I-3 - Taxation Act

Section 737.18.18 Disposition versions

2022-06-08

737.18.18. (Repealed).

2002, c. 40, s. 60; 2003, c. 9, s. 55; 2004, c. 21, s. 145; 2006, c. 13, s. 55; 2009, c. 5, s. 255; 2009, c. 15, s. 131; 2011, c. 1, s. 35; 2022, c. 23, s. 53.

2011-02-17

737.18.18. In this Title,

“associated group” in a taxation year has the meaning assigned by section 737.18.20;

“eligible activity” of a corporation for a taxation year means a manufacturing or processing activity, other than an excluded activity, and includes the following activities where they are incidental to the manufacturing or processing activity:

(a)  engineering design of products and production facilities;

(b)  receiving and storing of raw materials;

(c)  producing, assembling and handling of goods in process;

(d)  inspecting and packaging of finished goods;

(e)  line supervision;

(f)  production support activities including security, cleaning, heating and factory maintenance;

(g)  quality and production control;

(h)  repair of production facilities;

(i)  pollution control; and

(j)  the installation of a property by the corporation, where the property is the result of the manufacturing or processing activity carried out by the corporation or a corporation to which it is associated;

“eligible cost” of a qualified property to a corporation for a taxation year means

(a)  where the property is referred to in paragraph a of the definition of “qualified property”, 10% of the capital cost of the property to the corporation; or

(b)  where the property is referred to in paragraph b of the definition of “qualified property”, the rental expenses incurred by the corporation in the year in respect of the property;

“eligible employee” of a corporation for a pay period within a taxation year means an employee of the corporation who, during that period, reports for work at an establishment of the corporation situated in an eligible region;

“eligible region” means

(a)  one of the following administrative regions described in the Décret concernant la révision des limites des régions administratives du Québec (chapter D-11, r. 1):

i.  administrative region 01 Bas-Saint-Laurent,

ii.  administrative region 02 Saguenay–Lac-Saint-Jean,

iii.  administrative region 08 Abitibi-Témiscamingue,

iv.  administrative region 09 Côte-Nord,

v.  administrative region 10 Nord-du-Québec, or

vi.  administrative region 11 Gaspésie–Îles-de-la-Madeleine;

(b)  one of the following regional county municipalities:

i.  Municipalité régionale de comté d’Antoine-Labelle,

ii.  (subparagraph repealed);

iii.  Municipalité régionale de comté de La Vallée-de-la-Gatineau,

iv.  Municipalité régionale de comté de Mékinac, or

v.  Municipalité régionale de comté de Pontiac; or

(c)  the urban agglomeration of La Tuque, as described in section 8 of the Act respecting the exercise of certain municipal powers in certain urban agglomerations (chapter E-20.001);

“excluded activity” for a taxation year means

(a)  farming, fishing or forestry;

(b)  construction;

(c)  operating an oil or gas well or extracting petroleum or natural gas from a natural accumulation of petroleum or natural gas;

(d)  extracting minerals from a mineral resource;

(e)  processing

i.  ore, other than iron ore or tar sands ore, from a mineral resource to any stage that is not beyond the prime metal stage or its equivalent,

ii.  iron ore from a mineral resource to any stage that is not beyond the pellet stage or its equivalent,

iii.  tar sands ore from a mineral resource to any stage that is not beyond the crude oil stage or its equivalent,

iv.  producing industrial minerals, other than sulfur obtained by processing natural gas,

v.  processing natural gas by a public utility as part of the business of selling or distributing gas, or

vi.  processing, in Canada, heavy crude oil recovered from a natural reservoir in Canada to a stage that is not beyond the crude oil stage or its equivalent;

(f)  storing, shipping, selling and leasing of finished goods;

(g)  purchasing of raw materials;

(h)  administration, including clerical and personnel activities;

(i)  purchase and resale operations;

(j)  data processing; or

(k)  providing facilities for employees, including cafeterias, clinics and recreational facilities;

(l)  photographic development undertaken in a laboratory;

