreement,

        • (A) the contribution of the electricity to carbon intensity is to correspond with the input carbon intensity of the technology-specific electricity in the Fuel LCA Model, and

        • (B) the contribution of the electricity to expected carbon intensity is to be calculated in proportion to the number of years for which the agreement will be in place during the first 20 years of the project’s operations, and

      • (iii) otherwise sourced, or to be sourced, from a provincial grid, the contribution to carbon intensity of the net positive quantity of the electricity (after subtracting any electricity purchased by the taxpayer under an eligible power purchase agreement or generated by the taxpayer in respect of the project that is, in either case, transmitted to the grid by the taxpayer) is to be based on the input carbon intensity of the provincial grid in the Fuel LCA Model;

    • (f) in calculating the quantity of electricity described in paragraph (e), if the sum of the quantities of electricity from sources described in subparagraphs (e)(i) and (ii) exceeds the total electricity consumed or to be consumed by the project, then the electricity consumed or to be consumed by the project is deemed to be generated

      • (i) first, from the source described in subparagraph (e)(i), and

      • (ii) second, from the source described in subparagraph (e)(ii) to the extent of any excess;

    • (g) if the project uses, or proposes to use, eligible hydrocarbons for the purpose of producing hydrogen,

      • (i) where the eligible hydrocarbon is an eligible renewable hydrocarbon in respect of the taxpayer,

        • (A) the contribution of that eligible renewable hydrocarbon to carbon intensity is to be based on the most recent CFR carbon intensity that is determined under the Clean Fuel Regulations, adjusted as necessary, and

        • (B) the contribution of that eligible renewable hydrocarbon to expected carbon intensity is to be calculated in proportion to the number of years for which that hydrocarbon will be used during the first 20 years of the project’s operations, and

      • (ii) in any other case, the input carbon intensity of the relevant eligible hydrocarbon is to be taken into account in applying the Fuel LCA Model;

    • (h) if the taxpayer disposes of any environmental attributes associated with any electricity described in subparagraph (e)(i) or (ii) or any eligible renewable hydrocarbon described in subparagraph (g)(i), the carbon intensity of the project is deemed to be greater than 4.5; and

    • (i) the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at the time of filing by the taxpayer of the most recent related clean hydrogen project plan with the Minister of Natural Resources, is to apply conclusively with respect to the calculation of carbon intensity, except as otherwise provided in this section.

  • Marginal note:Changes to clean hydrogen project

    (7) Subsection (8) applies in respect of a qualified clean hydrogen project of a taxpayer if, before the first day of the compliance period of the project,

    • (a) the Minister of Natural Resources determines that there has been a material change to the project design and requests that the taxpayer file a revised project plan for the project;

    • (b) the taxpayer

      • (i) does not file the final detailed engineering designs with the Minister of Natural Resources in accordance with paragraph (9)(d),

      • (ii) changes the project’s eligible pathway, or

      • (iii) reasonably expects that there will be an increase (as compared to the most recent project plan for the project) of more than 0.5 kilograms of carbon dioxide equivalent per kilogram of hydrogen to be produced by the project;

    • (c) any eligible power purchase agreement referenced in the most recent clean hydrogen project plan of the taxpayer

      • (i) has not been finalized and executed so as to become legally binding, or

      • (ii) has been materially modified or terminated; or

    • (d) any environmental attributes associated with the agreement have been disposed of by the taxpayer.

  • Marginal note:Rules relating to revised project plan

    (8) If this subsection applies,

    • (a) the taxpayer shall file, within 180 days, a revised clean hydrogen project plan in respect of the project with the Minister of Natural Resources, in the form and manner determined by the Minister of Natural Resources;

    • (b) if the Minister of Natural Resources is satisfied that the project will meet the requirements in paragraphs (a) to (c) of the definition qualified clean hydrogen project,

      • (i) the Minister of Natural Resources shall confirm, with all due dispatch, the revised plan,

      • (ii) the taxpayer’s clean hydrogen tax credit shall be redetermined, as of the date of the filing of the revised plan, based on the expected carbon intensity set out in the revised plan, and

      • (iii) if the taxpayer previously deducted an amount in respect of a clean hydrogen tax credit, subsection (18) applies as if the compliance period ended on that date and the average actual carbon intensity of the project was equal to the expected carbon intensity set out in the revised plan;

    • (c) if the Minister of Natural Resources is not satisfied in accordance with paragraph (b) and does not issue a confirmation described in subparagraph (b)(i) within one year after the filing of the taxpayer’s revised plan, then, as of the expiry of that period,

