Skilled trades employers can deduct up to $5,000 per apprentice through the OATTC.
Q: For more than 15 years, I was a licensed mechanic for a large Canadian auto maintenance retailer. Recently, I opened my own mechanic shop, specializing in German made automobiles. Recently, I was introduced to an electrician whose company offers an apprenticeship program and receives assistance from the Government. Can I receive similar assistance in my industry from the government?
— Sal, Vaughan
A: Skilled trades are forever in demand and continue to experience a shortage. Our federal government has acknowledged, “They are crucial for the economic future of Canada.” Statistics Canada estimates there are over 1.5 million workers between the ages of 15 and 34 years old. Many are in low wage jobs. They need to be encouraged to consider skilled positions that offer higher pay.
Within the next 10 years it is expected that Ontario will have 26 per cent of its skilled workers approaching retirement.
Businesses need the support to hire and train these young people in order to be competitive and prosperous for future success. As an incentive for many employers to hire and train skilled trades, the Ontario government introduced the (ATTC) “Ontario Apprenticeship Training Tax Credit.” Ontario employers may claim a refundable tax credit for salaries and wages paid to an apprentice in specific industries and trades after May 18, 2004 (ends in 2011). The maximum amount that can be claimed per apprentice is $5,000 per year. Not too shabby an amount, particularly for start-up small businesses. Additionally, the federal government has introduced a comparable program. (Businesses should look into Mr. Harper’s program and new apprentices should apply for the $1,000 grant and tools deduction from federal government.)
The Ontario apprenticeship program includes trades such as transmission technicians, network cabling specialist, cement finishers, electricians, plumbers, tool and die makers. As there are more than 130 skill trades in Ontario, employers can check if they may qualify at: www.edu.gov.on.ca/eng/general/postsec/openingdoors/apt/occfact.htmlor contact your local Ministry of Training, Colleges and Universities Apprenticeship office.
Here are some of the obligations, as an employer must satisfy:
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Provide a qualified mentor or trainer.
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Train apprentice and monitor progress.
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Review with apprentice the trade-specific training standards.
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Make allowance for apprentice to attend in-class training portion of program.
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Encourage and support apprentice to prepare for writing certification examination
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Pay a fair and equitable wage.
Although, businesses benefit from the tax credit, many young workers due to financial barriers have gained access to skill trades that they were previously locked out. The competition has changed and our world is much smaller than it ever was. Ontario and Canada must meet the challenges of the 21st century, let’s hope Ontario continues the program beyond 2011.
Henry Choo Chong, CGA provides professional accounting and taxation solutions for individuals, businesses and corporations. Henry can be reached at 416-590-1728, ext. 304. E-mail all questions to Money Matters choochonghcga@yahoo.ca.
