Knocking down barriers to growth: Helping your business gain access to capital

Posted by: Kaitlyn Mason on May 2, 2017

Lack of access early-stage capital has been a barrier to growth for small businesses in Alberta. For a long time, our province lacked an incentive structure aimed specifically at encouraging the private sector to invest in local – capital starved – enterprises.

Despite this need, Alberta remained one of the only provinces in Canada without an income tax credit for those looking to invest in local small businesses. 

The Calgary Chamber advocated strongly for the creation of a tax credit program to address this policy gap. Then, in last year's budget, we were extremely pleased to hear the provincial government announce the Alberta Investor Tax Credit (AITC). 

The goal of the AITC is to make it easier for Albertans to invest in businesses in their own back-yard, providing local entrepreneurs with the capital they need to innovate and expand. This is a goal, and government program, that we at the Calgary Chamber support. 

The application process for the AITC began in January 2017, and like any new initiative, there were some kinks to be worked out. To help iron them out, the Alberta Government and your Calgary Chamber consulted with both business and investment leaders to determine what the issues were, and the best ways to address them.

To this end, the provincial government has made several changes and policy clarifications (effective as of April 11, 2017) to the AITC regulation: 

  • The requirements regulating the articles of incorporation now clearly state that they apply only to Venture Capital Corporations (VCCs).  
  • VCCs are now eligible to register with the AITC program, so long as the VCC has not received any investments from investors, has not made any investments into businesses, and complies with all other requirements set out in the Investing in a Diversified Alberta Economy Act; and 
  • Companies who have received funding, either directly or indirectly, from the Alberta Enterprise Corporation are now eligible to participate in the program. 

More information on the changes made to the AITC regulation can be found here. 

Through consulting with businesses, and reviewing program processes, requirements and guidelines, we will continue to work with the Alberta Government to reduce regulatory barriers wherever we can.