R-5 - Act respecting the Régie de l’assurance maladie du Québec

Section 34.1.0.3.1 Disposition versions

2024-05-07

34.1.0.3.1. The aggregate of all amounts each of which is a contribution that, under subparagraph ii of subparagraph d.1 of the sixth paragraph of section 34, is not payable by an employer for a particular taxation year or fiscal period may not exceed the employer’s contribution holiday amount for the particular taxation year or fiscal period, as the case may be, in respect of one or more large investment projects of the employer that are referred to in that subparagraph d.1.

For the purposes of this section, an employer’s contribution holiday amount for a particular taxation year or fiscal period, in respect of one or more large investment projects of the employer, is equal to the aggregate of all amounts each of which is an amount that, for the particular taxation year or fiscal period, as the case may be, in relation to any of those large investment projects, is determined by the formula

(A × B/C) – D.

In the formula in the second paragraph,

(a)  A is the unused portion of the employer’s tax assistance limit, for the particular taxation year or fiscal period, in relation to the large investment project, that is determined under the fourth paragraph;

(b)  B is the number of days in the period that begins on the first day of the employer’s first taxation year, or first fiscal period, to which the computation method election applies, in relation to the large investment project, or, if it is later, on the date of the beginning of the tax-free period in respect of the project, and that ends on the earlier of

i.  the last day of the particular taxation year or fiscal period, and

ii.  the last day of the tax-free period in respect of the large investment project;

(c)  C is the number of days in the period that begins on the first day of the employer’s first taxation year, or first fiscal period, to which the computation method election applies, in relation to the large investment project, or, if it is later, on the date of the beginning of the tax-free period in respect of the project, and that ends on the last day of the tax-free period in respect of the project; and

(d)  D is the cumulative value of the employer’s tax assistance for the particular taxation year or fiscal period, in respect of the large investment project, that is determined under the fifth paragraph.

The unused portion of an employer’s tax assistance limit for a particular taxation year or fiscal period, in relation to a large investment project, is, subject to the eighth paragraph, either the amount (in this paragraph referred to as the “particular amount”) that would be the balance of the employer’s tax assistance limit in respect of the large investment project, determined in accordance with the third paragraph of section 34.1.0.3, for its first taxation year or its first fiscal period to which the computation method election in relation to the project applies (in this paragraph referred to, as the case may be, as the “first year” or “first period”), if the employer had not made such an election and if, as the case may be, subparagraph i of subparagraph a or subparagraph ii of subparagraph b of that third paragraph were read without reference to “the particular taxation year or” or “the particular fiscal period or”, or, in the case of a deemed large investment project within the meaning of the seventh paragraph of section 33, where the first year or first period is not later than the taxation year or fiscal period, as the case may be, that includes the date of the beginning of the tax-free period in respect of the second large investment project and where the particular taxation year or fiscal period is not the first year or first period and is referred to in subparagraph a or b, whichever of the following amounts is applicable:

(a)  where the particular taxation year or fiscal period begins before the date of the beginning of the tax-free period in respect of the second large investment project and ends on that date or later, the total of the particular amount and the amount determined by the formula

E × F;

(b)  where the particular taxation year or fiscal period begins on the date of the beginning of the tax-free period in respect of the second large investment project or later, the total of the particular amount and the employer’s tax assistance limit in relation to that second large project.

The cumulative value of an employer’s tax assistance, for a particular taxation year or fiscal period, in respect of a large investment project of the employer, is equal to

(a)  where the employer is a corporation, the aggregate of

i.  the aggregate of all amounts each of which is, in respect of the large investment project, for the taxation year or a preceding taxation year to which the computation method election in relation to the project applies, equal to the amount determined by the formula

G × H × I,

ii.  the aggregate of all amounts each of which is, in respect of the large investment project, for a preceding taxation year to which the computation method election in relation to the project applies, equal to the amount determined by the formula