(m)  an activity engaged in as part of the operation of a service sector business in relation in particular to transportation or storage, administrative or financial services, wholesale or retail trade, lodging or restaurant services, including any preparation of meals or beverages ordered by customers for immediate consumption on the premises or outside the establishment where the meals or beverages are prepared, or personal services;

(n)  (paragraph repealed);

(o)  (paragraph repealed);

(p)  (paragraph repealed);

(q)  (paragraph repealed);

“excluded corporation” for a taxation year means a corporation

(a)  that is exempt from tax under Book VIII; or

(b)  that would be exempt from tax under section 985 but for section 192;

“exemption period” applicable to a qualified corporation means the period that begins on 30 March 2001 and that ends on 31 December 2010;

“qualified corporation” for a taxation year means, subject to sections 737.18.22 and 737.18.23, a corporation, other than an excluded corporation,

(a)  all or substantially all the total payroll of which for the year is attributable to employees of the corporation in respect of pay periods within the year for which the employees qualify as eligible employees of the corporation;

(b)  the activities of which consist mainly in carrying on a manufacturing or processing business; and

(c)  the paid-up capital attributed to the corporation for the year, determined in accordance with section 737.18.24, is less than $30,000,000;

“qualified property” of a corporation for a taxation year means

(a)  depreciable property owned by the corporation at the end of the year and used by the corporation at any time in the year; or

(b)  property leased by the corporation in the year and that would be property referred to in paragraph a if it were owned by the corporation at the end of the year;

“qualified salary or wages” of a corporation for a taxation year, in respect of an employee of the corporation for the year, means the lesser of

(a)  the amount obtained by multiplying $125,000 by the proportion that the number of days in the taxation year during which the employee works for the corporation is of 365; and

(b)  the salary or wages incurred by the corporation in the taxation year in respect of the employee;

“qualified total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the qualified salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year;

“reduction factor” of a qualified corporation for a taxation year means the reduction factor specified in the qualification certificate issued by Investissement Québec to the qualified corporation for the year for the purposes of this Title or, in the absence of such a specification, zero;

“total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year.

For the purposes of the definition of “eligible employee” in the first paragraph,

(a)  where, during a pay period within a taxation year, an employee reports for work at an establishment of a corporation situated in an eligible region and at an establishment of the corporation situated outside that region, the employee is, for that period, deemed

i.  except if subparagraph ii applies, to report for work only at the establishment situated in the eligible region, and

ii.  to report for work only at the establishment situated outside the eligible region if, during that period, the employee reports for work mainly at an establishment of the corporation situated outside the eligible region; and

(b)  where, during a pay period within a taxation year, an employee is not required to report for work at an establishment of a corporation and the employee’s salary or wages are paid from such an establishment situated in an eligible region, the employee is deemed to report for work at that establishment if the duties performed by the employee during that period are performed mainly in the eligible region.

2002, c. 40, s. 60; 2003, c. 9, s. 55; 2004, c. 21, s. 145; 2006, c. 13, s. 55; 2009, c. 5, s. 255; 2009, c. 15, s. 131; 2011, c. 1, s. 35.

2009-06-04

737.18.18. In this Title,

“associated group” in a taxation year has the meaning assigned by section 737.18.20;

“eligible activity” of a corporation for a taxation year means a manufacturing or processing activity, other than an excluded activity, and includes the following activities where they are incidental to the manufacturing or processing activity:

(a)  engineering design of products and production facilities;

(b)  receiving and storing of raw materials;

(c)  producing, assembling and handling of goods in process;

(d)  inspecting and packaging of finished goods;

(e)  line supervision;

(f)  production support activities including security, cleaning, heating and factory maintenance;

(g)  quality and production control;

(h)  repair of production facilities;

(i)  pollution control; and

(j)  the installation of a property by the corporation, where the property is the result of the manufacturing or processing activity carried out by the corporation or a corporation to which it is associated;

“eligible cost” of a qualified property to a corporation for a taxation year means

(a)  where the property is referred to in paragraph a of the definition of “qualified property”, 10% of the capital cost of the property to the corporation; or

