I-0.4 - Mining Tax Act

À jour au 19 avril 2006

Ce document a valeur officielle.

chapter D-15

Mining Duties Act

CHAPTER I INTERPRETATION AND GENERALITIES

1. In this Act, unless the context indicates otherwise,

“amalgamation” means a merger of several legal persons, hereinafter called “predecessor legal persons”, which are replaced to form one legal person hereinafter referred to as the “new legal person”, which is formed otherwise than by the acquisition of property of another legal person or by the distribution of property of another legal person being wound up;

“assessment” means an assessment, a reassessment or an additional assessment;

“concentration” means any processing of ore or mine tailings to separate a mineral substance from its gangue and obtain a concentrate;

“environmental trust” means an environmental trust, within the meaning of section 21.40 of the Taxation Act (chapter I‐3) that is resident in Québec for the purposes of Part I of that Act;

“exploration” means all surface work performed for the research and identification of mineral substances in Québec, until a mineral deposit has been delimited, if the work consists in

(1)  geological surveys;

(2)  ground or airborne geophysical surveys;

(3)  photogeological analyses;

(4)  geochemical or biogeochemical surveys;

(5)  soil stripping;

(6)  trenching;

(7)  sampling and analyses;

(8)  diamond drilling, percussion drilling or reverse circulation drilling;

(9)  any other surface work essential to the research and identification of a mineral deposit;

“government assistance” means any direct or indirect assistance from a government, municipality or other public body, whether as a subsidy, premium, forgivable loan, tax deduction, advance, or as any other form of assistance other than assistance excluded by regulation of the Government;

“mine” means an industrial complex situated in Québec, the object of which is the extraction and processing of mineral substances, and which may include an ore processing mill, a laboratory and various infrastructures such as port and rail facilities, and a camp;

“mine development” means all work subsequent to mineral deposit evaluation work, the purpose of which is to bring into production an orebody situated in Québec, if the work consists in

(1)  open pit stripping of overburden and waste rock above an orebody;

(2)  shaft sinking, the excavation of ramps, drifts and raises and other related mine development works, except work performed to make such openings in a mineralized zone, or giving access to a mineralized zone if the total length of the opening is less than 20 metres;

“mineral deposit” means a quantity of mineral substance having known physical limits;

“mineral deposit evaluation” means all work, other than work performed pursuant to a decision to bring an orebody into production, the object of which is the technical and economic evaluation of a mineral deposit for the purpose of identifying an orebody situated in Québec, if the work consists in

(1)  surface exploration work performed to ascertain more precisely the technical and economic parameters of a mineral deposit;

(2)  the excavation of ramps, adits, shafts, drifts, raises and other related works necessary to the underground reserve evaluation of a mineral deposit;

(3)  the underground or surface extraction of a bulk sample and testing in a mill or laboratory to verify drilling results and to determine the optimal conditions for extraction and processing;

(4)  determination of mining extraction and metallurgical technologies;

(5)  technical and economic studies necessary to a decision whether or not to bring an orebody into production;

(6)  any other work essential to the identification of the orebody;

“mineral substance” means any natural mineral substance, whether solid, gaseous or liquid, except water, and includes a fossilized organic substance or mine tailings, but does not include a mineral substance the well head value of which is subject to the royalty referred to in section 204 of the Mining Act (chapter M‐13.1);

“mining operation” means all work related to the various phases in the mineral development process, namely exploration, mineral deposit evaluation, mine development, the reclamation or rehabilitation of land situated in Québec, the extraction, processing, transportation, handling, storage and marketing of a mineral substance extracted from Québec soil up to the time of its alienation or use by the operator, and the processing of mine tailings from Québec, but does not include work

(1)  performed for others;

(2)  (paragraph repealed);

(3)  carried out after 17 October 1990 in respect of surface mineral substances within the meaning assigned to that expression in section 1 of the Mining Act, or of mineral substances the rights in or over which have been surrendered to the owner of the soil under section 5 of that Act;

“Minister” means the Minister of Natural Resources and Wildlife;

“northern mine” means a mine situated north of the fifty-fifth parallel of north latitude;

“operator” means a person or partnership, other than a joint venture, that performs mining operation work, either alone or with others, or through a mandatary, on land situated in Québec or in a mine he owns, leases or occupies;

“ore” means a mineral substance that may be extracted for the purpose of obtaining a commercial product;

“orebody” means a volume of ore having known physical limits;

“processing” means any activity involving the concentration, smelting or refining of a mineral substance and includes any activity involving pelletization, the production of powder or the production of steel billets, or any other activity prescribed by regulation;

“processing asset” means property to which section 10 applies, situated in Québec, that is

(1)  a processing plant;

(2)  equipment used entirely or almost entirely for processing;

(3)  property used mainly to supply water or energy to a processing plant;

(4)  (paragraph repealed);

(5)  property used entirely or almost entirely for the handling or transportation of a mineral substance within a processing plant; or

(6)  property used entirely or almost entirely for the handling or transportation of mine tailings emanating directly from a processing plant, to a mine tailings site or mine tailings heap;

but does not include

(7)  property used during an activity preliminary to primary crushing;

(8)  property used for the primary crushing of a mineral substance;

(9)  subject to paragraphs 4, 5 and 6, property used for the transportation, handling, storage or marketing of a mineral substance;

(10)  property used for the transportation of solid, liquid or gas fuel;

(11)  subject to paragraph 6, property used in the operation of a mine tailings site or mine tailings heap, from the first deposit of tailings in an area laid out for that purpose; or

(12)  subject to paragraph 3, service property;

“processing plant” means the whole or part of a building in which the processing of a mineral substance is carried out and which is used solely for that purpose;

“processing product” means a product, by-product or derivative obtained as a result of the processing of a mineral substance;

“refining” means any processing of a product from a smelting or concentration operation to remove impurities, which produces very high grade metal;

“service property” means property, other than a railroad not situated at the mine, acquired for the purpose of realizing or producing income from a mine and of providing services to the mine or to a townsite in which a large proportion of persons who ordinarily work in the mine reside, if the property is

(1)  an airport, dam, basin, fire station, natural gas pipeline, energy transmission line, wastewater treatment plant, sewer, street lighting network, water main, water pumping station, water supply network, wharf, or similar property;

(2)  a road, sidewalk, runway, parking lot, storage area, or similar surface construction;

(3)  a machine or material accessory to property referred to in paragraph 1 or 2;

“smelting” means any processing of an ore or concentrate wherein the charge is melted and chemically converted to produce a slag and a matte or metal containing impurities.

1975, c. 30, s. 1; 1985, c. 39, s. 1; 1987, c. 64, s. 334; 1994, c. 47, s. 1; 1996, c. 4, s. 1; 1996, c. 39, s. 2; 1997, c. 85, s. 18; 1999, c. 83, s. 4; 2000, c. 5, s. 1; 2001, c. 51, s. 1; 2002, c. 40, s. 13; 2003, c. 8, s. 6; 2006, c. 3, s. 35.

2. In this Act, the expression “fiscal year” means the period for which the mining operation accounts of an operator are ordinarily made up each year and, in the absence of an established practice, the fiscal year adopted by the operator.

Nevertheless, no fiscal year shall exceed fifty-three weeks and no change shall be made therein without the written authorization of the Minister.

1975, c. 30, s. 2; 1994, c. 47, s. 2.

2.1. In the event that an operator ceases, for an indeterminate period, all activities related to its mining operation, the fiscal year of the operator is deemed to end immediately before the time at which the activities cease and, for the purpose of determining its fiscal year after that time, the operator is deemed not to have established a fiscal year for its mining operation before that time.

1994, c. 47, s. 3.

3. For the purposes of this Act, the following are related persons:

(a)  individuals connected by blood relationship, marriage, civil union, de facto union or adoption;

(b)  a partnership and a person who is a member thereof or with whom one or more partners are so connected or by whom more than one-half of its available property has been advanced;

(c)  a company and a person who directly or indirectly controls it or who holds more than one-half of its capital stock, or who has provided it, by loan or otherwise, with more than one-half of the property which it has available for its business;

(d)  companies directly or indirectly controlled by the same person or group of persons;

(e)  a company and a person who is one of several related persons by whom such company is directly or indirectly controlled.

1975, c. 30, s. 3; 2002, c. 6, s. 133.

4. For the purposes of this Act:

(a)  persons are connected by blood relationship if one is the descendant of the other, or is his or her brother or sister;

(b)  persons are connected by marriage, a civil union or a de facto union if one is connected with the other or with a person connected with the other by blood relationship or by adoption; and

(c)  persons are connected by adoption if one has been adopted, legally or de facto, and would be connected with the other by blood relationship or by marriage, a civil union or a de facto union if his or her filiation by adoption were filiation by blood.

1975, c. 30, s. 4; 1982, c. 17, s. 44; 2002, c. 6, s. 134.

CHAPTER II LIABILITY

5. Every operator shall pay, for a fiscal year, duties on its annual profit for that fiscal year.

1975, c. 30, s. 5; 1987, c. 64, s. 335; 1990, c. 36, s. 23; 1994, c. 47, s. 4.

CHAPTER III COMPUTATION OF ANNUAL PROFIT

DIVISION I RULES RELATING TO THE COMPUTATION OF ANNUAL PROFIT

1994, c. 47, s. 5.

6. Subject to section 6.1, the gross value of the annual output of an operator for a fiscal year is the value of the mineral substances and, where applicable, of the processing products, derived from the operator’s mining operation, that is established

(1)  where the mineral substances and, where applicable, the processing products are used by the operator in the fiscal year, at the market price at the time of their use; or

(2)  where subparagraph 1 does not apply, according to one of the following methods of valuation:

(a)  at the market price at the time of alienation of the mineral substances and, where applicable, of the processing products alienated by the operator in the fiscal year;

(b)  according to the method used by the operator to prepare the financial statements for that fiscal year provided that the method is consistent with generally accepted accounting principles;

(c)  at the amount received or receivable as consideration for the alienation of the mineral substances and, where applicable, of the processing products alienated by the operator in the fiscal year.

For the purposes of the first paragraph, the value of the mineral substances and, where applicable, of the processing products does not include a gain or loss resulting from a hedging or speculative transaction.

1975, c. 30, s. 6; 1994, c. 47, s. 6; 1996, c. 4, s. 2; 2001, c. 51, s. 2.

6.1. For the purpose of determining the gross value of the annual output of an operator for a fiscal year, the value of the mineral substances and, where applicable, of the processing products, shall be established on the basis of the method of valuation provided for in one of subparagraphs a to c of subparagraph 2 of the first paragraph of section 6 that was used by the operator to determine the gross value of annual production for the preceding fiscal year, unless the Minister authorizes the operator to use another of the methods provided for in that subparagraph 2, in which case the operator shall comply with the conditions determined by the Minister.

In addition, for the purpose of determining the gross value of annual output for a fiscal year, an operator must also obtain the authorization of the Minister and comply with the conditions determined by the Minister, if the method of valuation used by the operator to determine the value of mineral substances and, where applicable, of the processing products is the method provided for in subparagraph b of subparagraph 2 of the first paragraph of section 6, and if the method used by the operator to prepare the financial statements for that fiscal year differs from the method used by the operator to prepare the financial statements for the preceding fiscal year.

This section does not apply for the purpose of determining the gross value of an operator’s annual output for the first fiscal year of the operator other than a fiscal year deemed to be the operator’s first fiscal year by reason of section 2.1.

