I-3 - Taxation Act

Section 105.2.1 Disposition versions

2019-06-19

105.2.1. (Repealed).

2003, c. 2, s. 39; 2004, c. 21, s. 54; 2005, c. 1, s. 37; 2007, c. 12, s. 35; 2017, c. 29, s. 31; 2019, c. 14, s. 78.

2017-12-07

105.2.1. A taxpayer may, in the taxpayer’s fiscal return filed for a taxation year in accordance with section 1000, or with an election under section 502 filed on or before the taxpayer’s filing-due date for the year, elect to have the rules set out in the second paragraph apply to a disposition made at any time in the year of a property that is an incorporeal capital property in respect of a business, if

(a)  the taxpayer’s actual proceeds of disposition exceed the incorporeal capital amount in respect of the acquisition of the property;

(b)  that incorporeal capital amount can be determined; and

(c)  for a taxpayer who is an individual, the taxpayer’s exempt gains balance in respect of the business for the year determined in accordance with section 107.2 is nil.

The rules to which the first paragraph refers are the following:

(a)  for the purposes of section 107, excluding the amount determined under subparagraph a of the first paragraph of section 107, the proceeds of disposition of the property are deemed to be equal to that incorporeal capital amount;

(b)  the taxpayer is deemed to have disposed at that time of a capital property that had, immediately before that time, an adjusted cost base to the taxpayer equal to that incorporeal capital amount, for proceeds of disposition equal to the actual proceeds referred to in subparagraph a of the first paragraph; and

(c)  where the incorporeal capital property is at that time a qualified farm or fishing property (within the meaning assigned by section 726.6) of the taxpayer, the capital property deemed to have been disposed of by the taxpayer as a consequence of the application of subparagraph b is deemed to be a qualified farm or fishing property of the taxpayer at that time.

2003, c. 2, s. 39; 2004, c. 21, s. 54; 2005, c. 1, s. 37; 2007, c. 12, s. 35; 2017, c. 29, s. 31.

2007-11-07

105.2.1. A taxpayer may, in the taxpayer’s fiscal return filed for a taxation year in accordance with section 1000, or with an election under section 502 filed on or before the taxpayer’s filing-due date for the year, elect to have the rules set out in the second paragraph apply to a disposition made at any time in the year of a property that is an incorporeal capital property in respect of a business, if

(a)  the taxpayer’s actual proceeds of disposition exceed the incorporeal capital amount in respect of the acquisition of the property;

(b)  that incorporeal capital amount can be determined; and

(c)  for a taxpayer who is an individual, the taxpayer’s exempt gains balance in respect of the business for the year determined in accordance with section 107.2 is nil.

The rules to which the first paragraph refers are the following:

(a)  for the purposes of section 107, excluding the amount determined under subparagraph a of the first paragraph of section 107, the proceeds of disposition of the property are deemed to be equal to that incorporeal capital amount;

(b)  the taxpayer is deemed to have disposed at that time of a capital property that had, immediately before that time, an adjusted cost base to the taxpayer equal to that incorporeal capital amount, for proceeds of disposition equal to the actual proceeds referred to in subparagraph a of the first paragraph; and

(c)  where the incorporeal capital property is at that time a qualified farm property or a qualified fishing property of the taxpayer, within the meaning assigned to those expressions by section 726.6, the capital property deemed to have been disposed of by the taxpayer as a consequence of the application of subparagraph b is deemed to be at that time a qualified farm property or a qualified fishing property of the taxpayer.

2003, c. 2, s. 39; 2004, c. 21, s. 54; 2005, c. 1, s. 37; 2007, c. 12, s. 35.

2006-03-01

105.2.1. The rules provided for in the second paragraph apply where, at any time in a taxation year, a taxpayer disposes of a property that is an incorporeal capital property, other than goodwill, in respect of a business and where

(a)  the cost of the property to the taxpayer can be determined;

(b)  the proceeds of the disposition, in this section referred to as the “actual proceeds”, exceed the cost of the property;

(c)  the taxpayer’s exempt gains balance in respect of the business for the year determined in accordance with section 107.2 is nil; and

(d)  the taxpayer so elects under this section in the taxpayer’s fiscal return filed for the year in accordance with section 1000.

The rules to which the first paragraph refers are the following:

(a)  for the purposes of section 107, the proceeds of disposition of the property are deemed to be equal to its cost;

(b)  the taxpayer is deemed to have disposed at that time, for proceeds of disposition equal to the actual proceeds, of a capital property that has at that time an adjusted cost base to the taxpayer equal to the cost of the property; and

(c)  where the incorporeal capital property is at that time a qualified farm property or a qualified fishing property of the taxpayer, within the meaning assigned to those expressions by section 726.6, the capital property deemed to have been disposed of by the taxpayer as a consequence of the application of subparagraph b is deemed to be at that time a qualified farm property or a qualified fishing property of the taxpayer.

2003, c. 2, s. 39; 2004, c. 21, s. 54; 2005, c. 1, s. 37.