(b)  where the property is referred to in paragraph b of the definition of “qualified property”, the rental expenses incurred by the corporation in the year in respect of the property;

“eligible employee” of a corporation for a pay period within a taxation year means an employee of the corporation who, during that period, reports for work at an establishment of the corporation situated in an eligible region;

“eligible region” means

(a)  one of the following administrative regions:

i.  administrative region 01 Bas-Saint-Laurent,

ii.  administrative region 02 Saguenay–Lac-Saint-Jean,

iii.  administrative region 08 Abitibi-Témiscamingue,

iv.  administrative region 09 Côte-Nord,

v.  administrative region 10 Nord-du-Québec, or

vi.  administrative region 11 Gaspésie–Îles-de-la-Madeleine;

(b)  one of the following regional county municipalities:

i.  Municipalité régionale de comté d’Antoine-Labelle,

ii.  (subparagraph repealed);

iii.  Municipalité régionale de comté de La Vallée-de-la-Gatineau,

iv.  Municipalité régionale de comté de Mékinac, or

v.  Municipalité régionale de comté de Pontiac; or

(c)  the urban agglomeration of La Tuque, as described in section 8 of the Act respecting the exercise of certain municipal powers in certain urban agglomerations (chapter E-20.001);

“excluded activity” for a taxation year means

(a)  farming, fishing or forestry;

(b)  construction;

(c)  operating an oil or gas well or extracting petroleum or natural gas from a natural accumulation of petroleum or natural gas;

(d)  extracting minerals from a mineral resource;

(e)  processing

i.  ore, other than iron ore or tar sands ore, from a mineral resource to any stage that is not beyond the prime metal stage or its equivalent,

ii.  iron ore from a mineral resource to any stage that is not beyond the pellet stage or its equivalent,

iii.  tar sands ore from a mineral resource to any stage that is not beyond the crude oil stage or its equivalent,

iv.  producing industrial minerals, other than sulfur obtained by processing natural gas,

v.  processing natural gas by a public utility as part of the business of selling or distributing gas, or

vi.  processing, in Canada, heavy crude oil recovered from a natural reservoir in Canada to a stage that is not beyond the crude oil stage or its equivalent;

(f)  storing, shipping, selling and leasing of finished goods;

(g)  purchasing of raw materials;

(h)  administration, including clerical and personnel activities;

(i)  purchase and resale operations;

(j)  data processing; or

(k)  providing facilities for employees, including cafeterias, clinics and recreational facilities;

(l)  photographic development undertaken in a laboratory;

(m)  an activity engaged in as part of the operation of a service sector business in relation in particular to transportation or storage, administrative or financial services, wholesale or retail trade, lodging or restaurant services, including any preparation of meals or beverages ordered by customers for immediate consumption on the premises or outside the establishment where the meals or beverages are prepared, or personal services;

(n)  (paragraph repealed);

(o)  (paragraph repealed);

(p)  (paragraph repealed);

(q)  (paragraph repealed);

“excluded corporation” for a taxation year means a corporation

(a)  that is exempt from tax under Book VIII; or

(b)  that would be exempt from tax under section 985 but for section 192;

“exemption period” applicable to a qualified corporation means the period that begins on 30 March 2001 and that ends on 31 December 2010;

“qualified corporation” for a taxation year means, subject to sections 737.18.22 and 737.18.23, a corporation, other than an excluded corporation,

(a)  all or substantially all the total payroll of which for the year is attributable to employees of the corporation in respect of pay periods within the year for which the employees qualify as eligible employees of the corporation;

(b)  the activities of which consist mainly in carrying on a manufacturing or processing business; and

(c)  the paid-up capital attributed to the corporation for the year, determined in accordance with section 737.18.24, is less than $30,000,000;

“qualified property” of a corporation for a taxation year means

(a)  depreciable property owned by the corporation at the end of the year and used by the corporation at any time in the year; or

(b)  property leased by the corporation in the year and that would be property referred to in paragraph a if it were owned by the corporation at the end of the year;

“qualified salary or wages” of a corporation for a taxation year, in respect of an employee of the corporation for the year, means the lesser of

(a)  the amount obtained by multiplying $125,000 by the proportion that the number of days in the taxation year during which the employee works for the corporation is of 365; and

(b)  the salary or wages incurred by the corporation in the taxation year in respect of the employee;

“qualified total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the qualified salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year;

“reduction factor” of a qualified corporation for a taxation year means the reduction factor specified in the qualification certificate issued by Investissement Québec to the qualified corporation for the year for the purposes of this Title or, in the absence of such a specification, zero;

“total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year.