2001, c. 51, s. 3.

7. In case of doubt or where the gross value of an operator’s annual output for a fiscal year does not correspond to the market value, the Minister may value the mineral substances and, where applicable, the processing products, derived from the operator’s mining operation for the fiscal year, and such valuation shall constitute the gross value of the operator’s annual output for the fiscal year for the purposes of this Act.

1975, c. 30, s. 7; 1994, c. 47, s. 7; 1996, c. 4, s. 3; 2001, c. 51, s. 4.

8. Subject to section 8.0.1, the annual profit of an operator for a fiscal year is the amount by which

(1)  the aggregate of

(a)  the gross value of the operator’s annual output for that fiscal year;

(a.1)  where, for the purpose of determining the gross value of the operator’s annual output for a fiscal year, the Minister authorizes under section 6.1 the use of a method for the fiscal year that differs from the method used by the operator for the preceding fiscal year, the amount, if any, by which the value that would be the gross value of annual output for the preceding fiscal year if that value had been established on the basis of the method used by the operator to determine the gross value of annual output for the fiscal year, exceeds the gross value of annual output for the preceding fiscal year;

(b)  an amount, other than government assistance, received or receivable by the operator during the fiscal year from a person or partnership, by reason of an expense incurred by the operator for a particular fiscal year and that is an expense deducted in computing annual profit for the particular fiscal year or an expense taken into account for the particular fiscal year, for the purposes of subparagraph b of paragraph 1 of section 16.1; and

(c)  the amount determined under section 10.2 or 10.3 for that fiscal year;

(d)  the lesser of the operator’s cumulative contributions account at the end of the fiscal year and the aggregate of all amounts each of which is an amount that relates to the reclamation of land that is a mining operation, and that is included, under paragraph z or z.1 of section 87 of the Taxation Act (chapter I-3), in computing the operator’s income for the fiscal year for the purposes of that Act, in respect of an environmental trust under which the operator is a beneficiary;

(e)  any amount included, under paragraph w of section 87 of the Taxation Act, in computing the operator’s income for the fiscal year for the purposes of that Act, in relation to an amount that the operator is deemed to have paid to the Minister of Revenue under sections 1029.8.36.168, 1029.8.36.170, 1029.8.36.171.1, 1029.8.36.171.2 and 1029.8.36.173 of that Act;

(f)  where the operator is a partnership, any amount included, under paragraph w of section 87 of the Taxation Act because of sections 87.3 and 87.3.1 of that Act, in computing the operator’s income for the fiscal year for the purposes of that Act, in relation to an amount that a legal person that is a member of the operator is deemed to have paid to the Minister of Revenue under section 1029.8.36.169 or 1029.8.36.171 of that Act; and

(g)  where the operator is a partnership, any amount included, under paragraph w of section 87 of the Taxation Act because of section 87.3 of that Act, in computing the operator’s income for the fiscal year for the purposes of that Act, in relation to an amount that a legal person that is a member of the operator is deemed to have paid to the Minister of Revenue under sections 1029.8.36.174 and 1029.8.36.175 of that Act; exceeds

(2)  the aggregate of

(a)  the total of all expenses each of which is an expense incurred by the operator in respect of a mining operation, for the fiscal year, to the extent that the expense was incurred to realize the gross value of the annual output from the mining operation and provided that the expense relates directly thereto;

(b)  the total of all expenses each of which is an expense incurred by the operator, for the fiscal year, for scientific research and experimental development work carried out in Canada, to the extent that it may be considered to relate to the operator’s mining operation;

(c)  the total of all gifts each of which is a gift made in Québec by the operator during the fiscal year for cultural, educational or charitable purposes, to the extent that the gift is referred to in section 710 of the Taxation Act, if that section were read without reference to subparagraphs vi to viii of paragraph a, and provided that the total of the gifts does not exceed 10% of annual profit, determined without reference to this subparagraph or to subparagraphs f to h and j;

(d)  subject to sections 8.6 and 10, the amount deducted by the operator, for the fiscal year, as a depreciation allowance;

(e)  subject to section 16, the amount deducted by the operator, for the fiscal year, as an exploration, mineral deposit evaluation or mine development allowance;

(f)  subject to section 17, the amount deducted by the operator, for the fiscal year, as an investment allowance;

(g)  subject to section 19.1, the amount deducted by the operator, for the fiscal year, as an additional exploration allowance;

(h)  subject to section 21, the amount deducted by the operator, for the fiscal year, as a processing allowance;

(h.1)  subject to sections 8.6 and 26.0.1, the amount deducted by the operator, for the fiscal year, as an additional depreciation allowance;

(i)  the amount determined in accordance with section 10.4 or 10.5 for the fiscal year;

(j)  subject to section 26.1, the amount deducted by the operator, for the fiscal year, as an additional allowance for a northern mine;

(k)  the aggregate of all amounts each of which is an amount paid by the operator for the reclamation of land that is a mining operation, and that is deductible under paragraph r or s of section 157 of the Taxation Act in computing the operator’s income for the fiscal year for the purposes of that Act, in respect of an environmental trust under which the operator is a beneficiary;

(l)  where, for the purpose of determining the gross value of the operator’s annual output for a fiscal year, the Minister authorizes under section 6.1 the use of a method for the fiscal year that differs from the method used by the operator for the preceding fiscal year, the amount, if any, by which the gross value of annual output for the preceding fiscal year exceeds the value that would be the gross value of annual output for the preceding fiscal year if that value had been established on the basis of the method used by the operator to determine the gross value of annual output for the fiscal year.

1975, c. 30, s. 8; 1979, c. 45, s. 149; 1985, c. 6, s. 477; 1994, c. 47, s. 8; 1996, c. 4, s. 4; 1996, c. 39, s. 3; 1997, c. 85, s. 19; 1999, c. 83, s. 5; 2000, c. 5, s. 2; 2001, c. 51, s. 5; 2004, c. 21, s. 30.

8.0.0.1. The cumulative contributions account of a particular operator at any time is the amount by which

(1)  the aggregate of

(a)  the aggregate of all amounts each of which is a contribution paid by the particular operator after 12 May 1994 and before that time to an environmental trust under which the particular operator is a beneficiary, for the reclamation of land that is a mining operation ;

(b)  the aggregate of all amounts each of which is the consideration paid by the particular operator after 12 May 1994 and before that time for the acquisition, from another person or partnership, of all or part of the particular operator’s interest as a beneficiary under an environmental trust maintained for the sole purpose of financing the reclamation of land that is a mining operation, other than consideration that is the assumption of a reclamation obligation in respect of the trust ;

(c)  the amount of the cumulative contributions account of an operator in respect of the environmental trust all or part of whose interest as a beneficiary is acquired by the particular operator as consideration for the assumption of a reclamation obligation, in respect of the trust, in relation to land that is a mining operation, determined immediately before the time of acquisition ; and

(d)  the aggregate of all amounts each of which is a balance of the cumulative contributions account of the particular operator, as determined, before that time, under paragraph 8 of section 35.3; exceeds

(2)  the aggregate of

(a)  all amounts each of which is an amount included, under subparagraph d of paragraph 1 of section 8, in computing the operator’s annual profit for a fiscal period ending before that time, and

(b)  the amount included in determining an operator’s cumulative contributions account, under subparagraph c of paragraph 1, because of the acquisition by the operator of all or part of the interest of the particular operator, as a beneficiary under an environmental trust.

1996, c. 39, s. 4; 2000, c. 5, s. 3.

8.0.1. For the purposes of section 8, an operator shall not deduct, in computing his annual profit for a fiscal year,

(1)  an expense, except to the extent that it was incurred by the operator in respect of a mining operation to realize the gross value of the annual output from the mining operation and provided that the expense relates directly thereto;

(2)  an expense to the extent that it may reasonably be considered that an amount is received or receivable by the operator, in respect of the expense, as government assistance;

(3)  an expense incurred for constitution, organization or reorganization;

(4)  a loss or replacement of capital, a payment or outlay of capital or a depreciation, obsolescence or depletion allowance, except as permitted by sections 10, 17, 21 and 26.0.1;

(5)  a royalty paid or payable in respect of output;

(6)  a premium or assessment paid in respect of an insurance contract, except where the insurance contract pertains to property regularly used in mining operation or a person, other than an executive or director, who is an employee of the operator and whose duties relate to mining operation;

(7)  costs of financing;

(8)  an amount paid or payable under this Act;

(9)  taxes on profits and on capital, income tax under a federal, provincial or foreign law and professional fees incurred in respect of an objection or an appeal in respect of an assessment provided for in any such law;

(10)  a reserve or provision other than a reserve or provision prescribed by regulation of the Government;

(11)  an amount referred to in paragraph 3 of section 16.3; and

(12)  a loss resulting from a hedging or speculative transaction.

1994, c. 47, s. 8; 1997, c. 85, s. 20; 1999, c. 40, s. 111.

8.1. The annual loss of an operator for a fiscal year is the amount of such loss computed in accordance with the provisions of this chapter which relate to the computation of the annual profit, adapted as required.

1985, c. 39, s. 2.

8.2. An amount deductible under this Act in respect of an outlay or expense may be deducted only to the extent that the outlay or expense is reasonable in the circumstances.

1994, c. 47, s. 9.

8.3. For the purposes of this Act, except sections 35.3, 35.4 and 35.5, an outlay or expense resulting from a transaction with a person related to the operator is deemed not to exceed the fair market value of property or a service supplied where the outlay or expense exceeds that value, and an operator who supplied property or a service following a transaction with a related person is deemed to have received an amount at least equal to the fair market value of the property or service where the consideration received for the property or service is less than that value or where there is no consideration for the property or service.

1994, c. 47, s. 9.

8.4. An operator who, in computing its annual profit for a fiscal year, has already included or deducted an amount, directly or indirectly, is not required to again include the amount or is not authorized, as the case may be, to again deduct it, directly or indirectly, unless the operator is expressly required or authorized by this Act or in terms in which that requirement or authorization may necessarily be inferred.

1994, c. 47, s. 9.

8.5. An amount referred to in subparagraph a or b of paragraph 2 of section 8 does not include an amount taken into account in computing an allowance referred to in subparagraphs d to g of paragraph 2 of that section.

1994, c. 47, s. 9.

8.6. The amount that an operator may claim as a depreciation allowance under subparagraph d of paragraph 2 of section 8 or as an additional depreciation allowance under subparagraph h.1 of that paragraph 2 for a fiscal year is reduced by the reasonable amount of the allowance that relates to the use of each property, in that fiscal year, for purposes other than mining operation.

1994, c. 47, s. 9; 1997, c. 85, s. 21.

