I-3 - Taxation Act

Section 1029.8.36.0.0.16 Disposition versions

2010-10-27

1029.8.36.0.0.16. (Repealed).

2002, c. 40, s. 137; 2010, c. 25, s. 135.

2006-03-01

1029.8.36.0.0.16. In this division,

“acquisition costs” incurred by a corporation in respect of qualified property means the aggregate of the costs incurred by the corporation to acquire the qualified property, to the extent that the property is acquired before 1 January 2003, and that are included in the capital cost of the property;

“associated group” has the meaning assigned by section 1029.8.36.0.0.17;

“eligible digital production” of a corporation for a taxation year means a digital production created in Québec and presented before an audience in Québec for the first time after 6 October 2000, in respect of which the corporation holds, for the year, a certificate issued by Investissement Québec for the purposes of this division;

“qualified corporation” for a taxation year means a corporation that, in the year, has an establishment in Québec and carries on in Québec a business of creating digital productions, but does not include

(a)  a corporation that is exempt from tax for the year under Book III; or

(b)  a corporation that would be exempt from tax for the year under section 985, but for section 192;

“qualified labour expenditure” of a corporation for a taxation year in respect of an eligible digital production means, subject to the second paragraph, the aggregate of the following amounts, to the extent that they are reasonable in the circumstances:

(a)  the wages attributable to the creation of the eligible digital production incurred by the corporation in the year, before 1 January 2003, and paid, in respect of its employees of an establishment situated in Québec whose duties consist in working directly on the creation of the eligible digital production;

(b)  the aggregate of all amounts each of which is the portion of the consideration paid by the corporation, under the terms of a contract, for work in respect of the creation of the eligible digital production that was carried out on its behalf in the year, to a person or partnership who or which carried out all or a part of the work and with whom or with which the corporation is not dealing at arm’s length at the time the contract is entered into, that may reasonably be attributed to the wages attributable to the work that the person or partnership paid in the year, before 1 January 2003, in respect of its employees of an establishment situated in Québec, or that could be so attributed if that person or partnership had such employees; and

(c)  the aggregate of all amounts each of which is one-half of the portion of the consideration paid by the corporation, under the terms of a contract, for work in respect of the creation of an eligible digital production, to a person or partnership with whom or with which the corporation is dealing at arm’s length at the time the contract is entered into, that may reasonably be attributed to the work carried out on its behalf in the year, before 1 January 2003, by the employees of an establishment of that person or partnership situated in Québec, or that could be so attributed if that person or partnership had such employees;

“qualified property” of a corporation means

(a)  in the case of property acquired by the corporation, property

i.  that is depreciable property,

ii.  that, before being acquired by the corporation, has not been used, or acquired for use or lease, for any purpose whatever,

iii.  that is used by the corporation solely in connection with the creation and exploitation of an eligible digital production for a minimum period of two years without interruption following its first use by the corporation,

iv.  that the corporation begins to use within a reasonable time after acquiring it, and

v.  in respect of which Investissement Québec has issued a qualification certificate certifying that the property is equipment necessary for the creation of an eligible digital production; or

(b)  in the case of property leased by the corporation, property

i.  that would be, had the corporation acquired it, depreciable property,

ii.  that, before being leased by the corporation, has not been used, or acquired for use or lease, for any purpose whatever,

iii.  that the corporation begins to use within a reasonable time after leasing it, and

iv.  in respect of which Investissement Québec has issued a qualification certificate certifying that the property is equipment necessary for the creation of an eligible digital production;

“rental expenses” paid by a corporation in respect of qualified property means the aggregate of the expenses paid by the corporation for the lease of the property to the extent that the expenses are deductible in computing the income of the corporation under this Part and attributable to a lease period, preceding 1 January 2003, during which the property is used by the corporation in connection with the creation and exploitation of an eligible digital production;

“wages” means the income computed pursuant to Chapters I and II of Title II of Book III.

For the purposes of paragraph a of the definition of “qualified labour expenditure” in the first paragraph, wages incurred by a corporation in respect of an employee are attributable to the creation of an eligible digital production only if the employee works directly on the creation of the eligible digital production and to the extent that they can reasonably be considered to relate to the eligible digital production having regard to the time spent by the employee thereon, and, in that respect, an employee who spends 90% or more of working time on the creation of an eligible digital production is deemed to spend all working time thereon.

2002, c. 40, s. 137.