For the purposes of the definition of “eligible employee” in the first paragraph,

(a)  where, during a pay period within a taxation year, an employee reports for work at an establishment of a corporation situated in an eligible region and at an establishment of the corporation situated outside that region, the employee is, for that period, deemed

i.  except if subparagraph ii applies, to report for work only at the establishment situated in the eligible region, and

ii.  to report for work only at the establishment situated outside the eligible region if, during that period, the employee reports for work mainly at an establishment of the corporation situated outside the eligible region; and

(b)  where, during a pay period within a taxation year, an employee is not required to report for work at an establishment of a corporation and the employee’s salary or wages are paid from such an establishment situated in an eligible region, the employee is deemed to report for work at that establishment if the duties performed by the employee during that period are performed mainly in the eligible region.

2002, c. 40, s. 60; 2003, c. 9, s. 55; 2004, c. 21, s. 145; 2006, c. 13, s. 55; 2009, c. 5, s. 255; 2009, c. 15, s. 131.

2009-05-15

737.18.18. In this Title,

“associated group” in a taxation year has the meaning assigned by section 737.18.20;

“eligible activity” of a corporation for a taxation year means a manufacturing or processing activity, other than an excluded activity, and includes the following activities where they are incidental to the manufacturing or processing activity:

(a)  engineering design of products and production facilities;

(b)  receiving and storing of raw materials;

(c)  producing, assembling and handling of goods in process;

(d)  inspecting and packaging of finished goods;

(e)  line supervision;

(f)  production support activities including security, cleaning, heating and factory maintenance;

(g)  quality and production control;

(h)  repair of production facilities;

(i)  pollution control; and

(j)  the installation of a property by the corporation, where the property is the result of the manufacturing or processing activity carried out by the corporation or a corporation to which it is associated;

“eligible cost” of a qualified property to a corporation for a taxation year means

(a)  where the property is referred to in paragraph a of the definition of “qualified property”, 10% of the capital cost of the property to the corporation; or

(b)  where the property is referred to in paragraph b of the definition of “qualified property”, the rental expenses incurred by the corporation in the year in respect of the property;

“eligible employee” of a corporation for a pay period within a taxation year means an employee of the corporation who, during that period, reports for work at an establishment of the corporation situated in an eligible region;

“eligible region” means

(a)  one of the following administrative regions:

i.  administrative region 01 Bas-Saint-Laurent,

ii.  administrative region 02 Saguenay–Lac-Saint-Jean,

iii.  administrative region 08 Abitibi-Témiscamingue,

iv.  administrative region 09 Côte-Nord,

v.  administrative region 10 Nord-du-Québec, or

vi.  administrative region 11 Gaspésie–Îles-de-la-Madeleine;

(b)  one of the following regional county municipalities:

i.  Municipalité régionale de comté d’Antoine-Labelle,

ii.  (subparagraph repealed);

iii.  Municipalité régionale de comté de La Vallée-de-la-Gatineau,

iv.  Municipalité régionale de comté de Mékinac, or

v.  Municipalité régionale de comté de Pontiac; or

(c)  the urban agglomeration of La Tuque, as described in section 8 of the Act respecting the exercise of certain municipal powers in certain urban agglomerations (chapter E-20.001);

“excluded activity” for a taxation year means

(a)  farming, fishing or forestry;

(b)  construction;

(c)  operating an oil or gas well or extracting petroleum or natural gas from a natural accumulation of petroleum or natural gas;

(d)  extracting minerals from a mineral resource;