DIVISION II DEPRECIATION ALLOWANCE

9. In this division,

“alienation of property” means any transaction or event which confers the right to the proceeds of the alienation of property;

“proceeds of alienation” of property, taking into account the necessary adjustments by reason of the application of section 9.2, where applicable, means

(1)  the sale price of property alienated;

(2)  compensation for property unlawfully appropriated by a person;

(3)  compensation for property destroyed, and any amount received or receivable under an insurance policy in respect of the loss or destruction of property;

(4)  compensation for property appropriated by a person under statutory authority, or in respect of which the person has given a notice of intention to so appropriate it;

(5)  compensation for acts or omissions of a person whether or not acting in the exercise of a right, under statutory authority or otherwise, that injuriously affect property;

(6)  compensation for property damage and any amount received or receivable under an insurance policy covering such damage, except to the extent that the compensation or amount, as the case may be, is expended to repair the damage within a reasonable time after the damage is caused; and

(7)  the amount by which the liability of the owner of property to a creditor is extinguished as a result of the transfer of the property to the creditor or of the forgiveness of the debt;

“property of the first class” means a road, a building or equipment purchased before 1 April 1975 and actually used in mining operation;

“property of the second class” means a road, a building or equipment purchased after 31 March 1975 and before 13 May 1994 and actually used in mining operation;

“property of the third class” means a road, a building, equipment or a service property acquired after 12 May 1994 and regularly used in mining operation;

“undepreciated capital cost” of property of a class of an operator, at any time, means the amount by which

(1)  the aggregate of

(a)  the total of all amounts each of which is the capital cost to the operator of each property of the class acquired before that time;

(b)  the total of all amounts each of which is an amount determined in accordance with the second paragraph of section 10.2, in respect of that class, for a fiscal year ending before that time;

(c)  the total of all amounts each of which is an amount determined in accordance with section 10.3, in respect of that class, for a fiscal year ending before that time; and

(d)  the total of all amounts each of which is an amount of government assistance, determined taking into account, where applicable, the adjustment provided for in section 9.2, of the capital cost of property of that class to which the amount of assistance relates, that has been repaid by the operator, before that time, pursuant to an obligation to do so, subsequent to the alienation of the property and that would have been included in determining the capital cost thereof under section 9.1 had the repayment been made before the alienation;

exceeds

(2)  the aggregate of

(a)  the total of all amounts each of which is an amount allowed to the operator as a depreciation allowance for a fiscal year ending before that time, in respect of property of that class;

(b)  the total of all amounts each of which is an amount, where the operator before that time alienated property of that class, that is the lesser of the proceeds of alienation of the property minus any expenses made or incurred by the operator for the purpose of making the alienation, and the capital cost to the operator of the property;

(c)  the total of all amounts each of which is an amount determined in accordance with the second paragraph of section 10.4, in respect of that class, for a fiscal year ending before that time;

(d)  the total of all amounts each of which is an amount determined in accordance with section 10.5, in respect of that class, for a fiscal year ending before that time;

(e)  the total of all amounts each of which is an amount of government assistance, determined taking into account, where applicable, the adjustment provided for in section 9.2, of the capital cost of the property of that class to which the amount of assistance relates, that the operator received or was entitled to receive before that time subsequent to the alienation of the property and that would have been included under section 9.1 in the amount of assistance that the operator received or was entitled to receive in respect of the property had the amount been received before the alienation of the property;

(f)  the total of all amounts each of which is an amount determined for a fiscal year ending before 13 May 1994 and that is applied to reduce the depreciation allowance in respect of a property of that class, for the portion of the property used in part for purposes other than mining operation;

(g)  the total of all amounts each of which is an amount determined for a fiscal year ending before that time under section 8.6 and that is applied to reduce the depreciation allowance in respect of the property of that class; and

(h)  the total of all amounts each of which is an amount determined in respect of that class in accordance with paragraph c of section 13, as it read before 13 May 1994.

1975, c. 30, s. 9; 1994, c. 47, s. 11.

9.1. For the purposes of this Act, where an operator has received or is entitled to receive government assistance in respect of property or for the acquisition of property, the capital cost to the operator of the property at a particular time is deemed to be the amount by which the total of the capital cost of the property, determined without reference to this section or section 9.2, and the amount of the assistance in respect of the property, repaid by the operator pursuant to an obligation to do so, before alienation of the property and before the particular time, exceeds the amount of assistance that the operator received or is entitled to receive, before the particular time, in respect of the property before its alienation.

1994, c. 47, s. 11.

9.2. For the purposes of this Act, except section 21, where property, in the first fiscal year in which it is regularly used by the operator for the first time, is used in part in connection with mining operation and in part for another purpose, the capital cost of the property for the first fiscal year and any subsequent fiscal year is deemed to be the amount by which the capital cost of the property, determined without reference to this section but with reference to section 9.1, where applicable, exceeds the amount that is equal to the proportion of the cost that the use of the property for another purpose is of the total use made of the property.

1994, c. 47, s. 11.

10. Subject to section 14, the amount that an operator may deduct under subparagraph d of paragraph 2 of section 8 in respect of property of a class as a depreciation allowance in computing his annual profit for a fiscal year shall not exceed the lesser of

(1)  the part of the capital cost of the property of that class, for that fiscal year;

(2)  the undepreciated capital cost of the property of that class, before any deduction under that subparagraph d, at the end of the fiscal year; and

(3)  where the operator is no longer the owner of property of that class at the end of the fiscal year, zero.

1975, c. 30, s. 10; 1994, c. 47, s. 12.

10.1. The part of the capital cost referred to in section 10 for a fiscal year is equal to the amount obtained by applying, in respect of the property of a class acquired before the end of the fiscal year, the following percentage:

(1)  15% of the total of all amounts each of which is the capital cost of each property of the first class, except if that capital cost has been wholly allowed under section 10, as it read before 13 May 1994;

(2)  30% of the total of all amounts each of which is the capital cost of each property of the second class, except if that capital cost has been wholly allowed under section 10, as it read before 13 May 1994;

(3)  100% of the total of all amounts each of which is the capital cost of each property of the third class.

1994, c. 47, s. 12.

10.2. The amount that an operator is required to include in computing his annual profit for a particular fiscal year under subparagraph c of paragraph 1 of section 8 in respect of the first or second class, is the proportion of the amount determined under the second paragraph that the use of the property for the purposes of the operator’s mining operation for the particular fiscal year is of the total use of the property of the class in that fiscal year.

The amount referred to in the first paragraph is the amount by which the aggregate of the amounts referred to in subparagraphs a to h of paragraph 2 of the definition of “undepreciated capital cost” in section 9, in respect of the class, exceeds the aggregate of the amounts referred to in subparagraphs a to d of paragraph 1 of the definition of that expression.

1994, c. 47, s. 12.

10.3. The amount that an operator is required to include in computing his annual profit for a particular fiscal year under subparagraph c of paragraph 1 of section 8 in respect of the third class, is the amount by which the aggregate of the amounts referred to in subparagraphs a to h of paragraph 2 of the definition of “undepreciated capital cost” in section 9, in respect of that class, exceeds the aggregate of the amounts referred to in subparagraphs a to d of paragraph 1 of the definition of that expression.

1994, c. 47, s. 12.

10.4. For the purposes of subparagraph i of paragraph 2 of section 8, where at the end of a particular fiscal year an operator is no longer the owner of property of the first or second class, the amount that he is required to deduct in computing his annual profit for that particular fiscal year, in respect of the class, is the proportion of the amount determined under the second paragraph that the use of the property for the purposes of the operator’s mining operation for the particular fiscal year is of the total use of the property of the class in that fiscal year.

The amount referred to in the first paragraph is the amount by which the aggregate of the amounts referred to in subparagraphs a to d of paragraph 1 of the definition of “undepreciated capital cost” in section 9, in respect of the class, exceeds the aggregate of the amounts referred to in subparagraphs a to h of paragraph 2 of the definition of that expression.

1994, c. 47, s. 12.

10.5. For the purposes of subparagraph i of paragraph 2 of section 8, where at the end of a particular fiscal year an operator is no longer the owner of property of the third class, the amount that he is required to deduct in computing his annual profit for that particular fiscal year, in respect of that class, is the amount by which the aggregate of the amounts referred to in subparagraphs a to d of paragraph 1 of the definition of “undepreciated capital cost” in section 9, in respect of the class, exceeds the aggregate of the amounts referred to in subparagraphs a to h of paragraph 2 of the definition of that expression.

1994, c. 47, s. 12.

11. (Repealed).

1975, c. 30, s. 11; 1994, c. 47, s. 13.

12. (Repealed).

1975, c. 30, s. 12; 1994, c. 47, s. 13.

13. (Repealed).

1975, c. 30, s. 13; 1994, c. 47, s. 13.

14. Where the fiscal year of an operator comprises fewer than 12 months, the depreciation allowance shall not exceed the proportion of the maximum amount deductible under section 10 that the number of days in the fiscal year is of 365.

1975, c. 30, s. 14; 1994, c. 47, s. 14.

15. (Repealed).

1975, c. 30, s. 15; 1994, c. 47, s. 15.

DIVISION III EXPLORATION, MINERAL DEPOSIT EVALUATION AND MINE DEVELOPMENT ALLOWANCE

1994, c. 47, s. 16.

16. The amount that an operator may deduct as an exploration, mineral deposit evaluation and mine development allowance in computing his annual profit for a fiscal year under subparagraph e of paragraph 2 of section 8 shall not exceed the cumulative exploration, mineral deposit evaluation and mine development expenses at the end of that fiscal year.

1975, c. 30, s. 16; 1994, c. 47, s. 16.

16.1. Cumulative exploration, mineral deposit evaluation and mine development expenses, at any time, are the amount by which

(1)  the aggregate of

(a)  subject to paragraph c of section 27, as it read before 13 May 1994, the total of all amounts each of which is a deductible expense referred to in paragraph m or n of section 8, as it read before 13 May 1994, and incurred by the operator after 31 December 1964;

(b)  subject to sections 16.2 to 16.6, the total of all amounts each of which is a deductible expense incurred by the operator after 12 May 1994 and before that time, in respect of exploration, mineral deposit evaluation and mine development work performed in connection with the operator’s mining operation;

(b.1)  25% of the total of all amounts each of which is an amount referred to in subparagraph b, other than an amount relating to expenses referred to in any of paragraphs c to d of the definition of “eligible expenses” in the first paragraph of section 1029.8.36.167 of the Taxation Act (chapter I‐3) that was taken into account in computing an amount that the operator or a legal person that is a member of the operator is deemed to have paid to the Minister of Revenue for a taxation year, within the meaning of Part I of that Act, under Division II.6.15 of Chapter III.1 of Title III of Book IX of Part I of that Act, that was incurred by the operator after 31 March 1998 and before that time in respect of exploration work performed

i.  in the territory in which the program entitled ‘Near North Mineral Exploration Program’, implemented by the Ministère des Ressources naturelles et de la Faune, applies, or

ii.  in the territory north of the 55°00″ north latitude;

(c)  the total of all amounts each of which is an amount repaid by the operator before that time under an obligation to repay, in whole or in part, government assistance relating to an amount referred to in subparagraph a or b;

and

(d)  25% of the total of all amounts each of which is an amount repaid by the operator before that time, pursuant to an obligation to repay, in whole or in part, government assistance relating to an amount referred to in subparagraph b.1; exceeds

(2)  the aggregate of

(a)  the total of all amounts each of which is an amount allowed to the operator as a development allowance under paragraph o of section 8, as it read before 13 May 1994, in computing his annual profit for a fiscal year ending before 13 May 1994;

(b)  the total of all amounts each of which is an amount deducted by the operator under paragraph m or n of section 8, as it read before 13 May 1994, in computing his annual profit for a fiscal year ending before 13 May 1994;

(c)  the total of all amounts each of which is an amount allowed to the operator, for a fiscal year ending after 12 May 1994 and before that time, as an exploration, mineral deposit evaluation and mine development allowance under subparagraph e of paragraph 2 of section 8; and

(d)  the total of all amounts each of which is an amount of government assistance relating to an amount referred to in subparagraph a or b of paragraph 1, that the operator received or was entitled to receive before that time;

(e)  25% of the total of all amounts each of which is an amount of government assistance relating to an amount referred to in subparagraph b.1 of paragraph 1 that the operator received or was entitled to receive before that time.

