I-3 - Taxation Act

Section 359.2 Disposition versions

2023-09-26

359.2. Where a person gave consideration under an agreement to a corporation for the issue of a flow-through share of the corporation and, in the period that begins on the day the agreement was entered into and ends 24 months after the end of the month that includes that day, the corporation incurred Canadian exploration expenses (other than expenses deemed to be Canadian exploration expenses of the corporation under the first paragraph of section 399.3), the corporation may, after it complies with section 359.10 in respect of the share and before 1 March of the first calendar year that begins after that period, renounce to the person in respect of the share the amount by which the part of those expenses incurred by it on or before the effective date of the renunciation, which part is in this section referred to as the “specified expenses”, exceeds the aggregate of

(a)  the assistance that the corporation has received, is entitled to receive, or may reasonably expect to receive at any time, and that can reasonably be related to the specified expenses or to Canadian exploration activities to which the specified expenses relate, other than assistance that can reasonably be related to expenses referred to in any of subparagraphs b to b.2;

(b)  all specified expenses that are prescribed Canadian exploration and development overhead expenses of the corporation;

(b.1)  all specified expenses each of which is a cost of, or for the use of, seismic data

i.  that had been acquired, otherwise than as a consequence of performing work that resulted in the creation of the data, by any other person before the cost was incurred,

ii.  in respect of which a right to use had been acquired by any other person before the cost was incurred, or

iii.  all or substantially all of which resulted from work performed more than one year before the cost was incurred;

(b.2)  if the agreement is entered into after 31 March 2023, all specified expenses that are not described in subparagraph b or b.1 and that would be Canadian exploration expenses if

i.  section 395 were read without reference to its paragraph c.2, and

ii.  the definition of “mineral resource” in section 1 were read as follows:

““mineral resource” means a coal deposit, a bituminous sands deposit or an oil shale deposit;”; and

(c)  the aggregate of amounts that are renounced by the corporation on or before the date on which the renunciation is made by any other renunciation under this section in respect of those expenses.

Notwithstanding the first paragraph, the amount that may be renounced by the corporation must not in any case exceed

(a)  the amount by which the consideration for the share exceeds the aggregate of other amounts renounced under this section or section 359.2.1 or 359.4 by the corporation in respect of the share on or before the day on which the renunciation is made; or

(b)  the amount by which the cumulative Canadian exploration expense of the corporation on the effective date of the renunciation computed before taking into account any amounts renounced by the corporation under this section on the date on which the renunciation is made, exceeds the aggregate of all amounts renounced by the corporation under this section in respect of any other share on the date on which the renunciation is made, and effective on or before the effective date of the renunciation.

1988, c. 18, s. 27; 1995, c. 49, s. 83; 1997, c. 3, s. 71; 1998, c. 16, s. 121; 2015, c. 24, s. 61; 2023, c. 19, s. 27.

2015-10-26

359.2. Where a person gave consideration under an agreement to a corporation for the issue of a flow-through share of the corporation and, in the period that begins on the day the agreement was entered into and ends 24 months after the end of the month that includes that day, the corporation incurred Canadian exploration expenses (other than expenses deemed to be Canadian exploration expenses of the corporation under the first paragraph of section 399.3), the corporation may, after it complies with section 359.10 in respect of the share and before 1 March of the first calendar year that begins after that period, renounce to the person in respect of the share the amount by which the part of those expenses incurred by it on or before the effective date of the renunciation, which part is in this section referred to as the “specified expenses”, exceeds the aggregate of

(a)  the assistance that the corporation has received, is entitled to receive, or may reasonably expect to receive at any time, and that can reasonably be related to the specified expenses or to Canadian exploration activities to which the specified expenses relate, other than assistance that can reasonably be related to expenses referred to in subparagraph b or b.1;

(b)  all specified expenses that are prescribed Canadian exploration and development overhead expenses of the corporation;

(b.1)  all specified expenses each of which is a cost of, or for the use of, seismic data

i.  that had been acquired, otherwise than as a consequence of performing work that resulted in the creation of the data, by any other person before the cost was incurred,

ii.  in respect of which a right to use had been acquired by any other person before the cost was incurred, or

iii.  all or substantially all of which resulted from work performed more than one year before the cost was incurred; and

(c)  the aggregate of amounts that are renounced by the corporation on or before the date on which the renunciation is made by any other renunciation under this section in respect of those expenses.

Notwithstanding the first paragraph, the amount that may be renounced by the corporation must not in any case exceed

(a)  the amount by which the consideration for the share exceeds the aggregate of other amounts renounced under this section or section 359.2.1 or 359.4 by the corporation in respect of the share on or before the day on which the renunciation is made; or

(b)  the amount by which the cumulative Canadian exploration expense of the corporation on the effective date of the renunciation computed before taking into account any amounts renounced by the corporation under this section on the date on which the renunciation is made, exceeds the aggregate of all amounts renounced by the corporation under this section in respect of any other share on the date on which the renunciation is made, and effective on or before the effective date of the renunciation.

1988, c. 18, s. 27; 1995, c. 49, s. 83; 1997, c. 3, s. 71; 1998, c. 16, s. 121; 2015, c. 24, s. 61.

2006-03-01

359.2. Where a person gave consideration under an agreement to a corporation for the issue of a flow-through share of the corporation and, in the period that begins on the day the agreement was entered into and ends 24 months after the end of the month that includes that day, the corporation incurred Canadian exploration expenses, the corporation may, after it complies with section 359.10 in respect of the share and before 1 March of the first calendar year that begins after that period, renounce to the person in respect of the share the amount by which the part of those expenses incurred by it on or before the effective date of the renunciation, which part is in this section referred to as the “specified expenses”, exceeds the aggregate of

(a)  the assistance that the corporation has received, is entitled to receive, or may reasonably expect to receive at any time, and that can reasonably be related to the specified expenses or to Canadian exploration activities to which the specified expenses relate, other than assistance that can reasonably be related to expenses referred to in subparagraph b or b.1;

(b)  all specified expenses that are prescribed Canadian exploration and development overhead expenses of the corporation;

(b.1)  all specified expenses each of which is a cost of, or for the use of, seismic data

i.  that had been acquired, otherwise than as a consequence of performing work that resulted in the creation of the data, by any other person before the cost was incurred,

ii.  in respect of which a right to use had been acquired by any other person before the cost was incurred, or

iii.  all or substantially all of which resulted from work performed more than one year before the cost was incurred; and

(c)  the aggregate of amounts that are renounced by the corporation on or before the date on which the renunciation is made by any other renunciation under this section in respect of those expenses.

Notwithstanding the first paragraph, the amount that may be renounced by the corporation must not in any case exceed

(a)  the amount by which the consideration for the share exceeds the aggregate of other amounts renounced under this section or section 359.2.1 or 359.4 by the corporation in respect of the share on or before the day on which the renunciation is made; or

(b)  the amount by which the cumulative Canadian exploration expense of the corporation on the effective date of the renunciation computed before taking into account any amounts renounced by the corporation under this section on the date on which the renunciation is made, exceeds the aggregate of all amounts renounced by the corporation under this section in respect of any other share on the date on which the renunciation is made, and effective on or before the effective date of the renunciation.

1988, c. 18, s. 27; 1995, c. 49, s. 83; 1997, c. 3, s. 71; 1998, c. 16, s. 121.