      • (i) the project is deemed not to be a qualified clean hydrogen project,

      • (ii) the average actual carbon intensity of the project is deemed to be greater than 4.5, and

      • (iii) subsection (18) applies as if the compliance period of the project ended on the expiry date of that period; and

    • (d) if the taxpayer fails to file a revised clean hydrogen project plan in accordance with paragraph (a), then, as of the expiry of the 180-day period described in paragraph (a),

      • (i) subject to subparagraph (ii),

        • (A) the project is deemed not to be a qualified clean hydrogen project,

        • (B) the average actual carbon intensity of the project is deemed to be greater than 4.5, and

        • (C) subsection (18) applies as if the compliance period of the project ended on the expiry date of that period, and

      • (ii) once the taxpayer has filed the revised clean hydrogen project plan, subparagraph (i) is deemed never to have applied.

  • Marginal note:Clean hydrogen project determination and rules

    (9) For the purposes of this section,

    • (a) the Minister may, in consultation with the Minister of Natural Resources, determine that one or more clean hydrogen projects is one project or multiple projects

      • (i) at any time before the Minister of Natural Resources confirms the expected carbon intensity of the hydrogen to be produced by a clean hydrogen project, or

      • (ii) if a taxpayer files or is required to file a revised clean hydrogen project plan in accordance with subsection (8), at any time before the Minister of Natural Resources confirms the revised plan;

    • (b) any determination under paragraph (a) is deemed to result in the clean hydrogen project or clean hydrogen projects, as the case may be, being one project or multiple projects, as the case may be;

    • (c) for each project determined under paragraph (a), a taxpayer shall file a separate clean hydrogen project plan with the Minister of Natural Resources (in the form and manner determined by the Minister of Natural Resources) on or before the day that is 180 days after the determination is made;

    • (d) in respect of each clean hydrogen project, the taxpayer shall file final detailed engineering designs with the Minister of Natural Resources by the earlier of the day on which hydrogen is first produced by the project and the day that is 60 days after the final detailed engineering designs are prepared; and

    • (e) the Minister of Natural Resources may request from the taxpayer all documentation and information necessary for the Minister of Natural Resources to fulfill a responsibility under this section and may refuse to confirm the taxpayer’s clean hydrogen project plan or revised clean hydrogen project plan if such documentation or information is not provided by the taxpayer on or before the day that is 180 days after it was requested.

  • Marginal note:Capital cost of clean hydrogen property

    (10) For the purposes of this section, the capital cost of eligible clean hydrogen property to a taxpayer shall

    • (a) not include any amount in respect of a capital property

      • (i) for which an amount was previously deducted under this section by any person,

      • (ii) in respect of which a CTM investment tax credit (as defined in subsection 127.49(1)) was deducted by any person, or

      • (iii) that has, by virtue of section 21, been added to the cost of a property;

    • (b) be determined without reference to subsections 13(7.1) and (7.4);

    • (c) be reduced by the total of all amounts, each of which can reasonably be considered to be in respect of the property and is

      • (i) an amount of any government assistance or non-government assistance received by the taxpayer in or before the taxation year in which the property was acquired, or

      • (ii) an amount not described in subparagraph (i) that, in the taxation year, the taxpayer is entitled to or can reasonably be expected to receive and that would be government assistance or non-government assistance if it were received by the taxpayer in the year;

    • (d) be determined with reference to subsections 127(11.6) to (11.8) in respect of an expenditure or cost to a taxpayer except that

      • (i) the reference in subsection 127(11.6) to subsection 127(11.5) is to be read as a reference to section 127.48,

      • (ii) the reference in subsection 127(11.6) to subsection 127(26) is to be read as a reference to subsection 127.48(13), and

      • (iii) the term “qualified expenditure” is to be read as an expenditure eligible to be added to the capital cost of an eligible clean hydrogen property;

    • (e) not include any amount in respect of an expenditure incurred for a preliminary clean hydrogen work activity;

    • (f) if the property is dual-use electricity and heat equipment, project support equipment or equipment described in any of subparagraphs (c)(iv) to (vi) of the definition eligible clean hydrogen property in subsection (1), excluding equipment used all or substantially all to support a qualified clean hydrogen project, be equal to the proportion of the capital cost of the equipment that

      • (i) if the equipment is described in paragraph (a) of the definition dual-use electricity and heat equipment in subsection (1), the quantity of energy expected to be produced for use in the project over the first 20 years of the project’s operations is of the total quantity of energy expected to be produced by the equipment in that period (determined without regard to energy produced and consumed by the equipment in the process of producing energy), based on the project’s most recent clean hydrogen project plan,