1994, c. 47, s. 16; 1999, c. 83, s. 6; 2002, c. 40, s. 14; 2003, c. 8, s. 6; 2004, c. 21, s. 31; 2005, c. 23, s. 20; 2006, c. 3, s. 35.

16.2. For the purposes of subparagraphs a and b of paragraph 1 of section 16.1, expenses are deductible only if the operator has declared the expenses to be deductible expenses, on or before the date on or before which the operator is required to file a return, in accordance with section 36,

(1)  for the operator’s first fiscal year commencing after 12 May 1994, where the expenses are incurred before 13 May 1994; and

(2)  for the fiscal year following that in which the expenses are incurred, where the expenses are incurred after 12 May 1994.

1994, c. 47, s. 16.

16.3. An amount referred to in subparagraph b of paragraph 1 of section 16.1 does not include an amount that is

(1)  the capital cost of property taken into account in determining the undepreciated capital cost referred to in section 9;

(2)  a general and administrative expense related to exploration, mineral deposit evaluation and mine development work, which is otherwise deductible under section 8;

(3)  the cost of acquiring a mining property or an interest therein, payment of an option to purchase, staking costs and survey fees related to the delimitation of the property, and fees, duties and rents in respect of an immmovable real right referred to in section 8 of the Mining Act (chapter M-13.1).

1994, c. 47, s. 16.

16.4. Where a share of the capital stock of an operator is issued to a person under an agreement in writing entered into between that person and the operator, under which the operator has agreed to incur expenses in respect of exploration, mineral deposit evaluation or mine development work, that would be expenses referred to in subparagraph b of paragraph 1 of section 16.1, and to renounce, under the Taxation Act (chapter I‐3), in favour of that person, an amount that does not exceed the consideration received by the operator for the share, relating to expenses so incurred by the operator, the expenses to which the amount relates are deemed, from the day on which they are incurred, never to have been such expenses incurred by the operator.

The first paragraph does not apply if the share is issued to a legal person that undertakes in writing with the Minister not to renounce, under the Taxation Act, the expenses described in the agreement referred to in the first paragraph and the legal person fulfills such undertaking.

1994, c. 47, s. 16; 1996, c. 4, s. 11; 1999, c. 83, s. 7.

16.5. Where a share of the capital stock of an operator is issued to a partnership under an agreement in writing entered into between the partnership and the operator, under which the operator has agreed to incur expenses in respect of exploration, mineral deposit evaluation or mine development work, that would be expenses referred to in subparagraph b of paragraph 1 of section 16.1, and to renounce, under the Taxation Act (chapter I‐3), in favour of the partnership, an amount that does not exceed the consideration received by the operator for the share, relating to expenses so incurred by the operator, the expenses which relate to the amount or part thereof that has been renounced and which the partnership attributes to each partner are deemed, from the day on which they are incurred, never to have been such expenses incurred by the operator.

The first paragraph does not apply to the part of the expenses which relates to the amount attributed by the partnership to a partner that is a legal person if the legal person undertakes in writing with the Minister not to renounce, under the Taxation Act, that part of the expenses and the legal person fulfills such undertaking.

1994, c. 47, s. 16; 1996, c. 4, s. 11; 1999, c. 83, s. 8.

16.6. Where an operator is a partnership that incurs expenses in respect of exploration, mineral deposit evaluation or mine development work that would be expenses referred to in subparagraph b of paragraph 1 of section 16.1, the expenses relating to the share, described in paragraph d of section 395 of the Taxation Act (chapter I‐3), which is attributed to each partner of the operator, are deemed, from the day on which they are incurred, never to have been such expenses incurred by the operator.

The first paragraph does not apply to the expenses which are attributed by the operator to a partner that is a legal person if the legal person undertakes in writing with the Minister not to renounce, under the Taxation Act, those expenses and the legal person fulfills such undertaking.

1994, c. 47, s. 16; 1996, c. 4, s. 11; 1999, c. 83, s. 9.

DIVISION IV INVESTMENT ALLOWANCE

17. Subject to sections 17.1 and 19, an operator may deduct for a fiscal year, as an investment allowance, 331/3% of the amount by which the expenses described in section 18 and incurred during the period commencing on 1 April 1975 and ending on 12 May 1994 exceeds the expenses in respect of which an investment allowance was claimed by the operator for the preceding fiscal years.

1975, c. 30, s. 17; 1994, c. 47, s. 17.

17.1. An operator shall not deduct an amount as an investment allowance for a fiscal year following the fifth fiscal year ending after 12 May 1994.

1994, c. 47, s. 17.

18. The following expenses may be included in an investment allowance under section 17:

(a)  the cost to the operator of a property specified by regulation that is actually used by him in the production of materials that are mainly products derived from certain ores;

(b)  the cost to the operator of allowable depreciable property actually used in the processing or treatment of ore to the prime metal stage or its equivalent, if an allowance in respect of that property has never been taken previously under this division by any person and the property was so used for a period of at least twelve consecutive months during which it was not used for other purposes more than 25 per cent of the time;

(c)  the mining exploration expenses incurred by the operator in Québec on lands other than those which are the site of the principal mining operation, to the extent that, under paragraph n of section 8, those expenses were deductible in computing his annual profit for a previous fiscal year, or are so deductible for the fiscal year contemplated; and

(d)  the mining exploration and development expenses incurred by the operator in Québec, from 28 March 1979, on the site of an underground mining operation, except the expenses incurred by an operator principally extracting from an iron ore, titanium or asbestos mine and the cost of the property contemplated in Division II of Chapter III, provided that a detailed analysis of these expenses is submitted to the Minister.

The Government shall determine, by regulation, the mining exploration and development expenses and works contemplated in subparagraph d.

1975, c. 30, s. 18; 1979, c. 74, s. 1.

18.1. The mining exploration and development expenses referred to in subparagraphs c and d of section 18 do not include any outlay or expense incurred to the extent that the outlay or expense constitutes an expense incurred

(a)  by a person, including a partnership, pursuant to an agreement entered into with an operator or another legal person or partnership, under which the person incurs such expense solely as consideration for a share of the capital stock of the operator or of another legal person or partnership, for an interest in a partnership, or for an interest or right attaching to the share or interest; or

(b)  by a legal person, including the operator, where a share of the capital stock of the legal person was issued to a person, including a partnership, pursuant to an agreement in writing entered into between the person and the legal person, under which the legal person, for any purpose, agreed to incur such expense and to renounce to the person an amount in respect of the expense so incurred by the legal person not exceeding the consideration received by it for the share.

1985, c. 39, s. 3; 1989, c. 43, s. 1; 1996, c. 4, s. 11.

19. The allowance referred to in section 17 for a fiscal year shall not exceed 331/3% of the annual profit for that fiscal year, determined without reference to that allowance, the additional exploration allowance, the processing allowance, the additional depreciation allowance and the additional allowance for a northern mine referred to in subparagraphs f to h.1 and j of paragraph 2 of section 8.

1975, c. 30, s. 19; 1994, c. 47, s. 18; 1996, c. 4, s. 5; 1997, c. 85, s. 22.

DIVISION IV.1 ADDITIONAL EXPLORATION ALLOWANCE

1994, c. 47, s. 19.

19.1. The amount that an operator may deduct as an additional exploration allowance in computing his annual profit for a fiscal year under subparagraph g of paragraph 2 of section 8 shall not exceed, at the end of that fiscal year, 50% of the lesser of cumulative exploration expenses and the annual ceiling on exploration expenses.

1994, c. 47, s. 19.

19.2. The cumulative exploration expenses of an operator at any time are the amount by which

(1)  the aggregate of

(a)  subject to sections 19.4 to 19.7, the total of all amounts each of which is an expense incurred by the operator after 12 May 1994 and before that time, in respect of exploration or underground core drilling work carried out in Québec, where the mineral substances in respect of which the work is carried out form part of the domain of the State and where the work is performed in connection with the operator’s mining operation

i.  elsewhere than on land under a mining lease or mining concession, and performed before ore is extracted; or

ii.  on land under a mining lease or mining concession, except land from which ore has been or was extracted in the five fiscal years preceding that time; and

(b)  the total of all amounts each of which is an amount repaid by the operator before that time pursuant to an obligation to repay, in whole or in part, government assistance relating to expenses referred to in subparagraph a;

exceeds

(2)  the aggregate of

(a)  the total of all amounts each of which is twice an amount allowed to an operator, in computing his annual profit for a fiscal year ending before that time, as an additional exploration allowance under subparagraph g of paragraph 2 of section 8; and

(b)  the total of all amounts each of which is an amount of government assistance relating to an amount referred to in subparagraph a of paragraph 1 that the operator received or was entitled to receive before that time.

1994, c. 47, s. 19; 1999, c. 40, s. 111.

19.3. The annual ceiling on exploration expenses for a fiscal year is the amount corresponding to the annual profit for that fiscal year computed without reference to the additional exploration allowance, the processing allowance, the additional depreciation allowance and the additional allowance for a northern mine referred to in subparagraphs g to h.1 and j of paragraph 2 of section 8.

1994, c. 47, s. 19; 1996, c. 4, s. 6; 1997, c. 85, s. 23.

19.4. An amount referred to in subparagraph a of paragraph 1 of section 19.2 does not include an amount that is

(1)  the capital cost of property taken into account in determining the undepreciated capital cost referred to in section 9;

(2)  a general and administrative expense relating to exploration and underground core drilling work carried out in Québec and which is otherwise deductible under section 8;

(3)  the cost of acquiring a mining property or an interest therein, payment of an option to purchase, staking costs and survey fees related to the delimitation of the property, and fees, duties and rents in respect of an immovable real right referred to in section 8 of the Mining Act (chapter M-13.1).

1994, c. 47, s. 19.

19.5. Where a share of the capital stock of an operator is issued to a person under an agreement in writing entered into between that person and the operator, under which the operator has agreed to incur expenses in respect of exploration or underground core drilling work carried out in Québec, that would be expenses referred to in subparagraph a of paragraph 1 of section 19.2, and to renounce, under the Taxation Act (chapter I‐3), in favour of that person, an amount that does not exceed the consideration received by the operator for the share, relating to expenses so incurred by the operator, the expenses to which the amount relates are deemed, from the day on which they are incurred, never to have been such expenses incurred by the operator.

The first paragraph does not apply if the share is issued to a legal person that undertakes in writing with the Minister not to renounce, under the Taxation Act, the expenses described in the agreement referred to in the first paragraph and the legal person fulfills such undertaking.

1994, c. 47, s. 19; 1996, c. 4, s. 11; 1999, c. 83, s. 10.

19.6. Where a share of the capital stock of an operator is issued to a partnership under an agreement in writing entered into between the partnership and the operator, under which the operator has agreed to incur expenses in respect of exploration or underground core drilling work carried out in Québec, that would be expenses referred to in subparagraph a of paragraph 1 of section 19.2, and to renounce, under the Taxation Act (chapter I‐3), in favour of the partnership, an amount that does not exceed the consideration received by the operator for the share, relating to expenses so incurred by the operator, the expenses which relate to the amount or part thereof that has been renounced and which the partnership attributes to each partner, are deemed, from the day on which they are incurred, never to have been such expenses incurred by the operator.

