Apprenticeship and Training Tax Credits for Canadian Employers

Hiring apprentices helps your business build skills and fill labour gaps. But apprentice wages and training time can be expensive. That’s why federal and provincial governments offer apprenticeship and training tax credits for Canadian employers. Some credits are aimed at specific industries, like shipbuilding and ship repair in B.C. If you employ apprentices, these credits can return thousands of dollars through your tax return.

How Apprenticeship and Training Tax Credits Work

Apprenticeship tax credits lower the cost of hiring registered apprentices. Most credits are claimed when you file your corporate or personal income tax return. Some credits are refundable, so you could get money back even if you owe little or no tax.

These credits support employers in many sectors, including construction, manufacturing, and marine industries. Each province has its own programs and requirements, so it’s important to review what’s available in your area. Below are three programs that Canadian employers use often, with a focus on British Columbia and Ontario.

BC Shipbuilding and Ship Repair Industry Tax Credit

The BC Shipbuilding and Ship Repair Industry Tax Credit helps employers whose main business is building, repairing, or converting ships in B.C.

Key eligibility requirements

Your main business must be ship construction, repair, or conversion.
You must employ apprentices who are:
- Registered with SkilledTradesBC
- Enrolled in eligible Red Seal or non–Red Seal apprenticeship programs
Eligible ships must be sea-going vessels with engines.
Boats and yachts for personal or recreational use do not qualify.

Partnerships can also claim this credit. Each eligible partner claims their share. Businesses focused on recreational boat or yacht work are not eligible.

What costs are covered

Salaries and wages paid to eligible apprentices during qualifying apprenticeship periods.

This credit is valuable for shipyards and marine repair businesses that need skilled workers.

BC Training Tax Credit (Employers)

The BC Training Tax Credit (Employers) supports businesses in many skilled trades, not just shipbuilding.

Who can apply

Sole proprietors, partnerships, and corporations.
Must be subject to B.C. income tax (resident in B.C. or have a permanent establishment in B.C.).
Must employ apprentices:
- Working in a business carried on in B.C.
- Registered in apprenticeship programs run by SkilledTradesBC.

Corporations that are exempt from income tax under section 27 of the Income Tax Act cannot apply. Active partners may claim their share, but limited partners cannot.

What the credit covers

Wages paid to apprentices during certain apprenticeship levels.
Applies to both Red Seal and non–Red Seal programs.

This is one of the most widely used apprenticeship and training tax credits for Canadian employers in B.C.

Ontario Co‑operative Education Tax Credit

The Ontario Co‑operative Education Tax Credit is not an apprenticeship credit, but employers often compare it to apprenticeship incentives.

Program highlights

Available to corporations and unincorporated businesses with a permanent establishment in Ontario.
The student must be enrolled in an eligible post-secondary co-op program.
Work placements must last at least 10 straight weeks.

This credit is refundable and helps cover wages paid to co‑op students.

How to Claim Apprenticeship and Training Tax Credits

Most apprenticeship credits use a similar process:

Register your apprentice with the right authority (for example, SkilledTradesBC).
Track eligible wages by apprenticeship level and period.
Keep payroll records and proof of registration.
Claim the credit when you file your corporate or personal income tax return.

GrantHub’s eligibility matcher can help you find programs by province and industry, which is useful if you operate in more than one location.

Common Mistakes to Avoid

Hiring unregistered apprentices
Apprentices must be formally registered with the provincial authority. Informal trainees do not qualify.
Claiming ineligible work periods
Only wages paid during defined apprenticeship levels or periods count.
Missing industry restrictions
For the BC Shipbuilding and Ship Repair Industry Tax Credit, recreational boat and yacht work is excluded.
Poor record-keeping
Missing payroll or registration documents can delay or deny your claim during a review.

Frequently Asked Questions

Q: Are apprenticeship tax credits refundable?
Some apprenticeship tax credits are refundable. For example, the BC Training Tax Credit for employers is partly refundable, depending on the apprentice’s level and your business type. Always check the current program rules to confirm refundability.

Q: Can partnerships claim apprenticeship tax credits?
Yes. Partnerships can claim certain credits, including the BC Shipbuilding and Ship Repair Industry Tax Credit. Each eligible partner claims their share.

Q: Do non–Red Seal apprentices qualify?
Yes. Both the BC Shipbuilding and Ship Repair Industry Tax Credit and the BC Training Tax Credit cover eligible Red Seal and non–Red Seal programs.

Q: Can I claim more than one training credit for the same apprentice?
Sometimes, but not for the same wages. You cannot claim overlapping credits for the same expense.

Q: When do I receive the benefit of the tax credit?
You get the benefit when you file your income tax return and the credit is assessed. This can reduce your taxes or give you a refund.

Next Steps

Apprenticeship and training tax credits can lower your labour costs and help you train the workers your business needs. They are especially useful in skilled trades and marine industries. If you’re exploring incentives in other provinces or sectors, GrantHub tracks hundreds of grant and tax credit programs across Canada so you can see which ones fit your business, location, and hiring plans.

Apprenticeship and Training Tax Credits for Canadian Employers