      • (ii) if the equipment is described in paragraph (b) of the definition dual-use electricity and heat equipment in subsection (1) or paragraph (a) of the definition project support equipment in subsection (1), the quantity of electrical energy expected to be transmitted by the equipment for use in the project over the first 20 years of the project’s operations is of the total quantity of electrical energy expected to be transmitted by the equipment in that period (determined without regard to electrical energy consumed by the equipment in the process of transmission), based on the project’s most recent clean hydrogen project plan,

      • (iii) if the equipment is described in paragraph (b) of the definition project support equipment in subsection (1), the quantity of electrical or heat energy expected to be distributed by the equipment (or if it is equipment that expands the capacity of existing equipment, the electrical or heat energy expected to be distributed by the existing and new equipment) for use in the project over the first 20 years of the project’s operations is of the total quantity of electrical or heat energy expected to be distributed by the equipment (or the existing and new equipment) in that period (determined without regard to energy consumed by the equipment in the process of distribution), based on the project’s most recent clean hydrogen project plan,

      • (iv) if the equipment is described in paragraph (c) of the definition project support equipment in subsection (1), the mass of water expected to be supplied to the project over the first 20 years of the project’s operations is of the total mass of water expected to be processed by the equipment in that period, based on the project’s most recent clean hydrogen project plan, and

      • (v) if the equipment is described in any of subparagraphs (c)(iv) to (vi) of the definition eligible clean hydrogen property in subsection (1) and supports equipment described in any of subparagraphs (i) to (iv), is determined under that subparagraph; and

    • (g) after applying paragraph (f), if the property is dual-use hydrogen and ammonia equipment, dual-use electricity and heat equipment, project support equipment or equipment described in any of subparagraphs (c)(iv) to (vi) of the definition eligible clean hydrogen property in subsection (1) and that property is used in the production of hydrogen and ammonia, be allocated between two separate capital cost amounts, with each amount determined based on the percentage of the expected use of the equipment that is attributable to hydrogen production and ammonia production and

      • (i) the capital cost amount that is attributable to hydrogen production is deemed to be in respect of property described in paragraph (a) of the definition specified percentage in subsection (1), and

      • (ii) the capital cost amount that is attributable to ammonia production is deemed to be in respect of property described in paragraph (b) of the definition specified percentage in subsection (1).

  • Marginal note:Repayment of assistance

    (11) Where a taxpayer has, in a particular taxation year, repaid (or has not received and can no longer reasonably be expected to receive) an amount of government assistance or non-government assistance that was applied to reduce the capital cost of an eligible clean hydrogen property under paragraph (10)(c) for a preceding taxation year, the amount repaid (or no longer expected to be received) is to be added to the cost to the taxpayer of a property acquired in the particular year for the purpose of determining the taxpayer’s clean hydrogen tax credit for the year.

  • Marginal note:Partnerships

    (12) Subject to section 127.491, where, in a particular taxation year of a qualifying taxpayer who is a member of a partnership, an amount would be determined under subsection (2) in respect of the partnership, for its taxation year that ends in the particular year, if the partnership were a taxable Canadian corporation and its fiscal period were its taxation year, the portion of that amount that can reasonably be considered to be the taxpayer’s share thereof shall be added in computing the clean hydrogen tax credit of the taxpayer at the end of the particular year.

  • Marginal note:Unpaid amounts

    (13) For the purposes of this section, where any part of the capital cost of a taxpayer’s eligible clean hydrogen property is unpaid on the day that is 180 days after the end of the taxation year in which a deduction in respect of a clean hydrogen tax credit would otherwise be available in respect of the property, such amount is to be

    • (a) excluded from the capital cost of the property in the year; and

    • (b) added to the capital cost of the property at the time it is paid.

  • Marginal note:Tax shelter investment

    (14) Subsection (2) does not apply if an eligible clean hydrogen property – or an interest in a person or partnership that has, directly or indirectly, an interest in, or for civil law, a right in, such property – is a tax shelter investment for the purpose of section 143.2.

  • Marginal note:Annual information reporting requirement

    (15) If a clean hydrogen tax credit was deducted in any taxation year by a taxpayer in respect of a qualified clean hydrogen project, the taxpayer shall file, with its return of income for each taxation year that begins during the compliance period in respect of the project, a prescribed form containing prescribed information in respect of the operations of the project.

