The Complete Guide to Ontario Government Business Grants for Entrepreneurs

You may have heard that to support businesses in Ontario, the Government of Canada has a lot of programs available, but did you know that the provincial government has business grants that you can also apply for as well?

We have put together an in-depth list of the ministries and agencies in Ontario that are providing grants and other funding incentives for businesses to help you. There are a few incentives that are provided by each orOntarioganization.

So, let’s get started.

New Government of Ontario Business Incentives in 2021

Ontario Grassroots Growth Program

If your business is working on a project that is going to support the growth of the agri-food sector in Ontario to ensure the sustainability of agriculture, the Grassroots Growth Program can provide funding for these short-term projects. Preference will be given to projects where the business will be sharing the costs of the project, but the program can cover all of the eligible costs of the project.

Agricultural Credit Corporation (ACC) and Government of Ontario, Ministry of Agriculture, Food and Rural Affairs (OMAFRA) – Commodity Loan Program

This loan program was developed to help farmers to finance the expenses for their crop planting, cultivating, and harvesting in Ontario. The program provides access to financing at a lower cost to help supplement cash flow throughout the year for eligible applicants while paying less in interest. The terms for repayment can be up to 22 months.

Rural Economic Development (RED) Program

The RED program has been made to provide cost-share funding for non-profit organizations to help support activities that are creating a strong rural community in Ontario, which can open the door to increase the economic development in these rural areas. The program has two streams, The Economic Diversification stream, and Competitiveness Stream which provides funding assistance for projects that are made to remove the barriers to job and business growth, attract or retain a skilled workforce or strengthen regional and sector partnerships, attract investment, and diversify the regional economies. The Strategic Economic Infrastructure Stream has been designed to support minor capital projects that will advance the opportunities for economic investment and development.

Government of Ontario, Ministry of Agriculture, Food, and Rural Affairs and Agricorp – Ontario Beef Cattle Financial Protection Program

All beef cattle dealers have a license to do business from the ministry. All producers of beef cattle must sell their animals to a licensed dealer and pay a check-off fee for every sale, the fees are then deposited into a fund. When a beef dealer defaults on a payment, this program provides financial protection to the beef cattle seller.

Ontario Ministry of Finance – Tax Refund for a Power Take Off – Gasoline Used in Unlicensed Business Equipment

You may be eligible to receive a refund for any gasoline tax that you pay if you or your business purchases gasoline for any unlicensed equipment, such as equipment that is used for construction, farming, or manufacturing. To qualify the gasoline must be used for industrial, business, or institutional purposes in Ontario, you have paid tax to Ontario on any gas that you have used, the equipment is not used for pleasure or recreation, the equipment is not licensed or required to be licensed under the Highway Traffic Act, and you need to keep all records of the gasoline used to support any claims for a refund.

Ontario Ministry of Finance – Tax Refund for a Power Take Off

Businesses that paid tax on fuel that is used within Ontario in order to operate auxiliary power take off equipment can receive a refund from the Government of Ontario. A power take off operation is classified as a piece of auxiliary equipment that is added to a licensed motor vehicle that uses gasoline, clear diesel fuel, or propane from its fuel tank to operate power take off equipment.

Government of Ontario, Ministry of Finance – Small Beer Manufacturers’ Tax Credit

All beer that is made in Ontario by manufacturers are imposed with a beer tax on purchases in Ontario, microbrewers benefit from a reduced rate in beer taxes. To qualify for a reduced beer tax rate as a microbrewer, one requirement is that a microbrewer’s worldwide beer production for the production year must not be greater than, according to the 2018 Ontario Budget, 4.9 million litres, or 49,000 hectolitres.

FedNor – Regional Relief and Recovery Fund (RRRF) – Regional Economy Stream in Northern Ontario

The RRRF supports any vulnerable businesses and eligible non-profit organizations that have been impacted by the disruption to the economy caused by the COVID-19 pandemic across all regions of Canada. Eligible applicants can receive 100% of the total eligible costs for bridge support. Eligible small and medium-sized businesses can receive unconditionally repayable and conditionally repayable contributions from the RRRF, and eligible non-profits and First Nation band-owned businesses who have articles of incorporation that do not permit any dividends to be distributed or paid to shareholders will normally be non-repayable.

IESO Grid Innovation Fund

This program advances innovative opportunities to achieve savings for Ontario electricity ratepayers by funding any project that can either enable customers to manage their energy consumption better or that can reduce the costs that are associated with maintaining reliable operation of the power grid in Ontario. Specific projects, not companies, that have a clear objective can receive an investment from the fund.

Ontario Ministry of Economic Development, Job Creation, and Trade

Apprentice Program

When your business takes on an apprentice, this program will provide you with a taxable cash grant when the apprentice finishes their classroom work, completes on-the-job training, and receives their Certificate of Apprenticeship, or depending on the trade their Certificate of Qualification.

