I-3, r. 1 - Regulation respecting the Taxation Act

Section 130r75.1 Disposition versions

2014-12-23

130R75.1. Despite the definition of “exempt property” in the first paragraph of section 130R71, exempt property does not include property that is the subject of a lease if that property had, at the time the lease was entered into, a fair market value in excess of $1,000,000 and the lessee of the property is

(a)  a person who is exempt from tax by reason of Book VIII of Part I of the Act;

(b)  a person who uses the property in the course of carrying on a business, the income from which is exempt from tax under Part I of the Act by reason of any provision of the Act;

(c)  a Canadian government; or

(d)  a person not resident in Canada, except if the person uses the property primarily in the course of carrying on a business in Canada that is not a treaty-protected business.

For the purposes of the first paragraph, if it is reasonable, having regard to all the circumstances, to conclude that one of the main reasons for the existence of two or more leases was to avoid the application of the first paragraph by reason of each such lease being a lease of property where the property that was the subject of the lease had a fair market value, at the time the lease was entered into, not in excess of $1,000,000, each such lease is deemed to be a lease of property that had, at the time the lease was entered into, a fair market value in excess of $1,000,000.

O.C. 1105-2014, s. 4.