I-3 - Taxation Act

Section 1175.36 Disposition versions

2006-03-01

1175.36. In this Part, the net value of the assets forming part of a system, determined in respect of an operator for a particular fiscal period, means the aggregate of all amounts each of which is

(a)  the excess amount, as shown in the operator’s financial statements prepared for the particular fiscal period, that is the amount by which the cost of an immovable subject to tax that is included in the system of the operator and of which the operator is the owner at the end of the particular fiscal period exceeds the accumulated depreciation;

(b)  unless subparagraph c applies, the amount determined by the following formula in respect of an immovable subject to tax that is included in the system of the operator and of which the operator is the lessee at any time in the particular fiscal period:

(A × 10) 365 / B; or

(c)  the excess amount, as shown in the operator’s financial statements prepared for the operator’s last fiscal period that ends in the calendar year in which the particular fiscal period ends, that is the amount by which the cost to the owner of an immovable subject to tax that is included in the system of the operator and of which the operator is the lessee at any time in the particular fiscal period exceeds the accumulated depreciation, where the owner is the lessor of the immovable subject to tax, in relation to the operator, and the owner and operator were not dealing with each other at arm’s length at the time the operator became the lessee of the immovable subject to tax or, if the owner is not the lessor of the immovable subject to tax, in relation to the operator, where each person or partnership that is a lessor of the immovable subject to tax, in relation to a lessee, and that lessee were not dealing with each other at arm’s length at the time the person or partnership became the lessor of the immovable subject to tax in relation to that lessee.

In the formula in subparagraph b of the first paragraph,

(a)  A is the portion of the rental cost of the immovable incurred in the particular fiscal period by the operator; and

(b)  B is the number of days in the particular fiscal period.

Subparagraphs b and c of the first paragraph do not apply in respect of an immovable subject to tax of which an operator is the lessee at any time in the operator’s last fiscal period that ends in a calendar year if that immovable is shown in the financial statements of another operator that is the owner of that immovable, prepared for that operator’s last fiscal period that ends in the calendar year.

For the purposes of this section, an operator who uses an immovable subject to tax in a capacity other than owner during the operator’s last fiscal period that ends in a calendar year is deemed to be the owner of that immovable subject to tax at the end of that fiscal period and is deemed not to be a lessee of that immovable subject to tax if that immovable constitutes an asset of the operator shown in the operator’s financial statements prepared for that fiscal period.

2005, c. 23, s. 261; 2005, c. 38, s. 335.