I-3 - Taxation Act

Section 487.5 Disposition versions

2006-03-01

487.5. Sections 487.1 and 487.3 do not apply in respect of a debt or the portion of a debt

(a)  that is included in computing the income of a person or partnership under this Part; or

(b)  on which the interest is paid or payable to the creditor only by the debtor and in respect of which the rate of interest is not lower than the rate which, in view of the circumstances and the terms and conditions of the debt, would have been agreed upon, when the debt was contracted, between the parties who were dealing at arm’s length, if the loan of money had been part of the creditor’s normal business and if neither of the parties contracted the debt by virtue of an office or employment, or by virtue of the fact that a person or partnership is a shareholder.

1983, c. 44, s. 26; 1997, c. 3, s. 71.