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Canada: Clean technology investment tax credit for small nuclear energy property (Income Tax Act s. 127.45)

Section 127.45 of Canada's Income Tax Act defines small nuclear energy property (facilities expected to total no more than 1,400 MWth) as clean technology property and sets specified percentages of 30% for property acquired from 28 March 2023 through 2033, 15% in 2034 and nil after. These percentages do not establish any taxpayer's eligibility or actual credit. It is a federal tax measure, not a licence, site decision or project award.

Category
Laws, rules and executive directives
Status
In effect
Instrument
statute · Income Tax Act, s. 127.45, added by S.C. 2024, c. 15, s. 36 (assented to 20 June 2024) and amended by S.C. 2024, c. 17, s. 80 and S.C. 2026, c. 3, s. 52 (assented to 26 March 2026)
Issued by
Parliament of Canada
Jurisdiction
Canada
Affects
Project funding
Effective date
Not recorded
Expiry or completion
None recorded
Operative text
Canada: Income Tax Act s. 127.45 (clean technology investment tax credit), consolidated text (Consolidated Income Tax Act s. 127.45, current to 2026-09-21, last amended 2026-06-18)
Last checked · next review
2026-10-08 · 2026-12-08

Legal and geographic scope

Federal investment tax credit: paragraph (a) of the definition of a qualifying taxpayer's clean technology investment tax credit for a taxation year is the total of all amounts each of which is the specified percentage of the capital cost to the taxpayer of clean technology property acquired in the year, and clean technology property includes small nuclear energy property. The consolidated text current to 21 September 2026 sets the specified percentage at nil for property acquired before 28 March 2023, 30% for property acquired on or after 28 March 2023 and before 1 January 2034, 15% for property acquired in 2034 and nil after 2034. Small nuclear energy property is listed equipment of a fixed-location system used all or substantially all to generate electricity or heat from nuclear fission, as determined on an annual basis, at a nuclear facility where the total combined gross-rated thermal generating capacity of all planned and existing fission reactors is reasonably expected not to exceed 1,400 MWth when the property becomes available for use; nuclear fuel, waste storage or disposal property, transmission and distribution equipment and vehicles are excluded. As enacted in 2024 the section instead defined a small modular nuclear reactor by a system gross rated generating capacity of not more than 300 MWe (or an energy-balance equivalent of 1,000 MWth) built from factory-assembled modules; S.C. 2026, c. 3, s. 52(1) repealed that definition, and s. 52(18) deems subsections 52(1) to (3), among others, to have come into force on 28 March 2023. The 28 March 2023 date is therefore an acquisition date for the credit and the deemed commencement of those subsections, not the date the section was enacted (20 June 2024). The credit does not license, site or select any reactor or project.

Not approved or still pending

No taxpayer's or project's eligibility, claim or receipt of the credit is established here. The lifecycle is selective: the S.C. 2024, c. 17, s. 80 amendment was not opened, and labour requirements, recapture rules and application provisions (not included in the consolidated text) were not assessed.

Dated lifecycle

Definitions in this instrument

Projects or designs named by the source

Sources