I-3 - Taxation Act

Section 165.1 Disposition versions

2006-03-01

165.1. Where a taxpayer who is a member of a partnership is obligated to pay an amount as interest or in full or partial payment of interest on money that was borrowed by him before 1 April 1977 and that was used by him to acquire land owned by the partnership before that day or pursuant to an obligation entered into by him before 1 April 1977 to pay for such land, and, in a taxation year of the taxpayer, the partnership disposes of all or part of the land, or the taxpayer disposes of all or part of his interest in the partnership, to a person other than a person with whom the taxpayer does not deal at arm’s length, the taxpayer may, in computing his income for the year or any subsequent taxation year, deduct such part of the amount as may reasonably be attributed to the part of the land or interest in the partnership, as the case may be, that is so disposed of and that was not

(a)  deductible under section 164 in computing the income of the taxpayer for any previous year,

(b)  deductible in computing the income of another taxpayer for any taxation year,

(c)  included in computing the adjusted cost base to the taxpayer of any property, nor

(d)  deductible, under this section, in computing the income of the taxpayer for a previous taxation year.

1978, c. 26, s. 38; 1995, c. 49, s. 48; 1997, c. 3, s. 71.