Canada-Ontario Job Grant

Eligible employers can receive financial support for training with this grant program. Large businesses with 100 or more employees will need to contribute half of the costs while the grant will provide the other half. Small businesses with less than 100 employees will need to contribute 1/6 of the costs while the grant covers the rest.

SmartStart Seed Fund

Youths between the ages of 19 to 29 in Ontario can receive a number of initiatives for starting an innovation or technology business. Funds can be provided to launch or grow a business after the young entrepreneur can put up matching funds from one or multiple sources.

Starter Company

Youths between the ages of 19 to 29 who are not currently attending school can receive advice on how to start a new business. The program also includes a grant for starting the business as long as you can contribute at least 25% of the funding.

Youth Job Connection

Through this program employers in Ontario can receive help for items such as on-the-job training, hiring, and other training. These incentives apply to job candidates from ages 15 to 29, or 15 to 18 for a summer job. The funding amount depends on the type of training that will be involved and the level of skill from the young person.

Ontario Ministry of Finance

Businesses in Ontario are encouraged to invest and create jobs through multiple tax incentives provided by the province.

Apprenticeship Training Tax Credit

Businesses can use this program to receive a refundable tax credit that is based on salaries that are paid to an apprentice.

Community Food Program Donation Tax Credit for Farmers

This program is a tax credit for farm businesses or corporations who donate food or agricultural products to eligible Ontario community food programs, including food banks. The agricultural must have been produced in Ontario. The credit is allowed in addition to any charitable donation tax credit.

Co-operative Education Tax Credit

Businesses will be able to write off a percentage of eligible expenses when hiring a student that is enrolled in a co-operative or post-secondary education program.

Ontario Business Research Institute Tax Credit

Eligible businesses can use this program to receive a refundable tax credit for any qualified expenses on their scientific research that is performed in Ontario when partnered with an eligible research institute.

Ontario Innovation Tax Credit

Any business that performs its own scientific research and experimental development can receive a refundable tax credit through this program. The business has to meet federal qualifications before receiving this credit through the province.

Ontario Job Creation Investment Incentive

This incentive provides tax write-offs and accelerated rates of depreciation for capital investments, including the purchase of manufacturing equipment, clean energy equipment, and processing equipment that will lead to the creation of jobs.

Ontario Ministry of Natural Resources and Forestry – Forest Sector Investment and Innovation Program

Businesses that are taking a part in the creation of greater market access for firms within the forest sector in Ontario can receive a portion of their project costs in the form of a loan, 50% of the loan can be forgivable if certain performance levels are met by the business.

Eastern Ontario Development Fund

Economic development projects in Eastern Ontario that are working towards eventual business growth and broad positive impact by filling the needs in the area, such as building talent, creating jobs, encouraging innovation and collaboration, and attracting investment from the private sector. To be eligible, for-profit businesses in urban areas will need to invest in their own projects and commit to creating at least five new jobs.

FedNor

Business Scale-Up and Productivity Stream

Businesses can receive funding for their programs through this program, and applicants can attempt to receive support for 50% of the eligible project costs. When the funding is awarded to for-profit businesses, it will typically be repayable. Businesses should have a goal to expand a current business stream or encourage the early adoption of cutting-edge tech with this program contribution.

Targeted Manufacturing Initiative for Northern Ontario

Northern Ontario Manufacturing companies with less than 500 employees can receive funding from this program for creating modernized, enhanced, or more efficient manufacturing capabilities in order to increase profitability and sales. The funding is repayable.

Community Futures Development Corporation (CFDC)

The CFDC is made of a network of 24 non-profit groups that will help with financing for businesses in Northern Ontario. Funding is available through loans, loan guarantees, or equity investments and is repayable.

Youth Internship Guidelines

Northern Ontario businesses may receive funding through this program to hire interns. Businesses can receive up to 50% of the costs for employee benefits, salary, and skills development for the full-time working intern for up to a year.

Southwestern Ontario Development Fund

Businesses in the Southwestern area of Ontario may be awarded funds that are to be used to create jobs and encourage investment from the private sector, all of which are expected to lead to a positive impact on the economy and business growth. Each project will need to commit to creating at least five new jobs and the amount that the business will need to invest at first will vary depending on whether they are in an urban area or a rural area. If the business reaches certain project targets, up to 30% of this loan is forgivable.

Save On Energy

The Save On Energy Program is run by the Independent Electricity System Operator (IESO), which is a Crown corporation that is responsible for the operation of the electricity market in Ontario. The program is an excellent way for businesses to save money on their energy consumption.

Small Business Lighting

This program offers funding for upgrading to energy-efficient lighting for business buildings. The program even provides a turn-key installation solution.

Retrofit Program

With this program, businesses can receive an incentive to install higher efficiency rated equipment in their building.