  • Marginal note:Compliance — annual carbon intensity reporting

    (16) If a clean hydrogen tax credit was deducted by a taxpayer in respect of a qualified clean hydrogen project, the taxpayer shall file with the Minister and the Minister of Natural Resources, within 180 days after the end of each operating year, a compliance report in prescribed form and manner including

    • (a) the actual carbon intensity of the hydrogen produced by the project during the year;

    • (b) the quantity, in kilograms, of hydrogen that is produced by the project during the year;

    • (c) any shutdown time of the project in respect of the year;

    • (d) for the compliance report in respect of the fifth operating year, a report that verifies the actual carbon intensity of the hydrogen produced during each operating year of the compliance period, prepared by a qualified verification firm in respect of the project; and

    • (e) any information required in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document.

  • Marginal note:Failure to report

    (17) Each taxpayer that fails to file a compliance report for a project as described in subsection (16) is liable to a penalty, for each such failure, in an amount, not exceeding the total of all clean hydrogen tax credits deducted by the taxpayer in respect of the project, equal to the amount determined by the formula

    ((4% × A) ÷ 365) × B

    where

    A

    is the total of all amounts, each of which is the amount of a clean hydrogen tax credit in respect of the project deducted by the taxpayer for a taxation year that ended before the applicable date in subsection (16); and

    B

    is the number of days during which the failure continues.

  • Marginal note:Recovery — change in carbon intensity

    (18) In the taxation year of a taxpayer in which the compliance period of the taxpayer’s qualified clean hydrogen project ends, if the average actual carbon intensity of the hydrogen produced is greater than the most recent expected carbon intensity that was used to determine a clean hydrogen tax credit in respect of the project, there shall be added to the taxpayer’s tax otherwise payable under this Part for the taxation year an amount equal to the total of all amounts, each of which is determined by the formula

    (A − B) × C

    where

    A

    is the specified percentage that was applied to the capital cost of the eligible clean hydrogen property forming part of the project in determining a clean hydrogen tax credit of the taxpayer;

    B

    is the specified percentage that would have applied to the capital cost of the property if the expected carbon intensity were equal to the average actual carbon intensity of the project; and

    C

    is the capital cost of the property on which the clean hydrogen tax credit was deducted.

  • Marginal note:Minister’s determination

    (19) For the purpose of subsection (18), the Minister of Natural Resources shall review each of the taxpayer’s compliance reports described in subsection (16) and the Minister may, in consultation with the Minister of Natural Resources, make a determination or redetermination of the actual carbon intensity of the hydrogen produced by a taxpayer’s clean hydrogen project for any operating year during the compliance period of the project.

  • Marginal note:De minimis exception

    (20) Subsection (18) does not apply to a taxpayer if the difference between the average actual carbon intensity of the taxpayer’s qualified clean hydrogen project and the expected carbon intensity of the project is 0.5 or less.

  • Marginal note:Recapture of clean hydrogen tax credit — application

    (21) Subsection (22) applies in a taxation year if

    • (a) a taxpayer acquired an eligible clean hydrogen property in the year or any of the preceding 20 calendar years;

    • (b) the taxpayer became entitled to a clean hydrogen tax credit in respect of the capital cost, or a portion of the capital cost, of the property; and

    • (c) in the year, the property is converted to a non-hydrogen or ammonia use, is exported from Canada or is disposed of without having been previously exported or converted to a non-hydrogen or ammonia use.

  • Marginal note:Recapture of clean hydrogen tax credit

    (22) If this subsection applies for a taxation year in respect of an eligible clean hydrogen property, there shall be added to the taxpayer’s tax otherwise payable under this Part for the year an amount determined by the formula

    (A – B) × (C ÷ D)

    where

    A

    is the amount of the taxpayer’s clean hydrogen tax credit in respect of the property;

    B

    is the total of all amounts, each of which can reasonably be considered to be the portion of any amount previously paid by the taxpayer because of subsection (18) in respect of the property;

    C

    is an amount, not exceeding the amount determined for D, equal to

    • (a) if the property is disposed of to a person or partnership who deals at arm’s length with the taxpayer, the proceeds of disposition of the property, and

    • (b) in any other case, the fair market value of the property; and

    D

    is the capital cost of the property on which the clean hydrogen tax credit was deducted.