The first paragraph does not apply to the part of the expenses which relates to the amount attributed by the partnership to a partner that is a legal person if the legal person undertakes in writing with the Minister not to renounce, under the Taxation Act, that part of the expenses and the legal person fulfills such undertaking.

1994, c. 47, s. 19; 1996, c. 4, s. 11; 1999, c. 83, s. 11.

19.7. Where an operator is a partnership that incurs expenses in respect of exploration or underground core drilling work carried out in Québec, that would be expenses referred to in subparagraph a of paragraph 1 of section 19.2, the expenses relating to the share, described in paragraph d of section 395 of the Taxation Act (chapter I‐3), which is attributed to each partner of the operator, are deemed, from the day on which they are incurred, never to have been such expenses incurred by the operator.

The first paragraph does not apply to the expenses which are attributed by the operator to a partner that is a legal person if the legal person undertakes in writing with the Minister not to renounce, under the Taxation Act, those expenses and the legal person fulfills such undertaking.

1994, c. 47, s. 19; 1996, c. 4, s. 11; 1999, c. 83, s. 12.

DIVISION V PROCESSING ALLOWANCE

1994, c. 47, s. 20.

20. (Repealed).

1975, c. 30, s. 20; 1994, c. 47, s. 21.

21. Subject to sections 23, 23.1 and 25, the amount that an operator may deduct as a processing allowance in computing his annual profit for a fiscal year under subparagraph h of paragraph 2 of section 8 shall not exceed the lesser of

(1)  the aggregate of

(a)  an amount equal,

i.  if the operator does not engage in smelting or refining, to 8% of the capital cost to the operator of each property that is a processing asset during the fiscal year and that is in the operator’s possession at the end of that fiscal year, and

ii.  if the operator engages in smelting or refining, to the aggregate of

(1)   8% of the capital cost of each property referred to in subparagraph i, where the property is used solely in processing ore from a gold or silver mine, and

(2)  the amount by which 15% of the capital cost of each property referred to in subparagraph i, where the property is used in processing ore other than ore from a gold or silver mine, exceeds 7% of the proportion of the capital cost of the property, where it is used for the purposes of concentration, that the quantity of ore concentrated by the operator, which is not smelted or refined by the operator and the processing of which required the use of the property, is of the total quantity of ore the processing of which required the use of the property; and

(b)  subject to section 21.1, 15% of the aggregate of all amounts each of which is the capital cost of property that is in the possession of the operator at the end of the operator’s fiscal year, that is a processing asset, purchased new by the operator after 31 March 1998 and used by the operator in Québec during the fiscal year exclusively for the purpose of processing mine tailings; and

(2)  an amount that is 65% of the annual profit, for that fiscal year, determined before the deduction as a processing allowance, additional depreciation allowance and additional allowance for a northern mine referred to in subparagraphs h, h.1 and j of paragraph 2 of section 8.

1975, c. 30, s. 21; 1994, c. 47, s. 22; 1996, c. 4, s. 7; 1997, c. 85, s. 24; 1999, c. 83, s. 13.

21.1. For the purposes of subparagraph b of paragraph 1 of section 21, the capital cost of property used during a fiscal year that ends after the ninth fiscal year following the fiscal year during which the operator begins processing mine tailings is deemed to be nil.

1999, c. 83, s. 14.

22. (Repealed).

1975, c. 30, s. 22; 1994, c. 47, s. 23.

23. Where property is used in a fiscal year both for the processing of ore and for another purpose, the part of the amount determined under subparagraph a of paragraph 1 of section 21 that relates to that property shall be reduced by an amount equal to the proportion of that part of the amount, determined without reference to this section or section 23.1, that the use of the property for a purpose other than processing for that fiscal year is of the total use of the property for that fiscal year.

1975, c. 30, s. 23; 1994, c. 47, s. 24; 1999, c. 83, s. 15.

23.1. Where property is used in a fiscal year for the processing of ore the actual value of which is not taken into account in determining the gross value of the annual output under section 6, the part of the amount determined under subparagraph a or b of paragraph 1 of section 21, subject to section 23, that relates to that property shall be reduced by an amount equal to the proportion of that part of the amount that the part of the quantity of processed ore the actual value of which is not taken into account in determining the gross value of the annual output, for that fiscal year, is of the total quantity of ore processed by the operator in that fiscal year and the processing of which required the use of the property.

1994, c. 47, s. 24; 1999, c. 83, s. 15.

24. (Repealed).

1975, c. 30, s. 24; 1994, c. 47, s. 25.

25. Where the fiscal year of an operator comprises fewer than 12 months, the amount determined under subparagraph a or b of paragraph 1 of section 21 shall be reduced by the proportion of the amount that the number of days by which 365 exceeds the number of days in the fiscal year is of 365.

1975, c. 30, s. 25; 1994, c. 47, s. 26; 1999, c. 83, s. 16.

26. (Repealed).

1975, c. 30, s. 26; 1994, c. 47, s. 27.

DIVISION V.0.1 ADDITIONAL DEPRECIATION ALLOWANCE

1997, c. 85, s. 25.

26.0.1. Subject to section 26.0.2, the amount deductible by an operator as an additional depreciation allowance, in relation to a processing plant, in computing annual profit for a fiscal year under subparagraph h.1 of paragraph 2 of section 8, shall not exceed the lesser of

(1)  the aggregate of the amounts each of which is 15 % of the capital cost to the operator of each property, described in the second paragraph, in relation to that processing plant;

(2)  $50,000,000;

(3)  the amount by which the aggregate of all amounts each of which is an amount allowed, in relation to that processing plant, under subparagraph h.1 of paragraph 2 of section 8 in computing the annual profit of the operator for a preceding fiscal year is exceeded by the lesser of

(a)  the aggregate of the amounts each of which is the capital cost to the operator of each property, described in the second paragraph, in relation to that processing plant; and

(b)  $350,000,000;

(4)  an amount that is the amount by which 65 % of the annual profit of the operator for the fiscal year, determined before deductions as a processing allowance, additional depreciation allowance and additional allowance for a northern mine referred to in subparagraphs h, h.1 and j of paragraph 2 of section 8 exceeds the amount deducted for the fiscal year under that subparagraph h; and

(5)  zero, if the aggregate of all amounts, each of which is the capital cost to the operator of each property, described in the second paragraph, in relation to that processing plant, is less than $300,000,000.

Property to which the first paragraph refers is property of the third class, within the meaning assigned by section 9, that

(1)  was acquired new by the operator after 25 March 1997 and before 1 April 1998, otherwise than as property to replace or modernize any other property;

(2)  was used for the first time by the operator after 25 March 1997 and before 1 April 1998; and

(3)  is regularly used by the operator in the fiscal year and is in the operator’s possession at the end of that year.

1997, c. 85, s. 25; 2001, c. 51, s. 6.

26.0.2. Where the fiscal year of an operator comprises fewer than 12 months, the amount referred to in subparagraph 2 of the first paragraph of section 26.0.1 and each of the amounts determined under subparagraphs 1 and 3 of that paragraph shall be reduced respectively by the proportion of those amounts that the number of days by which 365 exceeds the number of days in the fiscal year is of 365.

1997, c. 85, s. 25.

26.0.3. Where in a fiscal year an operator is associated, within the meaning of Chapter IX of Title II of Book I of Part I of the Taxation Act (chapter I-3), with one or more other operators, each of the amounts referred to in subparagraph 2 and subparagraph b of subparagraph 3 of the first paragraph of section 26.0.1 shall be allocated among the operators in the proportion established pursuant to an agreement a copy of which shall be sent to the Minister within six months after the end of their fiscal year and the amount allocated or the aggregate of the amounts allocated shall be equal to, for an amount referred to in that subparagraph 2, $50,000,000 and, for the amount referred in that subparagraph b, $350,000,000.

In the absence of an agreement, or if the proportion is not established in a reasonable manner, the Minister shall allocate each of the amounts referred to in subparagraph 2 and subparagraph b of subparagraph 3 of the first paragraph of section 26.0.1 as is reasonable in the circumstances.

1997, c. 85, s. 25.

DIVISION V.1 ADDITIONAL ALLOWANCE FOR A NORTHERN MINE

1996, c. 4, s. 8.

26.1. The amount that an operator may deduct as an additional allowance for a northern mine in computing his annual profit for a particular fiscal year, under subparagraph j of paragraph 2 of section 8, shall not exceed the lesser of the following amounts:

(1)  the operator’s annual profit, for the particular fiscal year, determined without reference to subparagraph j of paragraph 2 of section 8;

(2)  the cumulative northern mine expenses at the end of the particular fiscal year.

Notwithstanding the first paragraph, where the particular fiscal year ends after the ninth fiscal year following the fiscal year during which the operator begins processing ore from the northern mine, the operator may not deduct any amount for the particular fiscal year under subparagraph j of paragraph 2 of section 8.

1996, c. 4, s. 8.

26.2. Cumulative northern mine expenses, at any time, are the amount by which

(1)  the aggregate of all amounts each of which is 1662/3% of the capital cost to the northern mine operator of each asset situated in Québec that is used immediately before that time in processing ore from the mine, and that is acquired after 9 May 1995 and before that time,

exceeds

(2)  the aggregate of all amounts each of which is an amount granted to the operator, for a fiscal year ending before that time, as an additional allowance for a northern mine under subparagraph j of paragraph 2 of section 8.

1996, c. 4, s. 8.

26.3. For the purposes of sections 26.1 and 26.2, where an operator, hereinafter called the “new operator”, obtains as a result of a distribution or acquires, at a particular time, an asset situated in Québec that is used in processing ore from a northern mine of a particular operator, and where such operator has deducted an amount under subparagraph j of paragraph 2 of section 8,

(1)  each fiscal year ending after the fiscal year during which the particular operator begins processing ore from the northern mine and before the particular time is deemed to be a fiscal year of the new operator, and the new operator is deemed to have begun processing ore from the northern mine at the same time as the particular operator began processing ore;

(2)  the capital cost of the asset to the particular operator, immediately before the particular time, is deemed to be, at the particular time, the capital cost of that asset to the new operator;

(3)  the part of each of the amounts that may reasonably be considered to relate to the asset distributed to or acquired by the new operator, and that is deducted by the particular operator under subparagraph j of paragraph 2 of section 8 for a fiscal year ending before the particular time as an additional allowance for a northern mine, is deemed to be an amount granted for that fiscal year to the new operator under the said subparagraph j.

1996, c. 4, s. 8.

DIVISION VI

Repealed, 1994, c. 47, s. 27.

1994, c. 47, s. 27.

27. (Repealed).

1975, c. 30, s. 27; 1985, c. 39, s. 4; 1989, c. 43, s. 2; 1994, c. 47, s. 27.

27.1. (Repealed).

1985, c. 39, s. 5; 1989, c. 43, s. 3; 1994, c. 47, s. 27.

28. (Repealed).

1975, c. 30, s. 28; 1994, c. 47, s. 27.

29. (Repealed).

1975, c. 30, s. 29; 1994, c. 47, s. 27.

CHAPTER IV COMPUTATION OF DUTIES

30. The amount that an operator is required to pay, under section 5, as duties payable for a fiscal year, is equal to 12% of his annual profit for that fiscal year.

