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Clean Technology Manufacturing ITC: What Canadian Businesses Need to Know

New refundable tax credits are now in law for clean technology, including clean manufacturing and critical mineral processing—here’s how to capitalize.

By NomadicTax Research Team • 5-8 min read • June 17, 2026

## What the CTM ITC is The **Clean Technology Manufacturing Investment Tax Credit (CTM ITC)** is a **refundable** federal tax credit designed to incentivize clean tech manufacturing, processing, and critical mineral extraction in Canada. It covers capital investments in eligible machinery, equipment, and facilities. The CTM ITC is effective **retroactively starting January 1, 2024**, and runs through December 31, 2034. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/business-tax-credits/clean-economy-itc/clean-technology-manufacturing-itc.html?utm_source=openai)) **Refundable** means the credit can reduce a corporate tax liability *below zero* — important for newer businesses or those with losses. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/business-tax-credits/clean-economy-itc/clean-technology-manufacturing-itc.html?utm_source=openai)) ## Eligibility & What Qualifies To qualify, Canadian corporations must invest in eligible clean-technology manufacturing or processing property. These include: - Manufacturing equipment and facilities that use clean energy or reduce emissions - Critical mineral extraction or processing projects (e.g., for battery minerals) - Processing operations that elevate raw materials into clean-tech-ready intermediates will typically be eligible. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/business-tax-credits/clean-economy-itc/clean-technology-manufacturing-itc.html?utm_source=openai)) ## Strategic action steps for businesses 1. **Review your capital projects** planned from Jan 2024 onward — even ones started in previous years may now be eligible retroactively. 2. **Ensure documentation is thorough**, including asset acquisition cost, installation date, function, and usage proportion for qualified purpose. 3. **Align with tax planning timelines** — account for when credits can offset tax payable or generate refunds. 4. **Consult with professional advisors** or the CRA’s guidance to navigate eligibility and how to claim CTM ITC on corporate returns. ## Example scenario ABC Corp, a manufacturer in Ontario, purchases qualifying machinery worth CAD 1 million in mid-2025. The machinery is used to process critical minerals. It falls under the CTM ITC regime retroactive from Jan 1, 2024. Since the credit is refundable, ABC Corp can apply the credit even if taxable income is low, potentially generating a tax refund rather than just lowering tax owing. Be sure to file with the correct ITC schedules and include investment details. ## Key considerations - Be careful of “use” versus “availability” — eligible property must be used for the intended clean-technology purpose. - Provincial credits may interact; in some provinces temporary manufacturing & processing investment tax credits (e.g., B.C.) are also available. ([canada.ca](https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/corporations/whats-new-corporations.html?utm_source=openai)) - Audit risk increases for large claims; proper valuation and classification are essential.