I-0.4 - Mining Tax Act

Section 20.1 Disposition versions

2015-10-21

20.1. Subject to section 25, the amount that an operator may deduct as a processing allowance in computing its annual earnings from a mine for a fiscal year that begins after 31 December 2013, under subparagraph d of subparagraph 2 of the fourth paragraph of section 8, and in computing the mine-mouth output value in respect of a mine it operates, for such a fiscal year, under subparagraph d of subparagraph 2 of the second paragraph of section 8.1.1, must not exceed the lesser of

(1)  the aggregate of the amounts determined by the following formula in respect of each property of the operator (in this section referred to as the “particular property”) that is a processing asset used in processing ore from the mine in the fiscal year and that is in the operator’s possession at the end of the fiscal year

A × B; and

(2)  an amount corresponding to the greater of

(a)  75% of the operator’s annual earnings from the mine, for the fiscal year, determined without reference to subparagraphs d, e, g and h of subparagraph 2 of the fourth paragraph of section 8, and

(b)  30% of the operator’s mine-mouth output value in respect of the mine, for the fiscal year, determined without reference to subparagraph d of subparagraph 2 of the second paragraph of section 8.1.1.

In the formula in subparagraph 1 of the first paragraph,

(1)  A is the proportion that the use of the particular property in processing ore from the mine is of the total use of the particular property for the purpose of processing ore from the mine and for any other purpose in the fiscal year; and

(2)  B is an amount equal to,

(a)  if the operator does not engage in smelting, refining or hydrometallurgy, 10% of the capital cost to the operator of the particular property,

(b)  if the operator engages in smelting, refining or hydrometallurgy exclusively outside Québec,

i.  10% of the capital cost of the particular property where the property is used solely in processing ore from a gold or silver mine, or

ii.  the amount by which 13% of the capital cost of the particular property, where the property is used in processing ore other than ore from a gold or silver mine, exceeds 3% of the proportion of the capital cost of the particular property, where it is used for concentration purposes, that the quantity of ore concentrated by the operator, which is not smelted or refined by the operator, or is not the subject of hydrometallurgy activity carried on by the operator, and the processing of which required the use of the particular property, is of the total quantity of ore the processing of which required the use of the particular property, or

(c)  if the operator engages in smelting, refining or hydrometallurgy in Québec,

i.  10% of the capital cost of the particular property where the property is used solely in processing ore from a gold or silver mine, or

ii.  the amount by which 20% of the capital cost of the particular property, where the property is used in processing ore other than ore from a gold or silver mine, exceeds the aggregate of 7% of the proportion of the capital cost of the particular property that the quantity of ore that is smelted or refined by the operator outside Québec, or is the subject of hydrometallurgy activity carried on by the operator outside Québec, and the processing of which required the use of the particular property, is of the total quantity of ore the processing of which required the use of the particular property, and 10% of the proportion of the capital cost of the particular property, where it is used for concentration purposes, that the quantity of ore concentrated by the operator, which is not smelted or refined by the operator, or is not the subject of hydrometallurgy activity carried on by the operator, and the processing of which required the use of the particular property, is of the total quantity of ore the processing of which required the use of the particular property.

2015, c. 21, s. 66.