1975, c. 30, s. 30; 1979, c. 74, s. 2; 1985, c. 39, s. 6; 1994, c. 47, s. 28.

CHAPTER V CREDIT ON DUTIES

1985, c. 39, s. 6.

DIVISION I CREDIT ON DUTIES AND DEFERRABLE CREDIT ON DUTIES

1985, c. 39, s. 6.

31. (Repealed).

1975, c. 30, s. 31; 1985, c. 39, s. 6; 1994, c. 47, s. 29.

31.1. An operator may deduct from his duties payable under section 5, for a particular fiscal year not later than the third fiscal year following the fiscal year ending on or after 12 May 1994 and including that date, an amount not exceeding 2/3 of the aggregate of

(1)  the total of the amounts each of which is, for a fiscal year not prior to the third fiscal year preceding the particular fiscal year, other than the fiscal year ending after 12 May 1994 and including that date, the amount by which the amount determined under paragraph b of section 31, as it read before 13 May 1994, exceeds the amount deducted as credit on duties under section 31, as it read before 13 May 1994, for that fiscal year, except to the extent that such excess amount has been taken into account in establishing the amount deducted from the duties payable, under this section, for a fiscal year preceding the particular fiscal year; and

(2)  the amount by which the proportion of the amount determined under paragraph b of section 31, as it read before 13 May 1994, that the number of days in the fiscal year preceding 13 May 1994 is of the number of days in that fiscal year ending after 12 May 1994 and including that date, exceeds the proportion of 18% of the annual profit for that fiscal year that the number of days in that fiscal year preceding 13 May 1994 is of the number of days in that fiscal year, except to the extent that such excess amount has been taken into account in establishing the amount deducted from the duties payable by the operator, under this section, for a fiscal year preceding the particular fiscal year.

1985, c. 39, s. 6; 1994, c. 47, s. 30.

31.2. (Repealed).

1985, c. 39, s. 6; 1994, c. 47, s. 31.

DIVISION II CREDIT ON DUTIES REFUNDABLE FOR LOSSES

1985, c. 39, s. 6.

32. An operator who sustains an annual loss in a fiscal year may claim, on or before the date on or before which he is required to file his return under section 36 for that fiscal year, an amount as a credit on duties refundable for losses which shall not exceed

(1)  for a fiscal year ending before 13 May 1994, 18% of the lesser of

(a)  the annual loss for that fiscal year; and

(b)  the aggregate of

i.  subject to paragraph c of section 27, as it read before 13 May 1994, the total of the amounts each of which is an amount deducted for that fiscal year, under paragraph m or n of section 8, as it read before 13 May 1994, as mining exploration and development expenses incurred after 23 April 1985 by an operator for work carried out in Québec, except expenses incurred for work carried out in respect of the mining of surface mineral substances, as defined in section 1 of the Mining Act (chapter M-13.1), and the mining of mineral substances the rights in or over which have been surrendered to the owner of the soil as provided in section 5 of that Act; and

ii.  the amount deducted by the operator for that fiscal year in respect of property actually used by him in Québec, as a depreciation allowance under paragraph o of section 8, as it read before 13 May 1994, from which amount shall be deducted the part thereof relating to property acquired before 24 April 1985;

(2)  for a fiscal year ending after 12 May 1994, 12% of the lesser of

(a)  the adjusted annual loss for that fiscal year; and

(b)  the total of the following amounts, without however exceeding the amount deducted by the operator under subparagraph e of paragraph 2 of section 8 in computing the operator’s annual profit for that fiscal year :

i.  the amount that is the amount by which the expenses in respect of exploration, mineral deposit evaluation and mine development work, incurred by the operator for the fiscal year in connection with mining operation, exceeds the amount of government assistance that the operator received or was entitled to receive for that fiscal year and that relates to those expenses, and provided that such expenses, notwithstanding section 16.2, have been declared by the operator to be deductible expenses, on or before the date on or before which the operator is required to file the operator’s return, in accordance with section 36, for that fiscal year, and

ii.  the total of all amounts each of which is the amount by which an amount referred to in subparagraph b.1 of paragraph 1 of section 16.1 that relates to expenses incurred by the operator during that fiscal year and declared by the operator to be deductible expenses, on or before the date provided in subparagraph i, exceeds the amount that is 25% of the government assistance that the operator received or was entitled to receive for that fiscal year and that relates to those expenses.

1975, c. 30, s. 32; 1985, c. 39, s. 6; 1994, c. 47, s. 32; 1999, c. 83, s. 17.

32.0.1. For the purposes of subparagraph a of paragraph 2 of section 32, the adjusted annual loss of an operator for a fiscal year is the amount by which the annual loss, for that fiscal year, exceeds the lesser of

(1)  the amount determined under section 21 for that fiscal year, as if the said section were read without reference to paragraph 2 thereof; and

(2)  65% of the annual loss sustained by the operator for that fiscal year.

1994, c. 47, s. 33.

32.1. (Repealed).

1985, c. 39, s. 6; 1994, c. 47, s. 34.

DIVISION II.1 CREDIT ON DUTIES FOR THE COST OF BRINGING AN OREBODY INTO PRODUCTION

1996, c. 4, s. 9.

32.2. In this division,

“plan to bring an orebody into production” means a plan submitted by a qualified operator, describing all the property and work necessary to bring an orebody situated in Québec into production;

“prior ministerial approval” means a written confirmation by the Minister, sent to a qualified operator not later than 31 December 2005 subject to the availability of sums appropriated for the purposes of this division, that the operator’s plan to bring an orebody into production and the related feasibility study have been found to be consistent with the objectives of this division, following examination of the plan and study and of any additional study or information considered necessary by the Minister for granting his approval;

“qualified expense” means the cost of a qualified operator’s property that is a road, a building, or equipment other than service property, and that is property

(1)  described in the operator’s plan to bring an orebody into production that has received prior ministerial approval;

(2)  acquired and used by the operator after the prior ministerial approval and before the third fiscal year following the fiscal year during which the operator has received, as a result of a qualified investment, the sums necessary to finance the work and property described in the operator’s plan to bring an orebody into production;

(3)  used by the operator in the exploitation of the orebody that has been brought into production, and that is in regular use for a period of 730 consecutive days beginning on the day after the day on which its utilization begins or, if exploitation of the orebody ceases for economic reasons, for such shorter period as is reasonable in the circumstances;

“qualified investment” means the acquisition of a qualified security issued by a qualified operator by a qualified investor as first purchaser if, as a result of such acquisition, the investor does not exercise control over more than 50% of the voting rights attached to the operator’s outstanding securities;

“qualified investor” means a specified financial institution within the meaning of section 1 of the Taxation Act (chapter I-3) or an institution or body constituted under one of the following Acts:

(1)  the Act respecting the Caisse de dépôt et placement du Québec (chapter C-2);

(2)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

(3)  the Supplemental Pension Plans Act (chapter R-15.1);

(4)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2);

“qualified operator” means an operator who is a legal person if, during the fiscal year preceding the fiscal year during which prior ministerial approval is granted to the operator or, in the event of the operator’s first fiscal year, at the beginning of the operator’s first fiscal year,

(1)  the aggregate of the assets of the operator and of a legal person related to the operator, or the aggregate of the net shareholders’ equity and the net shareholders’ equity of a legal person related to the operator, as shown in the financial statements presented to the shareholders, is less than $50,000,000 or $40,000,000, respectively;

(2)  the operator’s activities are principally carried on in Québec or the operator’s head office is in Québec;

“qualified security” means a security recognized as such in the trade, the rights attached to which do not include the right to redeem the security less than four years after its issue, but does not include an instrument evidencing a loan of money than an unsecured bond that is convertible into a security that is a share.

1996, c. 4, s. 9; 1999, c. 40, s. 111; 2002, c. 40, s. 15.

32.3. The department shall pay, to a qualified operator, the amount determined under section 32.4 as an advance on the credit on duties for the cost of bringing an orebody into production if the operator

(1)  has submitted a plan to bring an orebody into production, supported by a feasibility study prepared by a person who is not related to the operator;

(2)  has submitted, with his plan to bring an orebody into production, a prescribed form, duly completed;

(3)  has obtained the capital from a qualified investment within six months from the date of the prior ministerial approval, or within such longer period as the Minister considers reasonable.

1996, c. 4, s. 9.

32.4. The amount paid under section 32.3 to a qualified operator as an advance on the credit on duties for the cost of bringing an orebody into production is the lesser of the following amounts:

(1)  12% of the aggregate of all amounts each of which is the estimated cost of a property that is a road, a building, or equipment, other than service property, described in the operator’s plan to bring an orebody into production;

(2)  12% of the capital from the qualified investment;

(3)  $3,000,000.

1996, c. 4, s. 9.

32.5. The Minister shall determine, after the fourth fiscal year following the fiscal year during which a qualified operator has received an amount under section 32.3, the amount of the credit on duties for the cost of bringing an orebody into production to which the operator is entitled, which is the lesser of the following amounts:

(1)  12% of the aggregate of all amounts each of which is a qualified expense of the operator;

(2)  12% of the capital from the qualified investment;

(3)  $3,000,000.

1996, c. 4, s. 9.

32.6. A qualified operator must reimburse any amount by which the amount received as an advance, under section 32.3, exceeds the lesser of the following amounts:

(1)  the amount determined under section 32.5;

(2)  zero, if, during the period beginning after the day preceding the date of the prior ministerial approval and ending before the fifth fiscal year following the fiscal year during which the operator has received an amount under section 32.3,

(a)  the operator has made a substantial disbursement in favour of his shareholders, a legal person related to him, the qualified investor or the shareholders of the qualified investor that effected the qualified investment, or in favour of persons related to such shareholders, qualified investor or qualified operator, except a disbursement previously authorized by the Minister;

(b)  the operator has purchased by agreement or redeemed a qualified security issued by him as part of the qualified investment;

(c)  the operator did not adhere to the plan to bring an orebody into production;

(d)  the operator’s interest in a property referred to in the definition of “qualified expense” in section 32.2 is less than 30%;

(e)  the qualified investor controls more than 50% of the voting rights attached to the outstanding securities of the operator;

(f)  a legal person that does not otherwise qualify as a qualified operator acquires control of the operator;

(3)  zero, if the operator obtained prior ministerial approval on the basis of false or deceiving information that misled the Minister.

1996, c. 4, s. 9.

DIVISION III CREDIT ON DUTIES FOR LOSSES

1985, c. 39, s. 6.

33. An operator may deduct from his duties payable under section 5,

(1)  for a particular fiscal year ending before 13 May 1994,

(a)  18% of the amount by which the annual loss for a fiscal year, that is not earlier than the seventh fiscal year preceding the particular fiscal year, exceeds the allowable amount, determined under section 32.1 as it read before 13 May 1994, for that fiscal year;

(b)  18% of the amount by which the annual loss for a fiscal year, that is not later than the third fiscal year following the particular fiscal year, exceeds the allowable amount, determined under section 32.1 as it read before 13 May 1994, for that fiscal year, provided that the operator indicates in his return, filed on or before 12 May 1994, his intention of deducting the excess amount from his duties payable for that particular fiscal year;

(2)  for a particular fiscal year ending after 12 May 1994, 12% of the amount by which the annual loss for a fiscal year ending before 13 May 1994, that is not earlier than the seventh fiscal year preceding the particular fiscal year, exceeds the allowable amount, determined under section 32.1 as it read before 13 May 1994, for that fiscal year.

