The gross-up and dividend tax credit are applicable to individuals, not corporations.
Non-eligible dividends, also known as regular, ordinary, or small business dividends, are any dividends issued by a Canadian corporation, public or private, which are not eligible for the enhanced dividend tax credit.
The non-eligible dividend tax credit rate is used for dividends received by individuals from Canadian-controlled private corporations (CCPCs), to the extent that their income is subject to tax at the small business rate. A portion of dividends from large public corporations may also be classified as not being eligible for the enhanced dividend tax credit and would therefore be classified as non-eligible dividends.
When an individual receives non-eligible dividends, the amount included in taxable income in 2016 and later years is 117% (for 2014 and 2015 it was 118%, 2013 and earlier years it was 125%) of the actual dividend. The additional 17% is referred to as the gross-up.