Short answer: Most Canadian visual effects work happens in Vancouver, Montreal and Toronto. Each province pays its credit on its own test: British Columbia counts labour by B.C.-based people, Quebec counts costs incurred in Quebec, Ontario counts Ontario residents. With artists working remotely, ask where the people live and which company pays them, not which city the vendor lists.
A production deciding where its effects work could go usually starts with a map and ends with a spreadsheet. The map is short. The spreadsheet is where the decision gets made, because each province has written its own rules about whose labour counts.
Ontario has its own article. Where VFX work happens in Toronto covers the Ontario credits, the March 2024 change that lets a standalone effects package qualify there, and the provincial rates side by side. This page covers the other two hubs, the federal layer under all three, and what remote work changes.
Where is the VFX industry in Canada?
Three cities carry most of it. In a 2024 survey of the Canadian industry, VFX Voice described Canada as powered by studios in Vancouver, Toronto and Montreal, and quoted Shawn Walsh of Image Engine naming those three as the cities where the majority of the work happens.
The same article named companies in each. It describes Image Engine as founded in Vancouver in 1995 and lists Vancouver outposts of Wētā FX, ILM, Framestore and DNEG among others. For Montreal it describes Raynault VFX as founded there in 2011 and lists branches of Framestore, DNEG and Sony ImageWorks among others.
Treat any roster like that as a starting point with a date on it. That one is from April 2024, and branches open, merge and close faster than articles get updated. Check that a studio still runs an office in the city before you put it on a bid list. In Ontario, the province publishes a supplier directory, the Ontario Production Guide, with its own Post, VFX and Animation category.
What matters more is what each province's credit actually measures, because that decides which of those studios can lower your bill.
How British Columbia pays for effects labour
British Columbia runs two programs, and both carry a visual effects credit. The production services tax credit is open to domestic and foreign producers with no Canadian content requirement. The film and television tax credit is for domestic productions with qualifying Canadian content. Each includes a digital animation, visual effects and post-production credit, called DAVE, at 16 per cent, and the province says to calculate each credit by multiplying your qualified B.C. labour expenditure by its rate.
The province describes the production services credit as one for accredited production corporations that produce accredited productions in B.C., so ask early which corporation will claim it.
The test underneath is the person, not the postcode. The province's frequently asked questions explain that a B.C.-based individual is defined by residency on December 31 of the year before the end of the tax year being claimed. The same page says that mailing a T4 to an address outside B.C. would suggest the person may not be B.C.-based for the claim.
There is one place the B.C. pages do tie the credit to a desk. The regional and distant location credits for animation productions need a physical office outside the designated Vancouver area, and B.C.-based individuals working in it for at least 50 per cent of their time on the production. The FAQ adds that a subcontractor's employees must also meet that 50 per cent test in the claiming corporation's office.
Two procedural points from the production services page, which was last updated in August 2026. Budget 2026 removed the pre-certification step for productions that first incur accredited B.C. labour on or after October 20, 2025, and raised the accreditation certificate fee from $10,000 to $19,000 for applications received from March 1, 2026, where principal photography started after December 31, 2024.
How Quebec pays for it
Quebec builds its credit differently. SODEC's March 2026 fact sheet for the production services credit sets a basic 25 per cent on all-spend production costs incurred in Quebec, and an improvement of 16 per cent on qualified labour costs for computer-aided special effects and animation. Where the effects come through a service contract, a 65 per cent cap applies to the combined rate.
Several lines on that sheet matter more to an effects buyer than the rates do:
- The minimum budget is $250,000, and the production can be partially done in Quebec.
- The claiming corporation has to be established in Quebec, with activities primarily in film and television, but it does not have to be controlled by Quebec residents.
- A footnote lists roles whose cost qualifies only if the person resides in Quebec when the services are provided. A visual effects supervisor is on that list.
- The advance ruling goes to the copyright owner, or to an eligible corporation under a direct contractual link with the copyright owner that provides services in Quebec. For Quebec CGI corporations with a contract of up to $1.5 million, a notarized confirmation of copyright ownership will suffice.
The direct-link rule is the one to raise early. If a Montreal vendor would sit under another vendor rather than under the production, ask who holds the advance ruling before the work is split. SODEC's program page describes the same structure and notes that shooting in front of a chroma-key screen also gives rise to the higher rate.
The federal layer does not care which city
Under all three provinces sits the federal production services credit. Section 125.5 of the Income Tax Act sets it at 16 per cent of qualified Canadian labour expenditure.
The definition is about Canada, not a province. It counts salary paid to employees resident in Canada for services rendered in Canada, from the final script stage to the end of post-production. It also counts amounts paid to another taxable Canadian corporation, to the extent of what that corporation pays its own employees resident in Canada for services they personally rendered in Canada on the production. A Vancouver vendor and a Halifax vendor look the same to this test.
Ontario tests both the person and the premises. Its animation and special effects credit counts wages paid to Ontario residents who report to a permanent establishment of the claiming corporation in Ontario at which the eligible activities are carried out. Its FAQ asks whether remote employees and contractors count, and answers only by pointing to the Canada Revenue Agency.
Does the vendor's city still matter if artists work remotely?
Less than it used to, and not in the way people expect.
Every credit above tests a person and a corporation: where the person is resident, where the services were rendered, which corporation paid them, and whether that corporation is established in the province. None of them asks for an office in a particular city, and the B.C. credits that do mention geography, the regional and distant location credits, reward work done outside the Vancouver area. So a vendor with a Vancouver office and artists spread across the country may not be a B.C. labour story at all, and a vendor in a smaller city is not at a disadvantage on the rules as written.
Remote work moves the question from the vendor's city to the artist's province. A Montreal studio whose environment artist works from home in Ontario is, on the fact sheet's wording, paying for services that were not provided in Quebec. That labour may still count federally. Whether it counts anywhere provincially depends on facts only the vendor knows.
So the questions to send with the shot list are short:
- Which corporation will incur the labour, and in which province is it established?
- Where are the artists on this package resident, and where will they do the work?
- Which provincial and federal credits does the vendor expect the labour to support, and is any of that already in the quote?
- If a credit depends on a certificate or ruling, who holds it, and when is it filed?
Ask your production accountant how the answers fit your budget. The rates are published. How they apply to your show is not.
The other provinces
Effects work is not confined to three cities, but the rules elsewhere differ from province to province. For any province, read its own program page and confirm whether effects labour is counted at all before you build a split around it.
Before you split the work
If you are spreading a show across provinces, decide who owns the look before you decide where the shots go. Two vendors in two cities painting neighbouring shots will drift apart unless one person holds the reference. The questions in what to ask a VFX vendor cover the rest, and VFX outsourcing and VFX vendors explains how packages are usually divided.
Chumak Studio paints environments for film and television, in Toronto, through digital matte painting and 3D environments. Anastasiia Chumak's credits include House of the Dragon, as Senior matte painter, Pixomondo. If you have a shot and you are not sure what it needs, send the frame and you will get a straight answer about whether this is the right tool for it.