J × K,

iii.  where, at any time in the particular taxation year, the employer transfers its recognized business in relation to the large investment project to another corporation or a partnership, the amount that was transferred to the other corporation or the partnership pursuant to the agreement referred to in section 737.18.17.12 of the Taxation Act (chapter I-3) in respect of the transfer, and

iv.  in the case of a deemed large investment project within the meaning of the seventh paragraph of section 33, either of the following amounts, if any:

(1)  where the particular taxation year includes the last day of the tax-free period in respect of the first large investment project and ends after that day, the amount determined by the formula

L – [(L × M) + (E × N)], or

(2)  where the particular taxation year is subsequent to the year that includes the last day of the tax-free period in respect of the first large investment project, the amount determined by the formula

L – E; or

(b)  where the employer is a partnership, the aggregate of

i.  the aggregate of all amounts each of which is, in respect of the large investment project, for a preceding fiscal period to which the computation method election in relation to the project applies, equal to the amount determined by the formula

J × K,

ii.  the aggregate of all amounts each of which is the amount agreed on, in respect of the particular fiscal period or a preceding fiscal period to which the computation method election in relation to the large investment project applies, pursuant to an agreement referred to in section 737.18.17.10.1 of the Taxation Act,

iii.  where, at any time in the particular fiscal period, the employer transfers its recognized business in relation to the large investment project to a corporation or another partnership, the amount that was transferred to the corporation or the other partnership pursuant to the agreement referred to in section 737.18.17.12 of the Taxation Act in respect of the transfer, and

iv.  in the case of a deemed large investment project within the meaning of the seventh paragraph of section 33, either of the following amounts, if any:

(1)  where the particular fiscal period includes the last day of the tax-free period in respect of the first large investment project and ends after that day, the amount determined by the formula

L – [(L × M) + (E × N)], or

(2)  where the particular fiscal period is subsequent to the fiscal period that includes the last day of the tax-free period in respect of the first large investment project, the amount determined by the formula

L – E.

In the formulas in the fourth and fifth paragraphs,

(a)  E is the employer’s tax assistance limit in relation to the second large investment project;

(b)  F is the proportion that the number of days in the part of the particular taxation year or fiscal period that begins on the date of the beginning of the tax-free period in respect of the second large investment project is of the number of days in that taxation year or fiscal period;

(c)  G is 1, unless the employer has an establishment situated outside Québec for the taxation year, in which case it is the proportion that the employer’s business carried on in Québec is of the aggregate of the employer’s business carried on in Canada or in Québec and elsewhere, as determined under subsection 2 of section 771 of the Taxation Act for the taxation year;

(d)  H is the aggregate of

i.  3.2% of the amount by which the amount that would be determined in respect of the employer for the taxation year under section 771.2.1.2 of the Taxation Act if, for the purposes of paragraph b of that section, the employer’s taxable income for the taxation year, for the purposes of Part I of that Act, were computed without reference to section 737.18.17.5 of that Act, exceeds the amount that is determined in respect of the employer for the taxation year under that section 771.2.1.2, and

ii.  11.5% of the amount by which the amount deducted by the employer in computing taxable income for the taxation year under section 737.18.17.5 of the Taxation Act exceeds the excess amount determined under subparagraph i;

(e)  I is the proportion that the employer’s maximum annual tax exemption amount for the taxation year, in relation to the large investment project, is of the aggregate of all amounts each of which is the employer’s maximum annual tax exemption amount for the taxation year, in relation to a large investment project of the employer or of a partnership of which the employer is a member, that is referred to in the first paragraph of section 737.18.17.5 of the Taxation Act for the taxation year;

(f)  J is the aggregate of the amounts that are not payable by the employer for the preceding taxation year or fiscal period under subparagraph ii of subparagraph d.1 of the sixth paragraph of section 34;

(g)  K is the proportion that the employer’s maximum annual contribution exemption amount for the preceding taxation year or fiscal period, in relation to the large investment project, is of the aggregate of all amounts each of which is the employer’s maximum annual contribution exemption amount for the preceding taxation year or fiscal period, in relation to a large investment project of the employer that is referred to in subparagraph d.1 of the sixth paragraph of section 34 for the taxation year or fiscal period;

