I-3 - Taxation Act

Section 737.18.17.17 Disposition versions

2024-05-07

737.18.17.17. A qualified corporation that, in a particular taxation year, carries on activities arising from the carrying out of a large investment project or is a member of a qualified partnership that carries on such activities in its fiscal period ending in that year may, subject to the third paragraph, deduct in computing its taxable income for the particular year, if a certificate has been issued for the particular year or the fiscal period in relation to the large investment project, an amount equal to the lesser of the amount by which its adjusted taxable income for the particular year exceeds the amount it deducts in computing its taxable income under subparagraph b of the first paragraph of section 737.18.17.5 and the aggregate of the following amounts that is multiplied, where the corporation has an establishment situated outside Québec, by the reciprocal of the proportion that its business carried on in Québec is of the aggregate of its business carried on in Canada or in Québec and elsewhere, as determined under subsection 2 of section 771:

(a)  100/11.5 of the lesser of the amount determined in accordance with the first paragraph of section 737.18.17.18 in respect of the corporation for the particular year, in relation to one or more large investment projects of the corporation or of such a qualified partnership of which it is a member, and the amount determined in its respect for the particular year under the second paragraph; and

(b)  100/3.2 of the amount by which the amount determined in accordance with the first paragraph of section 737.18.17.18 in respect of the corporation for the particular year, in relation to one or more large investment projects of the corporation or of such a qualified partnership of which it is a member, exceeds the amount determined in its respect for the particular year under the second paragraph.

The amount to which subparagraphs a and b of the first paragraph refer for a particular taxation year is equal to

(a)  the amount by which the tax that would be determined, in respect of the corporation for the particular year, in accordance with subsection 1 of section 771, if its taxable income for the year were computed without reference to this section, exceeds 3.2% of the amount that would be determined in respect of the corporation for the particular year under section 771.2.1.2 if, for the purposes of paragraph b of that section, its taxable income for the year were computed without reference to this section; or

(b)  where the corporation has an establishment situated outside Québec for the particular year, the product obtained by multiplying the excess amount determined under subparagraph a by the proportion that its business carried on in Québec is of the aggregate of its business carried on in Canada or in Québec and elsewhere, as determined under subsection 2 of section 771 for that year.

A corporation may deduct an amount under the first paragraph in computing its taxable income for a taxation year only if it encloses, with the fiscal return it is required to file for the year under section 1000,

(a)  the prescribed form containing prescribed information; and

(b)  in relation to each large investment project referred to in the first paragraph of the corporation or of a partnership of which the corporation is a member,

i.  a copy of the qualification certificate issued to the corporation or partnership in respect of the large investment project,

ii.  a copy of the certificate issued for the corporation’s taxation year or the partnership’s fiscal period, as the case may be, in relation to the large investment project,

iii.  where the large investment project is such a project of the partnership, a copy of each agreement referred to in section 737.18.17.20 in respect of the partnership’s fiscal period that ends in the taxation year or in a preceding taxation year, in relation to the project, unless it has already been filed,

iv.  where the corporation or partnership acquired or sold all or substantially all of the activities arising from the carrying out of the large investment project, a copy of the agreement referred to in section 737.18.17.21 in respect of the transfer, unless it has already been filed, and

v.  a copy of the independent auditor’s report that the corporation or partnership enclosed with the application for the first certificate relating to the large investment project.

2024, c. 11, s. 71.