1975, c. 30, s. 33; 1979, c. 74, s. 3; 1985, c. 39, s. 6; 1994, c. 47, s. 35.

DIVISION IV ORDER OF APPLICATION

1985, c. 39, s. 6.

34. Every person or partnership required to file a return for a fiscal year, under section 36 or 37, shall indicate therein the order of application of the credits determined under sections 31.1 and 33, for that fiscal year.

1975, c. 30, s. 34; 1979, c. 74, s. 4; 1985, c. 39, s. 6; 1994, c. 47, s. 36.

34.1. Notwithstanding section 31.1, no operator may deduct any amount as deferrable credit on duties for a fiscal year until he has used in full all the amounts deductible as deferrable credit on duties for previous fiscal years.

1985, c. 39, s. 6.

34.2. Notwithstanding section 33, no operator may deduct any amount as credit on duties for losses in respect of a loss sustained in a fiscal year until he has used in full all the deductions as credit on duties for losses in respect of losses sustained in previous fiscal years.

1985, c. 39, s. 6.

DIVISION V

Repealed, 1994, c. 47, s. 37.

1985, c. 39, s. 6; 1994, c. 47, s. 37.

35. (Repealed).

1975, c. 30, s. 35; 1985, c. 39, s. 6; 1994, c. 47, s. 37.

35.1. (Repealed).

1985, c. 39, s. 6; 1994, c. 47, s. 37.

CHAPTER V.1 AMALGAMATION AND ACQUISITION OF ASSETS

1994, c. 47, s. 38.

DIVISION I AMALGAMATION

1994, c. 47, s. 38.

35.2. Where an amalgamation takes place, the fiscal year of each predecessor legal person that is an operator referred to in section 5 is deemed to end immediately before the amalgamation and the first fiscal year of the new legal person is deemed to begin at the time of the amalgamation.

1994, c. 47, s. 38; 1996, c. 4, s. 11.

35.3. The following rules apply in the case of an amalgamation referred to in section 35.2 for the purposes of fiscal years ending after the amalgamation:

(1)  each property of each class described in section 9 belonging to a predecessor legal person immediately before the amalgamation is deemed

(a)  to have been acquired by the new legal person at the time at which the predecessor legal person acquired it; and

(b)  to have a capital cost to the new legal person equal to its capital cost to the predecessor legal person;

(2)  each of the amounts deducted or included in determining the undepreciated capital cost of property of a class of a predecessor legal person, and each of the amounts that would have been deducted or included by the predecessor legal person in determining such undepreciated capital cost for the first fiscal year ending after the amalgamation, assuming there were such a fiscal year, are deemed to be amounts deducted or included by the new legal person in determining the undepreciated capital cost of property of that class;

(3)  each of the amounts incurred before the amalgamation by a predecessor legal person as an expense referred to in subparagraph a or b of paragraph 1 of section 16.1, or allowed the predecessor legal person as a deduction in computing its annual profit under paragraphs m, n and o of section 8 as they read before 13 May 1994, or under subparagraph e of paragraph 2 of section 8, is deemed to be an amount so incurred by the new legal person or an amount so allowed the new legal person as a deduction;

(4)  each of the amounts that is an expense described in section 18 incurred by a predecessor legal person during the period beginning on 1 April 1975 and ending on 12 May 1994 or an expense in respect of which an investment allowance was claimed by the predecessor legal person is deemed to be, for the new legal person, an expense incurred or an expense in respect of which an investment allowance was claimed;

(5)  each of the amounts incurred before the amalgamation by a predecessor legal person in respect of exploration and underground core drilling work carried out in Québec and referred to in subparagraph a of paragraph 1 of section 19.2, or allowed the predecessor legal person as a deduction in computing its annual profit under subparagraph g of paragraph 2 of section 8, is deemed to be an amount so incurred by the new legal person or an amount so allowed the new legal person as a deduction;

(6)  each of the amounts of government assistance received or receivable, or repaid pursuant to an obligation to do so, by a predecessor legal person before the amalgamation is deemed to be an amount received or receivable, or so repaid, by the new legal person;

(7)  for the purposes of Chapter V, the duties payable by a predecessor legal person and the annual profit or the annual loss, as the case may be, of a predecessor legal person for a fiscal year are deemed to be the duties payable by the new legal person and the annual profit or the annual loss, as the case may be, of the new legal person, and the credit on duties, the deferrable credit on duties and the credit on duties refundable for losses and the credit on duties for losses of the predecessor legal person are deemed to be such credits of the new legal person;

(8)  for the purposes of subparagraph d of paragraph 1 of section 8.0.0.1, the cumulative contributions account of a predecessor legal person, determined immediately before the amalgamation, is deemed, immediately after the amalgamation, to be the balance of the cumulative contributions account of the new legal person;

(9)  each of the amounts allowed before the amalgamation to a predecessor legal person, as a deduction in computing annual profit under subparagraph h.1 of paragraph 2 of section 8, is deemed to be an amount so allowed the new legal person as a deduction.

1994, c. 47, s. 38; 1996, c. 4, s. 11; 1996, c. 39, s. 5; 1997, c. 85, s. 26.

DIVISION II ACQUISITION OF ASSETS

1994, c. 47, s. 38.

35.4. Where a person or a partnership, hereinafter referred to as the “purchaser”, acquires, after 12 May 1994, property described in section 9, otherwise than as part of an amalgamation, from another person or partnership to whom the operator is related, hereinafter referred to as the “former owner”, the following rules apply to fiscal years ending after the acquisition of the property:

(1)  the property is deemed to have been alienated by the former owner for an amount equal to the proportion of the undepreciated capital cost of the class of property which includes the property, determined immediately before the acquisition, that the capital cost of the property to the former owner is of the aggregate of all amounts each of which is the capital cost of a property of that class;

(2)  subject to paragraphs 3, 4 and 6, the property is deemed to have been acquired by the purchaser at a capital cost equal to the amount determined under paragraph 1;

(3)  for the purposes of section 21, the capital cost of the property to the purchaser is deemed to be equal to the capital cost of the property to the former owner;

(4)  where the cost of the property to the purchaser exceeds the capital cost of the property to the former owner immediately before the acquisition, the capital cost of the property to the purchaser is deemed to be equal to the capital cost of the property to the former owner immediately before that time;

(5)  for the purposes of the definition of “undepreciated capital cost” in section 9, where the capital cost of the property to the former owner exceeds the amount determined under paragraph 1, the capital cost of the property to the purchaser is deemed to be the capital cost of the property to the former owner and the excess amount is deemed to have been allowed to the purchaser as a depreciation allowance in respect of the property for the fiscal years preceding the purchaser’s acquisition of the property;

(6)  for the purposes of section 26.0.1, where the purchaser acquired from the former owner all or substantially all of the property of the third class referred to in that section that was owned by him immediately before the acquisition,

(a)  the property is deemed to have a capital cost to the purchaser equal to the capital cost of the property to the former owner;

(b)  the property is deemed to have been acquired new by the purchaser at the same time as the property was acquired new by the former owner;

(c)  the property is deemed to have been used for the first time by the purchaser at the same time as the property was used for the first time by the former owner; and

(d)  each of the amounts allowed to the former owner as an additional depreciation allowance under subparagraph h.1 of paragraph 2 of section 8 is deemed to have been so allowed to the purchaser as a deduction.

1994, c. 47, s. 38; 1997, c. 85, s. 27; 2001, c. 51, s. 7; 2002, c. 40, s. 16.

35.5. Subject to section 35.4, where at a particular time a person or partnership that is an operator receives from a person a dividend payable in kind consisting of property described in section 9, the person or partnership is deemed to have acquired the property at a cost equal to its fair market value at that time, and if the person paying the dividend is also an operator, that person is deemed to have alienated the property at the same time for proceeds equal to its fair market value.

1994, c. 47, s. 38.

CHAPTER VI ADMINISTRATIVE PROCEDURE AND APPEALS

DIVISION I RETURNS

36. Every operator shall, within six months after the end of its fiscal year, file with the Minister a return of its annual profit or annual loss on the form prescribed by the Minister, with a copy of the financial statements of the undertaking and the relevant schedules.

The Minister may, where the Minister deems it appropriate for the operators as a whole, extend the time fixed for the filing of returns.

1975, c. 30, s. 36; 1985, c. 39, s. 7; 1994, c. 47, s. 39.

36.1. Every person or partnership whether or not liable to pay duties, and whether or not a return has been filed, shall, on demand from the Minister sent by registered or certified mail or served personally, send to the Minister a return on the form prescribed by the Minister for the fiscal year and within the time mentioned in the demand.

1994, c. 47, s. 39.

37. Every person administering, winding-up or controlling in any manner whatever the property, business, succession or income of an operator who has not filed the return mentioned in section 36 for a fiscal year, shall file such return for that fiscal year.

1975, c. 30, s. 37; 1989, c. 54, s. 168; 1994, c. 47, s. 40; 1996, c. 4, s. 12; 1999, c. 40, s. 111.

38. Every person required to file a return under this division shall in such return estimate the amount of the duties payable.

1975, c. 30, s. 38; 1982, c. 3, s. 1; 1994, c. 47, s. 41.

DIVISION II ASSESSMENTS

39. The Minister shall examine each return sent to him for a fiscal year and determine the duties payable for the fiscal year, interest and penalties, if any, and also the annual profit, the annual loss, the credit on duties, the deferrable credit on duties, the adjusted annual loss, the credit on duties refundable for losses and the credit on duties for losses, if any.

1975, c. 30, s. 39; 1985, c. 39, s. 8; 1994, c. 47, s. 42.

40. After examination of a return, the Minister shall send a notice of assessment to the person by whom the return was filed.

1975, c. 30, s. 40.

41. The liability of an operator for the duties provided for by this Act is not affected by an incorrect or incomplete assessment or by the fact that no assessment has been made.

1975, c. 30, s. 41.

42. The Minister may at any time assess duties, interest and penalties under this Act, or notify in writing any person by whom a return has been filed for a fiscal year that no duty is payable for that fiscal year.

1975, c. 30, s. 42.

43. The Minister may re-determine the duties, interest and penalties, if any, and also the annual profit, the annual loss, the credit on duties, the deferrable credit on duties, the allowable amount, the adjusted annual loss, the credit on duties refundable for losses and the credit on duties for losses, if any, and make a reassessment or an additional assessment, as the case may be,

(1)  at any time, if the operator or the person who filed the return

(a)  has made a misrepresentation that is attributable to neglect or wilful default or has committed fraud in filing the return or in supplying information required under this Act; or

(b)  has filed with the Minister a waiver on the form prescribed by the Minister within four years from the day of mailing of a notice of original assessment or of a notification that no duty is payable for a fiscal year;

(2)  within seven years from the day of mailing of a notice of original assessment or of a notification that no duty is payable for a fiscal year if the operator

(a)  has amended the return for that fiscal year in accordance with section 43.2; or

(b)  would have amended the return for that fiscal year pursuant to section 43.2 had the time prescribed in that section not expired;

(3)  within four years of the day referred to in paragraph 2 in all other cases.

1975, c. 30, s. 43; 1985, c. 39, s. 9; 1994, c. 47, s. 43.

