Canadian Journalism Tax Credit 2025: Labour Cost Limit Rises to $85,000 Per Employee

Introduction

In an era of declining advertising revenues, increasing digital competition, and evolving audience behavior, journalism in Canada faces unprecedented challenges. To bolster the sustainability and independence of Canadian newsrooms, the federal government introduced the Canadian Journalism Labour Tax Credit (CJTC)—a refundable tax credit aimed at supporting eligible media organizations by offsetting labour costs.

In a noteworthy 2025 update, the government has raised the annual labour cost limit from $55,000 to $85,000 per eligible employee, marking a significant increase in potential tax support per journalist. Additionally, the tax credit rate has been temporarily raised from 25% to 35%, making this one of the most substantial enhancements to journalism funding in years.

This article will take a deep dive into the changes, who benefits, how to qualify, what the broader implications are for Canada’s media industry, and much more.

Understanding the Canadian Journalism Labour Tax Credit (CJTC)

The Canadian Journalism Labour Tax Credit (CJTC) is a refundable tax credit introduced as part of the federal government’s 2019 budget. It supports qualified Canadian journalism organizations (QCJOs) by covering a portion of the salaries and wages paid to eligible newsroom employees.

This credit is part of a larger effort to foster independent, non-partisan journalism that is critical to the functioning of a healthy democracy. The program is administered by the Canada Revenue Agency (CRA).

Original Design (Pre-2025)

• Credit rate: 25%
• Maximum qualifying labour cost per employee: $55,000
• Maximum credit per employee: $13,750 (25% of $55,000)

What’s New in 2025?

Effective from the 2023 tax year, but continuing strongly in 2025, the government announced two major changes to the CJTC:

1. Increase in the annual qualifying labour expenditure limit
   • From $55,000 to $85,000
   • This means each eligible employee can now contribute up to $85,000 in qualifying expenses.
2. Temporary increase in the tax credit rate
   • From 25% to 35%, until December 31, 2026
   • After that, it will revert back to 25%

Updated Maximum Credit Per Employee

With these enhancements:

• New maximum credit per employee = 35% of $85,000 = $29,750
• This is more than double the original cap of $13,750.

Why the Increase?

There are several driving factors behind this decision:

1. Inflation and Rising Labour Costs

Newsrooms face increasing payroll burdens. The $55,000 cap was no longer realistic for today’s media salaries.

2. Decline in Advertising Revenue

Traditional advertising has migrated to global tech platforms. As revenue streams shrink, newsrooms need stronger lifelines to survive.

3. Supporting Local Journalism

Community-based journalism has been particularly hard hit. This enhanced credit allows smaller publications to retain or hire critical staff.

4. Digital Transformation

The media landscape is rapidly shifting toward digital. Financial support allows organizations to retrain staff and adopt new technologies.

Who is Eligible?

1. Qualified Canadian Journalism Organizations (QCJOs)

To be eligible, an organization must be designated by the CRA as a QCJO. This designation is based on several criteria:

• The primary purpose must be to produce original news content.
• Content must be primarily focused on matters of general interest.
• It must employ at least two journalists who work an average of 26 hours/week.
• The organization must not be government-controlled.

2. Eligible Employees

Eligible newsroom employees are those who:

• Spend at least 75% of their time on journalistic content creation.
• Are employed full-time, generally working 26+ hours per week.
• Are not in sales, admin, or other non-editorial roles.

How to Apply

Organizations must follow these steps:

1. Obtain QCJO status through an application to the CRA.
2. Complete and file Schedule 29 (for CJTC) with their T2 Corporate Income Tax Return.
3. Maintain records of qualifying labour expenditures, including employee roles, contracts, and hours worked.
4. Be ready for CRA audits or follow-ups, especially for employee eligibility.

Example Calculation

Let’s consider a newsroom employing 10 eligible journalists, each earning $85,000 annually.

• Total qualifying labour cost = $85,000 x 10 = $850,000
• Credit = 35% of $850,000 = $297,500

This tax credit is refundable, meaning even if the newsroom has little or no taxable income, it can receive a refund of $297,500.

Impact on the Canadian Journalism Industry

1. Financial Stability for News Outlets

Newsrooms can now offset a larger portion of their payroll expenses, allowing for sustainable growth and staff retention.

2. Boost to Employment

Smaller organizations may now be able to hire more journalists, especially those focused on investigative or local reporting.

3. Quality and Independence

With greater financial independence, organizations can uphold higher journalistic standards and reduce reliance on corporate or political funding.

4. Bridging the Urban-Rural Divide

Rural news outlets can compete more effectively, ensuring that communities across Canada receive high-quality news coverage.

Criticism and Concerns

While the program is widely welcomed, there are also some concerns:

• Eligibility can be restrictive, especially for digital startups or niche publications.
• Some argue that government funding risks influencing editorial independence, although QCJOs must be non-partisan and independent.
• Verification and audits by CRA can be time-consuming.

Still, the benefits for the industry appear to outweigh the drawbacks.

Conclusion

The 2025 enhancement to the Canadian Journalism Labour Tax Credit—increasing the annual labour cost limit from $55,000 to $85,000 and the temporary credit rate to 35%—marks a bold step forward in supporting Canada’s press industry.

This move not only acknowledges the critical role that journalism plays in society, but also helps sustain jobs, improve reporting quality, and foster a diverse and democratic media environment.

Whether you’re a journalist, publisher, or citizen invested in trustworthy news, these changes signal a renewed commitment to safeguarding the future of Canadian journalism.

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