(e)  processing

i.  ore, other than iron ore or tar sands ore, from a mineral resource to any stage that is not beyond the prime metal stage or its equivalent,

ii.  iron ore from a mineral resource to any stage that is not beyond the pellet stage or its equivalent,

iii.  tar sands ore from a mineral resource to any stage that is not beyond the crude oil stage or its equivalent,

iv.  producing industrial minerals, other than sulfur obtained by processing natural gas,

v.  processing natural gas by a public utility as part of the business of selling or distributing gas, or

vi.  processing, in Canada, heavy crude oil recovered from a natural reservoir in Canada to a stage that is not beyond the crude oil stage or its equivalent;

(f)  storing, shipping, selling and leasing of finished goods;

(g)  purchasing of raw materials;

(h)  administration, including clerical and personnel activities;

(i)  purchase and resale operations;

(j)  data processing; or

(k)  providing facilities for employees, including cafeterias, clinics and recreational facilities;

(l)  photographic development undertaken in a laboratory;

(m)  transportation and storage;

(n)  administrative and financial services;

(o)  wholesale or retail trade;

(p)  lodging or restaurant services, including any preparation of meals or beverages ordered by customers for immediate consumption on the premises or outside the establishment where the meals or beverages are prepared; or

(q)  services provided to a person or a partnership carrying on a business and personal services;

“excluded corporation” for a taxation year means a corporation

(a)  that is exempt from tax under Book VIII; or

(b)  that would be exempt from tax under section 985 but for section 192;

“exemption period” applicable to a qualified corporation means the period that begins on 30 March 2001 and that ends on 31 December 2010;

“qualified corporation” for a taxation year means, subject to sections 737.18.22 and 737.18.23, a corporation, other than an excluded corporation,

(a)  all or substantially all the total payroll of which for the year is attributable to employees of the corporation in respect of pay periods within the year for which the employees qualify as eligible employees of the corporation;

(b)  the activities of which consist mainly in carrying on a manufacturing or processing business; and

(c)  the paid-up capital attributed to the corporation for the year, determined in accordance with section 737.18.24, is less than $30,000,000;

“qualified property” of a corporation for a taxation year means

(a)  depreciable property owned by the corporation at the end of the year and used by the corporation at any time in the year; or

(b)  property leased by the corporation in the year and that would be property referred to in paragraph a if it were owned by the corporation at the end of the year;

“qualified salary or wages” of a corporation for a taxation year, in respect of an employee of the corporation for the year, means the lesser of

(a)  the amount obtained by multiplying $125,000 by the proportion that the number of days in the taxation year during which the employee works for the corporation is of 365; and

(b)  the salary or wages incurred by the corporation in the taxation year in respect of the employee;

“qualified total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the qualified salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year;

“reduction factor” of a qualified corporation for a taxation year means the reduction factor specified in the qualification certificate issued by Investissement Québec to the qualified corporation for the year for the purposes of this Title or, in the absence of such a specification, zero;

“total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year.

For the purposes of the definition of “eligible employee” in the first paragraph,

(a)  where, during a pay period within a taxation year, an employee reports for work at an establishment of a corporation situated in an eligible region and at an establishment of the corporation situated outside that region, the employee is, for that period, deemed

i.  except if subparagraph ii applies, to report for work only at the establishment situated in the eligible region, and

ii.  to report for work only at the establishment situated outside the eligible region if, during that period, the employee reports for work mainly at an establishment of the corporation situated outside the eligible region; and

(b)  where, during a pay period within a taxation year, an employee is not required to report for work at an establishment of a corporation and the employee’s salary or wages are paid from such an establishment situated in an eligible region, the employee is deemed to report for work at that establishment if the duties performed by the employee during that period are performed mainly in the eligible region.

2002, c. 40, s. 60; 2003, c. 9, s. 55; 2004, c. 21, s. 145; 2006, c. 13, s. 55; 2009, c. 5, s. 255.

