I-3 - Taxation Act

Section 359.8 Disposition versions

2015-10-26

359.8. Where a corporation that issues a flow-through share to a person under an agreement incurs, in a particular calendar year, Canadian exploration expenses or Canadian development expenses, the corporation is, for the purposes of section 359.2 or for the purposes of section 359.2.1 and paragraph b of section 359.2.2, as the case may be, deemed to have incurred the expenses on the last day of the preceding calendar year, provided that

(a)  the expenses

i.  are described in any of paragraphs a, b.1, c and c.2 of section 395 or paragraph a or a.1 of section 408,

ii.  would be described in paragraph d of section 395 if the reference in that paragraph to paragraphs a to b.1 and c to c.5 were read as a reference to paragraphs a, b.1, c and c.2 of that section, or

iii.  would be described in paragraph d of section 408 if the reference therein to paragraphs a to c were read as a reference to paragraphs a and a.1 of that section;

(a.1)  the agreement was entered into in the preceding calendar year;

(b)  the person paid the consideration for the share in money before the end of the preceding calendar year;

(c)  the corporation and the person deal with each other at arm’s length throughout the particular calendar year; and

(d)  in one of the first three months of the particular calendar year, the corporation renounces an amount in respect of the expenses to the person in respect of the share in accordance with section 359.2 or 359.2.1, as the case may be, and the effective date of the renunciation is the last day of the preceding calendar year.

1988, c. 18, s. 27; 1990, c. 59, s. 157; 1995, c. 49, s. 88; 1997, c. 3, s. 71; 1998, c. 16, s. 127; 2000, c. 5, s. 93; 2005, c. 1, s. 92; 2015, c. 24, s. 62.

2006-03-01

359.8. Where a corporation that issues a flow-through share to a person under an agreement incurs, in a particular calendar year, Canadian exploration expenses or Canadian development expenses, the corporation is, for the purposes of section 359.2 or for the purposes of section 359.2.1 and paragraph b of section 359.2.2, as the case may be, deemed to have incurred the expenses on the last day of the preceding calendar year, provided that

(a)  the expenses

i.  are described in any of paragraphs a, b.1, c and c.2 of section 395 or paragraph a or a.1 of section 408,

ii.  would be described in paragraph d of section 395 if the reference therein to paragraphs a to b.1 and c to c.2 were read as a reference to paragraphs a, b.1, c and c.2 of that section, or

iii.  would be described in paragraph d of section 408 if the reference therein to paragraphs a to c were read as a reference to paragraphs a and a.1 of that section;

(a.1)  the agreement was entered into in the preceding calendar year;

(b)  the person paid the consideration for the share in money before the end of the preceding calendar year;

(c)  the corporation and the person deal with each other at arm’s length throughout the particular calendar year; and

(d)  in one of the first three months of the particular calendar year, the corporation renounces an amount in respect of the expenses to the person in respect of the share in accordance with section 359.2 or 359.2.1, as the case may be, and the effective date of the renunciation is the last day of the preceding calendar year.

1988, c. 18, s. 27; 1990, c. 59, s. 157; 1995, c. 49, s. 88; 1997, c. 3, s. 71; 1998, c. 16, s. 127; 2000, c. 5, s. 93; 2005, c. 1, s. 92.