I-3 - Taxation Act

Section 1029.8.36.59.51 Disposition versions

2020-09-24

1029.8.36.59.51. For the purposes of this division and subject to the second and third paragraphs, the following rules apply:

(a)  the qualified expenditure of a qualified corporation or of a qualified partnership for a taxation year of the corporation or a fiscal period of the partnership, in relation to an eligible employee and in respect of a calendar year, may not exceed the quotient obtained by dividing $1,875 by the eligible rate of the corporation for the taxation year or of the partnership for the fiscal period, as the case may be; and

(b)  the specified expenditure of a qualified corporation or of a qualified partnership for a taxation year of the corporation or a fiscal period of the partnership, in relation to a specified employee and in respect of a calendar year, may not exceed the quotient obtained by dividing $1,250 by the specified rate of the corporation for the taxation year or of the partnership for the fiscal period, as the case may be.

For the purpose of determining the qualified expenditure or the specified expenditure of a qualified corporation for a taxation year or of a qualified partnership for a fiscal period, where, at the end of a calendar year that ends in the taxation year or fiscal period, as the case may be, the qualified corporation or qualified partnership is a member of an associated group and more than one member of the group (each of whom being referred to in this section as a “particular member”) paid, in a calendar year, an amount on account of a salary, wages or other remuneration to the same employee who is, for each of the particular members, an eligible employee or a specified employee for the taxation year or fiscal period, as the case may be, of the particular member in which the calendar year ended, the qualified expenditure or the specified expenditure of the qualified corporation for the year or of the qualified partnership for the fiscal period, in relation to the employee, is, subject to the third paragraph, equal to zero.

Despite the second paragraph, where the particular members have filed with the Minister, in the prescribed form, an agreement whereby, for the purposes of this division, they allocate an amount to one or more of them as a qualified expenditure or specified expenditure for the taxation year or fiscal period, as the case may be, in relation to the same eligible employee or specified employee, the following rules apply:

(a)  the amount of the qualified expenditure of the qualified corporation for the taxation year or of the qualified partnership for the fiscal period, as the case may be, in relation to that eligible employee, is deemed to be equal, where the product obtained by multiplying the aggregate of all amounts each of which is the amount so allocated to a particular member, in relation to the eligible employee, by the eligible rate of the qualified corporation for the taxation year or of the qualified partnership for the fiscal period, as the case may be, does not exceed $1,875, to the amount so allocated to the corporation for the year or to the partnership for the fiscal period; and

(b)  the amount of the specified expenditure of the qualified corporation for the taxation year or of the qualified partnership for the fiscal period, as the case may be, in relation to the specified employee, is deemed to be equal, where the product obtained by multiplying the aggregate of all amounts each of which is the amount so allocated to a particular member, in relation to the specified employee, by the specified rate of the qualified corporation for the taxation year or of the qualified partnership for the fiscal period, as the case may be, does not exceed $1,250, to the amount so allocated to the corporation for the year or to the partnership for the fiscal period.

For the purposes of subparagraphs a and b of the third paragraph, the eligible rate and the specified rate of a corporation or of a partnership for a taxation year or fiscal period, as the case may be, are those determined for the year or fiscal period in accordance with the second and third paragraphs of section 1029.8.36.59.50.

For the purposes of this section, an associated group, at the end of a calendar year, means all the qualified corporations and qualified partnerships that are associated with each other at that time.

2020, c. 16, s. 147.