2006-06-13

737.18.18. In this Title,

“associated group” in a taxation year has the meaning assigned by section 737.18.20;

“eligible activity” of a corporation for a taxation year means a manufacturing or processing activity, other than an excluded activity, and includes the following activities where they are incidental to the manufacturing or processing activity:

(a)  engineering design of products and production facilities;

(b)  receiving and storing of raw materials;

(c)  producing, assembling and handling of goods in process;

(d)  inspecting and packaging of finished goods;

(e)  line supervision;

(f)  production support activities including security, cleaning, heating and factory maintenance;

(g)  quality and production control;

(h)  repair of production facilities;

(i)  pollution control; and

(j)  the installation of a property by the corporation, where the property is the result of the manufacturing or processing activity carried out by the corporation or a corporation to which it is associated;

“eligible cost” of a qualified property to a corporation for a taxation year means

(a)  where the property is referred to in paragraph a of the definition of “qualified property”, 10% of the capital cost of the property to the corporation; or

(b)  where the property is referred to in paragraph b of the definition of “qualified property”, the rental expenses incurred by the corporation in the year in respect of the property;

“eligible employee” of a corporation for a pay period within a taxation year means an employee of the corporation who, during that period, reports for work at an establishment of the corporation situated in an eligible region;

“eligible region” means

(a)  one of the following administrative regions:

i.  administrative region 01 Bas-Saint-Laurent,

ii.  administrative region 02 Saguenay–Lac-Saint-Jean,

iii.  administrative region 08 Abitibi-Témiscamingue,

iv.  administrative region 09 Côte-Nord,

v.  administrative region 10 Nord-du-Québec, or

vi.  administrative region 11 Gaspésie–Îles-de-la-Madeleine;

(b)  one of the following regional county municipalities:

i.  Municipalité régionale de comté d’Antoine-Labelle,

ii.  (subparagraph repealed);

iii.  Municipalité régionale de comté de La Vallée-de-la-Gatineau,

iv.  Municipalité régionale de comté de Mékinac, or

v.  Municipalité régionale de comté de Pontiac; or

(c)  the urban agglomeration of La Tuque, as described in section 8 of the Act respecting the exercise of certain municipal powers in certain urban agglomerations (chapter E-20.001);

“excluded activity” for a taxation year means

(a)  farming, fishing or forestry;

(b)  construction;

(c)  operating an oil or gas well or extracting petroleum or natural gas from a natural accumulation of petroleum or natural gas;

(d)  extracting minerals from a mineral resource;

(e)  processing

i.  ore, other than iron ore or tar sands ore, from a mineral resource to any stage that is not beyond the prime metal stage or its equivalent,

ii.  iron ore from a mineral resource to any stage that is not beyond the pellet stage or its equivalent,

iii.  tar sands ore from a mineral resource to any stage that is not beyond the crude oil stage or its equivalent,

iv.  producing industrial minerals, other than sulfur obtained by processing natural gas,

v.  processing natural gas by a public utility as part of the business of selling or distributing gas, or

vi.  processing, in Canada, heavy crude oil recovered from a natural reservoir in Canada to a stage that is not beyond the crude oil stage or its equivalent;

(f)  storing, shipping, selling and leasing of finished goods;

(g)  purchasing of raw materials;

(h)  administration, including clerical and personnel activities;

(i)  purchase and resale operations;

(j)  data processing; or

(k)  providing facilities for employees, including cafeterias, clinics and recreational facilities;

(l)  photographic development undertaken in a laboratory;

(m)  transportation and storage;

(n)  administrative and financial services;

(o)  wholesale or retail trade;

(p)  lodging or restaurant services, including any preparation of meals or beverages ordered by customers for immediate consumption on the premises or outside the establishment where the meals or beverages are prepared; or

(q)  services provided to a person or a partnership carrying on a business and personal services;

“excluded corporation” for a taxation year means a corporation

(a)  that is exempt from tax under Book VIII; or

(b)  that would be exempt from tax under section 985 but for section 192;

“exemption period” applicable to a qualified corporation means the period that begins on 30 March 2001 and that ends on 31 December 2010;

“qualified corporation” for a taxation year means, subject to sections 737.18.22 and 737.18.23, a corporation, other than an excluded corporation,

(a)  all or substantially all the total payroll of which for the year is attributable to employees of the corporation in respect of pay periods within the year for which the employees qualify as eligible employees of the corporation;