(h)  L is

i.  where the particular taxation year or fiscal period is referred to in subparagraph 1 of subparagraph iv of subparagraph a or b, as the case may be, of the fifth paragraph, the amount by which the unused portion of the employer’s tax assistance limit, in relation to the deemed large investment project, for the particular taxation year or fiscal period, exceeds the cumulative value of the employer’s tax assistance for the taxation year or fiscal period, as the case may be, in respect of the project, determined without reference to that subparagraph 1, or

ii.  where the particular taxation year or fiscal period is referred to in subparagraph 2 of subparagraph iv of subparagraph a or b, as the case may be, of the fifth paragraph, the amount by which the unused portion of the employer’s tax assistance limit, in relation to the deemed large investment project, for the first taxation year or first fiscal period that follows the taxation year or fiscal period, as the case may be, that includes the last day of the tax-free period in respect of the first large investment project, exceeds the cumulative value of the employer’s tax assistance for the first taxation year or first fiscal period in respect of the project, determined without reference to that subparagraph 2;

(i)  M is the proportion that the number of days in the part of the particular taxation year or fiscal period that ends on the last day of the tax-free period in respect of the first large investment project is of the number of days in the taxation year or fiscal period; and

(j)  N is the proportion that the number of days in the particular taxation year or fiscal period that follow the last day of the tax-free period in respect of the first large investment project is of the number of days in the taxation year or fiscal period.

Where, at any time of a particular day, an employer (in this paragraph referred to as the “acquirer”) acquired all or substantially all of a recognized business from another employer (in this paragraph referred to as the “vendor”), in relation to a large investment project, and where the Minister of Finance previously authorized the transfer of the carrying out of the large investment project to the acquirer, according to a qualification certificate issued by that Minister to the acquirer in respect of the project, the following rules must, where applicable, be taken into consideration for the purposes of subparagraphs b and c of the third paragraph:

(a)  where subparagraph ii of subparagraph d.1 of the sixth paragraph of section 34 applies to the vendor,

i.  the vendor’s taxation year or fiscal period that includes that time is deemed to end on the particular day, and

ii.  the vendor’s last day of the tax-free period, in respect of the large investment project, is deemed to be the particular day; and

(b)  where subparagraph ii of subparagraph d.1 of the sixth paragraph of section 34 applies to the acquirer, the acquirer’s taxation year or fiscal period that includes that time is deemed to begin on the particular day.

Where the first taxation year or first fiscal period to which the computation method election applies, in relation to a large investment project of an employer, ends before the date of the end of the start-up period of the large investment project, the unused portion of the employer’s tax assistance limit, in relation to the project, must be increased, for a particular taxation year or fiscal period that is subsequent to that first taxation year or first fiscal period, as the case may be, by the amount that is the product obtained by multiplying by 15% the amount that would be the employer’s total qualified capital investments on the date of the end of the start-up period or, if it is earlier, the date of the end of the particular taxation year or fiscal period, if the definition of “total qualified capital investments” in the first paragraph of section 737.18.17.1 of the Taxation Act were read as if “from the beginning of the carrying out of the large investment project” were replaced by “from the time that immediately follows the end of the employer’s first taxation year, or first fiscal period, to which the computation method election applies”.

For the purpose of applying subparagraphs b and c of the third paragraph to a deemed large investment project within the meaning of the seventh paragraph of section 33, the following rules must be taken into consideration:

(a)  the date of the beginning of the tax-free period that is referred to in those subparagraphs is the date that is determined in respect of the first large investment project; and

(b)  the last day of the tax-free period that is referred to in those subparagraphs is the day that is determined in respect of the second large investment project, unless the particular year or fiscal period precedes the year or period for which a first certificate has been issued in relation to the project, in which case it is the day that is determined in respect of the first large investment project.

2024, c. 11, s. 148.