I-3 - Taxation Act

Section 1029.8.36.72.11 Disposition versions

2021-06-04

1029.8.36.72.11. (Repealed).

2001, c. 51, s. 182; 2002, c. 40, s. 174; 2004, c. 21, s. 367; 2021, c. 18, s. 125.

2006-03-01

1029.8.36.72.11. Subject to sections 1029.8.36.72.9 and 1029.8.36.72.10, where, at a particular time in a particular calendar year, the activities carried on by a person or partnership, in this section referred to as the “vendor”, in relation to a recognized business or a business that would be a recognized business if a qualification certificate had been issued in its respect, diminish or cease, and where it may reasonably be considered that, as a result, another person or partnership, in this section referred to as the “purchaser”, begins, after the particular time, to carry on similar activities in the course of carrying on such a business, or increases, after that time, the scope of similar activities carried on in the course of carrying on such a business, the following rules apply, subject to the third and fourth paragraphs, for the purpose of determining the amount that a corporation is deemed to have paid to the Minister under this division for the taxation year in which the particular calendar year ends and for the taxation year in which the following calendar year ends:

(a)  the aggregate of all amounts each of which is the salary or wages paid by the vendor to an employee in a pay period, within its base period in relation to the particular calendar year, for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the vendor situated in Québec that were paid by the vendor in a pay period, within its base period in relation to the particular calendar year, for which the employee would be an eligible employee of the vendor if the establishment where the employee so reported for work were situated in the Québec area, is deemed to be equal to the amount by which the aggregate otherwise determined exceeds the amount determined by the formula

A × B × C;

(b)  the aggregate of all amounts each of which is the salary or wages paid by the vendor to an employee in a pay period of the particular calendar year preceding the particular time for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the vendor situated in Québec that were paid by the vendor in a pay period of the particular calendar year preceding the particular time for which the employee would be an eligible employee of the vendor if the establishment where the employee so reported for work were situated in the Québec area, is deemed, for the purpose of determining the amount that the vendor is deemed to have paid to the Minister under this division for the taxation year in which the calendar year following the particular calendar year ends, to be equal to the amount by which the aggregate otherwise determined exceeds the amount determined by the formula

B × D; and

(c)  the purchaser is deemed

i.  to have an eligible amount for the particular calendar year equal to the aggregate of its eligible amount for the year otherwise determined and the amount that is that proportion of the aggregate of all amounts each of which is the salary or wages paid by the vendor to an employee in a pay period, within the particular calendar year, for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the vendor situated in Québec that were paid by the vendor in a pay period, within the particular calendar year, for which the employee would be an eligible employee of the vendor if the establishment where the employee so reported for work were situated in the Québec area, to the extent that the employee may reasonably be considered to have been assigned to the carrying on of the part of the activities that diminished or ceased at the particular time, that the number of days in the particular calendar year that precede the particular time is of the number of days in the particular calendar year that precede the particular time and during which the vendor carried on those activities, and

ii.  to have a base amount in relation to the particular calendar year equal to the aggregate of

(1)  the base amount of the purchaser otherwise determined in relation to the particular calendar year,

(2)  the amount that is that proportion of the salary or wages paid by the vendor to an employee in a pay period, within the particular calendar year, for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the vendor situated in Québec that were paid by the vendor in a pay period, within the particular calendar year, for which the employee would be an eligible employee of the vendor if the establishment where the employee so reported for work were situated in the Québec area, to the extent that the salary or wages may reasonably be considered to relate to the carrying on by the employee of the part of the activities that diminished or ceased at the particular time, that the number of days in the particular calendar year that precede the particular time is of the number of days in the particular calendar year that precede the particular time and during which the vendor carried on those activities, and

(3)  the aggregate of all amounts each of which is the salary or wages paid by the purchaser to an employee in a pay period of the particular calendar year and after the particular time, for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the purchaser situated in Québec that were paid by the purchaser in a pay period of the particular calendar year and after the particular time, for which the employee would be an eligible employee of the purchaser if the establishment where the employee so reported for work were situated in the Québec area, to the extent that the salary or wages may reasonably be considered to relate to the carrying on by the employee of the part of the activities that began or increased at the particular time.

In the formulas provided for in subparagraphs a and b of the first paragraph,

(a)  A is the aggregate of all amounts each of which is the salary or wages paid by the vendor to an employee in a pay period, within its base period for the particular calendar year, for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the vendor situated in Québec that were paid by the vendor in a pay period within its base period in relation to the particular calendar year for which the employee would be an eligible employee of the vendor if the establishment where the employee so reported for work were situated in the Québec area;

(b)  B is the proportion that the number of the vendor’s employees referred to in subparagraph a who are assigned to the part of the activities that diminished or ceased at the particular time is of the number of the vendor’s employees assigned to those activities immediately before the particular time;

(c)  C, where this section applies for the purpose of determining the amount that a corporation is deemed to have paid to the Minister under this division in respect of the particular calendar year, is the proportion that the number of days in the particular calendar year following the particular time is of 365; and

(d)  D is the aggregate of all amounts each of which is the salary or wages paid by the vendor to an employee in a pay period of the particular calendar year preceding the particular time for which the employee is an eligible employee, or the salary or wages of an employee who reports for work at an establishment of the vendor situated in Québec that were paid by the vendor in a pay period of the particular calendar year preceding the particular time for which the employee would be an eligible employee of the vendor if the establishment where the employee so reported for work were situated in the Québec area.

Where a particular corporation is, at any time in a calendar year, a purchaser in relation to activities carried on by a person or partnership and, at a subsequent time in the same calendar year, the particular corporation is a vendor in relation to all of those activities, this section does not apply to the particular corporation either as vendor or as purchaser in respect of the activities and, for the purpose of determining the amount that a corporation is deemed to have paid to the Minister under this division, the particular corporation is deemed to have paid, from that time to the subsequent time, no portion of the salaries or wages that may reasonably be considered to relate to the employees assigned to the carrying on of the activities that ceased after the subsequent time.

For the purposes of this section, where a corporation is, at a particular time in a calendar year, a purchaser in relation to activities carried on by a person or partnership and, at a subsequent time in the same calendar year, that corporation is a vendor in relation to part of those activities, the following rules apply for the purpose of determining the eligible amount of the corporation for the year and its base amount in relation to that year:

(a)  the corporation’s employees are deemed to have been paid by the corporation only the portion of the salaries or wages that may reasonably be considered to have been paid to the employees assigned to the part of the activities that the corporation continues to carry on after that subsequent time; and

(b)  the person’s or partnership’s employees are deemed to have been paid by the person or partnership only the portion of the salaries or wages that may reasonably be considered to have been paid to the employees assigned to the part of the activities that the corporation continues to carry on after that subsequent time.

2001, c. 51, s. 182; 2002, c. 40, s. 174; 2004, c. 21, s. 367.