(b)  the activities of which consist mainly in carrying on a manufacturing or processing business; and

(c)  the paid-up capital attributed to the corporation for the year, determined in accordance with section 737.18.24, is less than $30,000,000;

“qualified property” of a corporation for a taxation year means

(a)  depreciable property owned by the corporation at the end of the year and used by the corporation at any time in the year; or

(b)  property leased by the corporation in the year and that would be property referred to in paragraph a if it were owned by the corporation at the end of the year;

“qualified salary or wages” of a corporation for a taxation year, in respect of an employee of the corporation for the year, means the lesser of

(a)  the amount obtained by multiplying $125,000 by the proportion that the number of days in the taxation year during which the employee works for the corporation is of 365; and

(b)  the salary or wages incurred by the corporation in the taxation year in respect of the employee;

“qualified total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the qualified salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year;

“total payroll” of a corporation for a taxation year means the aggregate of all amounts each of which is the salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year.

For the purposes of the definition of “eligible employee” in the first paragraph,

(a)  where, during a pay period within a taxation year, an employee reports for work at an establishment of a corporation situated in an eligible region and at an establishment of the corporation situated outside that region, the employee is, for that period, deemed

i.  except if subparagraph ii applies, to report for work only at the establishment situated in the eligible region, and

ii.  to report for work only at the establishment situated outside the eligible region if, during that period, the employee reports for work mainly at an establishment of the corporation situated outside the eligible region; and

(b)  where, during a pay period within a taxation year, an employee is not required to report for work at an establishment of a corporation and the employee’s salary or wages are paid from such an establishment situated in an eligible region, the employee is deemed to report for work at that establishment if the duties performed by the employee during that period are performed mainly in the eligible region.

2002, c. 40, s. 60; 2003, c. 9, s. 55; 2004, c. 21, s. 145; 2006, c. 13, s. 55.

2006-03-01

737.18.18. In this Title,

"associated group" in a taxation year has the meaning assigned by section 737.18.20;

"eligible activity" of a corporation for a taxation year means a manufacturing or processing activity, other than an excluded activity, and includes the following activities where they are incidental to the manufacturing or processing activity:

(a)  engineering design of products and production facilities;

(b)  receiving and storing of raw materials;

(c)  producing, assembling and handling of goods in process;

(d)  inspecting and packaging of finished goods;

(e)  line supervision;

(f)  production support activities including security, cleaning, heating and factory maintenance;

(g)  quality and production control;

(h)  repair of production facilities;

(i)  pollution control; and

(j)  the installation of a property by the corporation, where the property is the result of the manufacturing or processing activity carried out by the corporation or a corporation to which it is associated;

"eligible cost" of a qualified property to a corporation for a taxation year means

(a)  where the property is referred to in paragraph a of the definition of "qualified property", 10% of the capital cost of the property to the corporation; or

(b)  where the property is referred to in paragraph b of the definition of "qualified property", the rental expenses incurred by the corporation in the year in respect of the property;

"eligible employee" of a corporation for a pay period within a taxation year means an employee of the corporation who, during that period, reports for work at an establishment of the corporation situated in an eligible region;

"eligible region" means

(a)  one of the following administrative regions:

i.  administrative region 01 Bas-Saint-Laurent,

ii.  administrative region 02 Saguenay-Lac-Saint-Jean,

iii.  administrative region 08 Abitibi-Témiscamingue,

iv.  administrative region 09 Côte-Nord,

v.  administrative region 10 Nord-du-Québec, or

vi.  administrative region 11 Gaspésie-Îles-de-la-Madeleine; or

(b)  one of the following regional county municipalities:

i.  Municipalité régionale de comté d’Antoine-Labelle,

ii.  Municipalité régionale de comté du Haut-Saint-Maurice,

iii.  Municipalité régionale de comté de La Vallée-de-la-Gatineau,

iv.  Municipalité régionale de comté de Mékinac, or

v.  Municipalité régionale de comté de Pontiac;

"excluded activity" for a taxation year means

(a)  farming, fishing or forestry;