  • Marginal note:Election — sale of clean hydrogen project

    (23) If at any time a qualifying taxpayer (referred to in this subsection as the “vendor”) disposes of all or substantially all of its property comprising a qualified clean hydrogen project of the taxpayer to another taxable Canadian corporation (referred to in this subsection as the “purchaser”), and the vendor and the purchaser jointly elect in prescribed form, on or before the day that is the earliest of the days on or before which any taxpayer making the election is required to file a return of income pursuant to section 150 for the taxation year in which the transaction occurred, to have this subsection apply, the following rules apply:

    • (a) the purchaser is deemed to have acquired any eligible clean hydrogen property of the vendor at the times acquired by the vendor;

    • (b) the provisions of this Act that applied to the vendor in respect of the property that are relevant to the application of the Act in respect of the property after that time are deemed to have applied to the purchaser and, for greater certainty, the purchaser is deemed to have claimed the clean hydrogen tax credits determined under subsection (2) that could have been claimed by the vendor, before that time, in respect of the project;

    • (c) any clean hydrogen project plans that were filed by the vendor in respect of the project before that time are deemed to have been filed by the purchaser;

    • (d) the purchaser is or will be liable for amounts in respect of the property for which the vendor would be liable under this section in respect of actions, transactions or events that occur after that time as if the vendor had undertaken them or otherwise participated in them; and

    • (e) subsection (22) does not apply to the vendor in respect of the disposition of property to the purchaser.

  • Marginal note:Recapture event reporting requirement

    (24) If subsection (22) applies to a taxpayer or partnership for a particular year, the taxpayer or partnership, as the case may be, shall notify the Minister in prescribed form and manner on or before the taxpayer’s filing-due date for the year or the day when a return is required by section 229 of the Income Tax Regulations to be filed in respect of the fiscal period of the partnership.

  • Marginal note:Recovery and recapture — partnerships

    (25) If subsection (12) has at any time applied to add an amount in computing the clean hydrogen tax credit of a member of a partnership, subsections (18) to (23) apply to determine amounts in respect of the partnership as if the partnership was a taxable Canadian corporation, its fiscal period were its taxation year and it had deducted all of the clean hydrogen tax credits that were previously added in computing the clean hydrogen tax credit of any member of the partnership because of the application of subsection (12) in respect of its partnership interest.

  • Marginal note:Member’s share of recovery or recapture

    (26) Unless subsection (27) applies, if, in a taxation year, a taxpayer is a member of a partnership, the amount that can reasonably be considered to be the taxpayer’s share of any amount of tax determined because of subsection (25) in respect of the partnership shall be added to the taxpayer’s tax otherwise payable under this Part for the year.

  • Marginal note:Election by member

    (27) A taxable Canadian corporation that is a member of a partnership during a fiscal period of the partnership may elect, in prescribed form and manner, to add to its tax payable under this Part for its taxation year that includes the end of the fiscal period the total amount of tax determined for a taxation year because of subsection (25) in respect of the partnership.

  • Marginal note:Joint, several and solidary liability

    (28) Each member of a partnership is jointly and severally, or solidarily, liable for any portion of the amount of tax – determined because of subsection (25) in respect of the partnership for a taxation year – that is not added to the tax payable

    • (a) of a member of the partnership under subsection (26); or

    • (b) of a taxable Canadian corporation because of subsection (27) and paid by the corporation by its filing-due date for the year.

  • Marginal note:Interest on recovery tax

    (29) For the purpose of applying subsection 161(1) to an amount of tax payable because of subsection (18) (other than an amount payable because of subsection (8)), the balance-due day of a taxpayer is deemed to be the balance-due day of the taxation year for the related clean hydrogen tax credit under subsection (2).

  • Marginal note:Credit after compliance period

    (30) For the purpose of applying subsection (2) in respect of a property acquired after the compliance period of a qualified clean hydrogen project of the taxpayer, the expected carbon intensity of the project is deemed to be the greater of the expected carbon intensity otherwise determined and the average actual carbon intensity for the compliance period of the project.

  • Marginal note:Purpose

    (31) The purpose of this section is to encourage the investment of capital in the production of clean hydrogen and clean ammonia in Canada.

  • Marginal note:Authority of the Minister of Natural Resources

    (32) For the purpose of determining whether a property is an eligible clean hydrogen property, the Clean Hydrogen Investment Tax Credit – Technical and Equipment Guidance Document published by the Department of Natural Resources is to apply conclusively with respect to engineering and scientific matters.

• (2) Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023, except that before January 1, 2024, subsection 127.48(3) of the Act (as enacted by subsection (1)) is to be read without reference to section 127.49 and subsection 127.48(10) of the Act (as enacted by subsection (1)) is to be read without reference to its subparagraph (a)(ii).