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I-3 - Taxation Act

Section 736.0.3.1
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736.0.3.1. Subject to section 736.0.5, where, at any time, a taxpayer, other than a taxpayer who at that time became or ceased to be exempt from tax under this Part on the taxpayer’s taxable income, is subject to a loss restriction event, no amount may be deducted under section 140 in computing the taxpayer’s income for the taxpayer’s taxation year ending immediately before that time and each amount that is the greatest amount that would, but for this section, have been deductible under section 140 in respect of a debt owing to the taxpayer immediately before that time is deemed to be a separate debt and is, despite any other provision of this Part, to be deducted as a bad debt under section 141 in computing the taxpayer’s income for the year.
In addition, the amount by which the debt exceeds that separate debt is deemed to be a separate debt incurred at the same time and under the same circumstances as the debt was incurred.
1989, c. 77, s. 82; 1995, c. 49, s. 236; 1997, c. 3, s. 71; 1997, c. 31, s. 72; 2017, c. 1, s. 179.
736.0.3.1. Where, at any time, control of a corporation, other than a corporation that at that time became or ceased to be exempt from tax under this Part on its taxable income, has been acquired by a person or group of persons, no amount may be deducted under section 140 in computing the corporation’s income for its taxation year ending immediately before that time and each amount that is the greatest amount that would, but for this section, have been deductible under section 140 in respect of a debt owing to the corporation immediately before that time is deemed to be a separate debt and shall, notwithstanding any other provision of this Part, be deducted as a bad debt under section 141 in computing the corporation’s income for the year.
In addition, the amount by which the debt exceeds that separate debt is deemed to be a separate debt incurred at the same time and under the same circumstances as the debt was incurred.
1989, c. 77, s. 82; 1995, c. 49, s. 236; 1997, c. 3, s. 71; 1997, c. 31, s. 72.
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