(b)  construction;

(c)  operating an oil or gas well or extracting petroleum or natural gas from a natural accumulation of petroleum or natural gas;

(d)  extracting minerals from a mineral resource;

(e)  processing

i.  ore, other than iron ore or tar sands ore, from a mineral resource to any stage that is not beyond the prime metal stage or its equivalent,

ii.  iron ore from a mineral resource to any stage that is not beyond the pellet stage or its equivalent,

iii.  tar sands ore from a mineral resource to any stage that is not beyond the crude oil stage or its equivalent,

iv.  producing industrial minerals, other than sulfur obtained by processing natural gas,

v.  processing natural gas by a public utility as part of the business of selling or distributing gas, or

vi.  processing, in Canada, heavy crude oil recovered from a natural reservoir in Canada to a stage that is not beyond the crude oil stage or its equivalent;

(f)  storing, shipping, selling and leasing of finished goods;

(g)  purchasing of raw materials;

(h)  administration, including clerical and personnel activities;

(i)  purchase and resale operations;

(j)  data processing; or

(k)  providing facilities for employees, including cafeterias, clinics and recreational facilities;

(l)  photographic development undertaken in a laboratory;

(m)  transportation and storage;

(n)  administrative and financial services;

(o)  wholesale or retail trade;

(p)  lodging or restaurant services, including any preparation of meals or beverages ordered by customers for immediate consumption on the premises or outside the establishment where the meals or beverages are prepared; or

(q)  services provided to a person or a partnership carrying on a business and personal services;

"excluded corporation" for a taxation year means a corporation

(a)  that is exempt from tax under Book VIII; or

(b)  that would be exempt from tax under section 985 but for section 192;

"exemption period" applicable to a qualified corporation means the period that begins on 30 March 2001 and that ends on 31 December 2010;

"qualified corporation" for a taxation year means, subject to sections 737.18.22 and 737.18.23, a corporation, other than an excluded corporation,

(a)  all or substantially all the total payroll of which for the year is attributable to employees of the corporation in respect of pay periods within the year for which the employees qualify as eligible employees of the corporation;

(b)  the activities of which consist mainly in carrying on a manufacturing or processing business; and

(c)  the paid-up capital attributed to the corporation for the year, determined in accordance with section 737.18.24, is less than $30,000,000;

"qualified property" of a corporation for a taxation year means

(a)  depreciable property owned by the corporation at the end of the year and used by the corporation at any time in the year; or

(b)  property leased by the corporation in the year and that would be property referred to in paragraph a if it were owned by the corporation at the end of the year;

"qualified salary or wages" of a corporation for a taxation year, in respect of an employee of the corporation for the year, means the lesser of

(a)  the amount obtained by multiplying $125,000 by the proportion that the number of days in the taxation year during which the employee works for the corporation is of 365; and

(b)  the salary or wages incurred by the corporation in the taxation year in respect of the employee;

"qualified total payroll" of a corporation for a taxation year means the aggregate of all amounts each of which is the qualified salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year;

"total payroll" of a corporation for a taxation year means the aggregate of all amounts each of which is the salary or wages incurred by the corporation in the year in respect of an employee of the corporation for the year.

For the purposes of the definition of "eligible employee" in the first paragraph,

(a)  where, during a pay period within a taxation year, an employee reports for work at an establishment of a corporation situated in an eligible region and at an establishment of the corporation situated outside that region, the employee is, for that period, deemed

i.  except if subparagraph ii applies, to report for work only at the establishment situated in the eligible region, and

ii.  to report for work only at the establishment situated outside the eligible region if, during that period, the employee reports for work mainly at an establishment of the corporation situated outside the eligible region; and

(b)  where, during a pay period within a taxation year, an employee is not required to report for work at an establishment of a corporation and the employee’s salary or wages are paid from such an establishment situated in an eligible region, the employee is deemed to report for work at that establishment if the duties performed by the employee during that period are performed mainly in the eligible region.

2002, c. 40, s. 60; 2003, c. 9, s. 55; 2004, c. 21, s. 145.