I-3 - Taxation Act

Section 771.2.1.3 Disposition versions

2019-06-19

771.2.1.3. In this Title, a corporation’s business limit for a taxation year is equal to $500,000 unless the corporation is associated in the year with one or more other Canadian-controlled private corporations in which case, except as otherwise provided in this Title, its business limit for the year is equal to zero.

For the purposes of the first paragraph and sections 771.2.1.4 to 771.2.1.8, the following rules apply:

(a)  section 21.21 does not apply to deem two corporations to be associated with each other at any time because they are associated, or deemed to be associated under section 21.21, at that time with the same corporation (in this paragraph referred to as the “third corporation”), if the third corporation is not a Canadian-controlled private corporation at that time or is a Canadian-controlled private corporation that has made a valid election under subsection 2 of section 256 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), in relation to its taxation year that includes that time; and

(b)  where the third corporation has made the valid election referred to in subparagraph a, its business limit for its taxation year that includes that time is deemed to be equal to zero.

Chapter V.2 of Title II of Book I applies in relation to an election made under subsection 2 of section 256 of the Income Tax Act or in relation to an election made under the second paragraph before 20 December 2006.

2005, c. 38, s. 173; 2009, c. 5, s. 313; 2010, c. 5, s. 68; 2019, c. 14, s. 244.

2010-04-20

771.2.1.3. In this Title, a corporation’s business limit for a taxation year is equal to $500,000 unless the corporation is associated in the year with one or more other Canadian-controlled private corporations in which case, except as otherwise provided in this Title, its business limit for the year is equal to zero.

For the purposes of the first paragraph and sections 771.2.1.4 to 771.2.1.8, if two corporations are deemed, under section 21.21, to be associated with each other at any time because they are associated, or deemed to be associated under section 21.21, at that time with the same corporation (in this paragraph referred to as the “third corporation”) and the third corporation is not a Canadian-controlled private corporation at that time or makes a valid election under subsection 2 of section 256 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) after 19 December 2006, in relation to its taxation year that includes that time, not to be associated with either of the other two corporations, the following rules apply:

(a)  the third corporation is deemed not to be associated with either of the other two corporations in that taxation year; and

(b)  the third corporation’s business limit for that taxation year is deemed to be equal to zero.

Chapter V.2 of Title II of Book I applies in relation to an election made under subsection 2 of section 256 of the Income Tax Act or in relation to an election made under the second paragraph before 20 December 2006.

2005, c. 38, s. 173; 2009, c. 5, s. 313; 2010, c. 5, s. 68.

2009-05-15

771.2.1.3. In this Title, a corporation’s business limit for a taxation year is equal to $400,000 unless the corporation is associated in the year with one or more other Canadian-controlled private corporations in which case, except as otherwise provided in this Title, its business limit for the year is equal to zero.

For the purposes of the first paragraph and sections 771.2.1.4 to 771.2.1.8, if two corporations are deemed, under section 21.21, to be associated with each other at any time because they are associated, or deemed to be associated under section 21.21, at that time with the same corporation (in this paragraph referred to as the “third corporation”) and the third corporation is not a Canadian-controlled private corporation at that time or makes a valid election under subsection 2 of section 256 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) after 19 December 2006, in relation to its taxation year that includes that time, not to be associated with either of the other two corporations, the following rules apply:

(a)  the third corporation is deemed not to be associated with either of the other two corporations in that taxation year; and

(b)  the third corporation’s business limit for that taxation year is deemed to be equal to zero.

Chapter V.2 of Title II of Book I applies in relation to an election made under subsection 2 of section 256 of the Income Tax Act or in relation to an election made under the second paragraph before 20 December 2006.

2005, c. 38, s. 173; 2009, c. 5, s. 313.

2006-03-01

771.2.1.3. In this Title, a corporation’s business limit for a taxation year is equal to $400,000 unless the corporation is associated in the year with one or more other Canadian-controlled private corporations in which case, except as otherwise provided in this Title, its business limit for the year is equal to zero.

For the purposes of the first paragraph and sections 771.2.1.4 to 771.2.1.8, if two corporations are deemed, under section 21.21, to be associated with each other at any time because they are associated, or deemed to be associated under section 21.21, at that time with the same corporation, in this paragraph referred to as the “third corporation”, and the third corporation is not a Canadian-controlled private corporation at that time or elects, in prescribed form, for its taxation year that includes that time not to be associated with either of the other two corporations, the following rules apply:

(a)  the third corporation is deemed not to be associated with either of the other two corporations in that taxation year; and

(b)  the third corporation’s business limit for that taxation year is deemed to be equal to zero.

2005, c. 38, s. 173.