I-3 - Taxation Act

Section 851.22.26 Disposition versions

2006-03-01

851.22.26. Where a taxpayer that was a financial institution in a taxation year of the taxpayer that includes 23 February 1994 held, on that day, a specified debt obligation, other than a mark-to-market property for the year, that was inventory of the taxpayer at the end of its preceding taxation year,

(a)  the taxpayer is deemed to have disposed of the property at the beginning of the year for proceeds equal to

i.  where subparagraph ii does not apply, the amount at which the property was valued at the end of the preceding taxation year for the purpose of computing the taxpayer’s income for that year, and

ii.  where the taxpayer is a bank and the property is prescribed property for the year, the cost of the property to the taxpayer, determined without reference to paragraph b;

(b)  for the purpose of determining the taxpayer’s profit or loss from the disposition, the cost of the property to the taxpayer is deemed to be the amount referred to in subparagraph i of paragraph a; and

(c)  the taxpayer is deemed to have reacquired the property, immediately after the beginning of the year, at a cost equal to the proceeds of disposition of the property.

1996, c. 39, s. 235.