I-3 - Taxation Act

Section 525.1 Disposition versions

2021-06-04

525.1. Where section 518 applies in respect of the disposition of depreciable property of a prescribed class of a taxpayer that is a passenger vehicle to which paragraph d.3 of section 99 applies and the taxpayer and the corporation to which the property is disposed of do not deal with each other at arm’s length, the amount referred to in section 521.2 in respect of the property or, where section 522 applies thereto, the amount agreed on in respect of the property in the prescribed form, is deemed to be equal to the undepreciated capital cost to the taxpayer of the class immediately before the disposition, minus, where applicable, the amount deducted by the taxpayer under paragraph a of section 130 in respect of the passenger vehicle in computing the taxpayer’s income for the taxation year in which the passenger vehicle was disposed of by the taxpayer.

However, for the purposes of section 41.0.1, the cost to the corporation of the passenger vehicle is deemed to be an amount equal to its fair market value immediately before the disposition.

1990, c. 59, s. 191; 1997, c. 3, s. 71; 1997, c. 85, s. 92; 2021, c. 18, s. 46.

2006-03-01

525.1. Where property of a taxpayer in respect of the disposition of which section 518 applies is depreciable property of a prescribed class that is a passenger vehicle the cost to the taxpayer of which exceeds $20,000 or such other amount as may be prescribed for the purposes of paragraph d.3 of section 99, as the case may be, and the taxpayer and the corporation to which the property is disposed of do not deal with each other at arm’s length, the amount referred to in section 521.2 in respect of the property or, where section 522 applies thereto, the amount agreed on in respect of the property in the prescribed form, is deemed to be equal to the undepreciated capital cost to the taxpayer of the class immediately before the disposition, minus, where applicable, the amount deducted by the taxpayer under paragraph a of section 130 in respect of the passenger vehicle in computing the taxpayer’s income for the taxation year in which the passenger vehicle was disposed of by the taxpayer.

However, for the purposes of section 41.0.1, the cost to the corporation of the passenger vehicle is deemed to be an amount equal to its fair market value immediately before the disposition.

1990, c. 59, s. 191; 1997, c. 3, s. 71; 1997, c. 85, s. 92.