I-3 - Taxation Act

Section 1049.14.26 Disposition versions

2021-06-04

1049.14.26. Where a corporation has received an amount for the issue of a share of its capital stock in relation to an authorized investment certificate and any of the conditions provided for in the third paragraph is met, the corporation incurs a penalty equal to the amount determined by the formula

A – B.

In the formula in the first paragraph,

(a)  A is 30% of the aggregate of all amounts each of which is the amount received by the corporation for the issue of a share of its capital stock in relation to the authorized investment certificate, to the extent that that amount was not taken into account in determining the amount of a penalty imposed on the corporation under the first paragraph or any of sections 1049.14.27 to 1049.14.29; and

(b)  B is the corporation’s balance of the penalty account payable in relation to the authorized investment certificate at the time the penalty is determined.

The conditions to which the first paragraph refers are as follows:

(a)  at any time in the particular taxation year that includes the day on which the certificate is applied for or in a taxation year that begins in the 48-month period following the end of the particular year, the corporation is not a Canadian-controlled private corporation;

(b)  at no time in a year referred to in subparagraph a does the corporation carry on a business in Québec or have an establishment in Québec; and

(c)  at least 50% of the salaries or wages paid by the corporation in a year referred to in subparagraph a is paid to employees who are not, within the meaning of the regulations made under section 771, employees of an establishment situated in Québec.

2021, c. 18, s. 148.