Payroll Rebate Approved

Nova Scotia Business Inc. (NSBI) has approved a business development incentive, in the form of a payroll rebate, for the Bank of N.T. Butterfield and Son Limited (Butterfield Bank) of Bermuda.

Butterfield Bank is a provider of specialized international financial services with the potential to create up to a maximum of 50 new jobs for its shared services centre in Nova Scotia. Based on the maximum growth forecast of the six-year payroll rebate agreement, NSBI estimates the bank would spend $10.5 million in salaries.

The new employees would pay provincial, personal income taxes of about $1.144 million. As a result, Butterfield Bank would earn up to $840,000 through the payroll rebate, over six years. The bank will be eligible for a smaller rebate if it creates fewer than the 50 new jobs.

Quick facts:

• payroll rebates are designed in a way that the tax revenue generated for the province by the new jobs in Nova Scotia is always more than the amount spent on the rebate
• payroll rebates are only paid after a business has generated actual payroll for the Nova Scotia economy
• for every dollar a company spends on the new jobs, it receives between five and ten cents back
• when a company submits an annual rebate claim, it must send NSBI audited information that confirms the number of jobs it created that year
• payroll rebates are paid through the Strategic Investment Funds

Information on NSBI transactions can be found at http://www.novascotiabusiness.com/fundingdisclosures.