I-3 - Taxation Act

Section 93.2 Disposition versions

2006-03-01

93.2. Where in the taxation year referred to in section 93.1 the taxpayer or a person with whom the taxpayer does not deal at arm’s length disposes of the land subjacent to, or immediately contiguous to and necessary for the use of, the building, the following rules apply:

(a)  the proceeds of disposition of the building are deemed to be equal to the lesser of

i.  the amount by which the aggregate of the fair market value of the building at the particular time referred to in section 93.1 and the fair market value of the land immediately before its disposition exceeds the lesser of

(1)  the fair market value of the land immediately before its disposition, and

(2)  the amount by which the cost amount to the vendor of the land, determined without reference to this section and sections 93.1 and 93.3, exceeds the aggregate of the capital gains, determined without reference to subparagraph b of the first paragraph and the second paragraph of section 234, in respect of dispositions of the land within three years before the particular time by the taxpayer or by a person with whom the taxpayer was not dealing at arm’s length to the taxpayer or to another person with whom the taxpayer was not dealing at arm’s length, and

ii.  the greater of the fair market value of the building at the particular time and the lesser of the cost amount and the capital cost to the taxpayer of the building immediately before its disposition;

(b)  notwithstanding any other provision of this Part, the proceeds of disposition of the land are deemed to be equal to the amount by which the aggregate of the proceeds of disposition of the building and of the land determined without reference to this section and sections 93.1, 93.3 and 93.3.1 exceeds the proceeds of disposition of the building as determined under paragraph a; and

(c)  the cost to the purchaser of the land shall be determined without reference to this section and sections 93.1 and 93.3.

1984, c. 15, s. 22; 1986, c. 19, s. 20; 2000, c. 5, s. 31.