43.0.1. The Minister may re-determine the credit on duties for the cost of bringing an orebody into production and make a reassessment

(1)  at any time, if the operator who obtained, under section 32.3, an advance on the credit on duties for the cost of bringing an orebody into production

(a)  has made a misrepresentation that is attributable to negligence or wilful default or has committed any fraud in supplying any information required under Division II.1 of Chapter V; or

(b)  has filed a waiver with the Minister using the form prescribed by the Minister;

(2)  within four years from the day of mailing of the statement determining, in accordance with section 32.5, the amount of the credit on duties for the cost of bringing an orebody into production, in all other cases.

1996, c. 4, s. 10.

43.1. Where the Minister has re-determined the duties, interest, penalties, deferrable credit on duties and credit on duties for losses pursuant to paragraph 2 of section 43, the operator may object to the assessment and appeal to the Court of Québec in accordance with the provisions of this Act only on the grounds pertaining to the deductions provided for in sections 31.1 and 33.

1985, c. 39, s. 10; 1988, c. 21, s. 66; 1994, c. 47, s. 43.

43.2. An operator who sustains an annual loss in a fiscal year may amend the return he has filed for a previous fiscal year only for the purposes of claiming or changing a deduction provided for in section 33 and changing a deduction provided for in section 31.1, by sending a claim to the Minister on the form prescribed by the Minister before 12 May 1994 and within three years from the day on or before which he was required to file the return or, if he filed it before the time limit prescribed by law, from that day.

The Minister shall then re-determine the duties payable and the interest and penalties, if any, the deferrable credit on duties and the credit on duties for losses for the previous fiscal year and for any relevant fiscal year not prior to that year.

1985, c. 39, s. 10; 1994, c. 47, s. 43.

44. The Minister is not bound by a return filed or by the information supplied by or on behalf of an operator, and may, notwithstanding the return or information or if no return has been filed, assess the duties payable.

1975, c. 30, s. 44.

45. An assessment shall, subject to being varied or vacated on an objection or appeal and subject to a reassessment, be deemed to be valid and binding notwithstanding any error, defect or omission therein or in any proceeding relating thereto.

1975, c. 30, s. 45.

DIVISION III PAYMENT OF DUTIES

46. Every operator liable to pay duties under this Act shall pay to the Minister, in respect of a fiscal year commencing after 31 March 1981,

(1)  the following amounts:

(a)  on or before the last day of each month of the current fiscal year, an amount equal to 1/12 of the estimated duties for the fiscal year in accordance with section 38 or of his first basic provisional account determined in the manner provided for in section 46.0.1 for the fiscal year; or

(b)  on or before the last day of the first two months of the current fiscal year, an amount equal to 1/12 of his second basic provisional account determined in the manner provided for in section 46.0.2 for the fiscal year and, on or before the last day of each of the following months of the fiscal year, an amount equal to 1/10 of the amount by which his first basic provisional account referred to in subparagraph a exceeds the amount determined for the first two months of the fiscal year; and

(2)  on or before the last day of the period ending two months after the end of his fiscal year, the balance of his duties estimated in accordance with section 38 for the fiscal year.

1975, c. 30, s. 46; 1982, c. 3, s. 2; 1994, c. 47, s. 44.

46.0.1. For the purposes of subparagraph a of paragraph 1 of section 46, the first basic provisional account of an operator for a fiscal year is the proportion of the operator’s duties payable for the preceding fiscal year that 365 is of the number of days in the fiscal year.

1994, c. 47, s. 45.

46.0.2. For the purposes of subparagraph b of paragraph 1 of section 46, the second basic provisional account of an operator for a fiscal year is its first basic provisional account for the preceding fiscal year.

1994, c. 47, s. 45.

46.0.3. Notwithstanding section 46.0.1, where the preceding fiscal year of an operator comprises less than 183 days, its first basic provisional account for the fiscal year is equal to the higher of the amount determined under section 46.0.1 and the amount that would be determined thereunder if “preceding fiscal year” were a reference to the last fiscal year of the operator which comprised more than 182 days.

1994, c. 47, s. 45.

46.0.4. Notwithstanding sections 46.0.1 and 46.0.2, for the purposes of the first fiscal year of a new legal person resulting from an amalgamation within the meaning of section 1,

(1)  the first basic provisional account of the new legal person for the fiscal year is the aggregate of all amounts each of which would be the first basic provisional account of a predecessor legal person for the fiscal year; and

(2)  the second basic provisional account of the new legal person for the fiscal year is the aggregate of all amounts each of which is the first basic provisional account of a predecessor legal person for its fiscal year preceding the fiscal year.

1994, c. 47, s. 45; 1996, c. 4, s. 11.

46.0.5. Notwithstanding sections 46.0.1 and 46.0.3, for the purposes of the second fiscal year of a new legal person referred to in section 46.0.4, where the preceding fiscal year of the new legal person comprised less than 183 days, the first basic provisional account of the new legal person for its second fiscal year is equal to the higher of the amount determined under section 46.0.1 and its first basic provisional account for the preceding fiscal year.

1994, c. 47, s. 45; 1996, c. 4, s. 11.

46.0.6. For the purposes of paragraph 1 of section 46.0.4, where the last fiscal year of a predecessor legal person comprises less than 183 days, the first basic provisional account for the first fiscal year of the new legal person is equal to the higher of the amount determined under section 46.0.1 and the first basic provisional account of the predecessor legal person for the preceding fiscal year.

1994, c. 47, s. 45; 1996, c. 4, s. 11.

46.1. Every operator who is entitled to a credit under section 32 is deemed to have paid to the Minister, in respect of the fiscal year referred to therein, in addition to the amounts paid pursuant to section 46, an amount equal to that determined by the Minister as a credit on duties refundable for losses.

1989, c. 43, s. 4.

47. Every operator shall, before the twenty-first day of the month following the month in which a notice of assessment is mailed to it, pay to the Minister the duties, interest and penalties indicated in the notice then remaining unpaid, whether or not an objection or appeal from the assessment is pending.

1975, c. 30, s. 47; 1994, c. 47, s. 46.

47.1. For the purpose of computing the exigible interest, where an operator pays to the Minister all or part of the amount the operator is required to pay following a notice of assessment, the date of payment is deemed to be the date of mailing of the notice of assessment if the payment is made before the twenty-first day of the month following the month in which the notice of assessment was mailed.

The same rule applies where the payment is made by remittance to the Minister, before the day referred to in the first paragraph, of a negotiable instrument falling due before that day.

1994, c. 47, s. 46.

48. Where, in the opinion of the Minister, an operator is attempting to avoid payment of duties, the Minister may direct that all duties, including interest and penalties, be paid immediately on assessment.

1975, c. 30, s. 48.

49. Every person required, by section 37, to file the return of another person for a fiscal year shall, before the twenty-first day of the month following the month in which a notice of assessment is mailed, pay all duties, interest and penalties, exigible from or in respect of that other person, to the extent that the person is or was at any time since the fiscal year in possession or control of property belonging to that other person or that other person’s succession; the person is deemed thereupon to have made the payment on behalf of that other person.

1975, c. 30, s. 49; 1994, c. 47, s. 47; 1999, c. 40, s. 111.

DIVISION IV INTEREST

50. Where, on the date of expiry of the time allowed for paying to the Minister the balance of his estimated duties for the fiscal year, the amount paid by an operator as duties payable for a fiscal year is less than the amount of duties payable for that fiscal year, the person liable to pay the duties shall pay interest, at the rate fixed under section 28 of the Act respecting the Ministère du Revenu (chapter M-31), on the difference between those two amounts, for the period extending from the date of expiry of the time allowed for paying to the Minister the balance of the estimated duties to the day of payment; if no amount has been paid by the operator, the interest is exigible on the total amount of duties payable for the same period.

1975, c. 30, s. 50; 1994, c. 47, s. 48.

51. In addition to the interest payable under section 50, an operator liable to make a payment under section 46 shall pay interest on any payment or part of a payment he has not made on or before the date of expiry of the time allowed therefor, at the rate fixed under section 28 of the Act respecting the Ministère du Revenu (chapter M-31), for the period extending from that date to the day of payment or to the day he becomes liable to pay interest under section 50, whichever is earlier.

1975, c. 30, s. 51; 1994, c. 47, s. 48.

52. For the purposes of section 51, an operator required to make a payment for a fiscal year under section 46 is deemed to have been liable to make payments based on one of the methods described in paragraph 1 of section 46 that gives the lowest amount to be paid on or before each of the dates referred to in the said paragraph, by reference to

(1)  his estimated duties for the current fiscal year or his first basic provisional account within the meaning of section 46.0.1 for the fiscal year; or

(2)  his second basic provisional account within the meaning of section 46.0.2 for the fiscal year and his first basic provisional account for the fiscal year.

1975, c. 30, s. 52; 1994, c. 47, s. 48.

52.0.1. Notwithstanding sections 51 and 52, the interest payable by an operator under the said sections shall not exceed the amount by which the interest that would be payable by the operator under the said sections if he had made no payments exceeds the amount obtained by computing interest at the rate fixed under section 28 of the Act respecting the Ministère du Revenu (chapter M-31) capitalized daily on each payment made by the operator, for the period extending from the day of the payment to the day on or before which the operator is required to pay to the Minister the balance of his estimated duties payable or would be so required if he had such a balance.

1994, c. 47, s. 49.

52.0.2. Every operator required to make a payment under section 46 shall pay, in addition to interest payable under section 51, additional interest at the rate of 10% per annum, for the period for which interest is payable under section 51, on each unpaid payment or part of a payment that is less than 90% of the payment the operator was required to make.

1994, c. 47, s. 49.

52.0.3. Notwithstanding section 52.0.2, the interest payable by an operator under the said section shall not exceed the amount by which the interest that would be payable by the operator under the said section if the operator had made no payments exceeds the amount obtained by computing interest at the rate of 10% capitalized daily on each payment made by the operator, for the period extending from the day of the payment to the day on or before which the operator is required to pay to the Minister the balance of the operator’s estimated duties payable or would be so required if the operator had such a balance.

1994, c. 47, s. 49.

52.0.4. Sections 28 and 28.1 of the Act respecting the Ministère du Revenu (chapter M-31), adapted as required, apply to the computation of interest for the purposes of this Act.

1994, c. 47, s. 49.

52.1. Where an operator sustains an annual loss in a fiscal year, the duties payable for a previous fiscal year in respect of which a claim was directly or indirectly filed under section 43.2 are deemed, for the purposes of computing the interest payable under sections 50 and 51, to be equal to the duties the operator would have had to pay if no claim had been directly or indirectly filed under section 43.2 in respect of a previous fiscal year.

The duties referred to in the first paragraph are, however, deemed to be payable only in respect of the period ending on the latest of the following dates:

(a)  the day on which the claim was directly or indirectly filed for the previous fiscal year;

(b)  the day on or before which a return was required to be filed for the fiscal year in which the operator sustained the annual loss;

(c)  the day on which the return was filed.

1985, c. 39, s. 11.

DIVISION V PENALTIES

53. Every person who fails to make a return on the form prescribed by the Minister and within the prescribed time limits, in accordance with sections 36 to 38, is liable to a penalty of $10 a day for every day the omission continues, up to an amount of $2,000.

1975, c. 30, s. 53; 1985, c. 39, s. 12; 1994, c. 47, s. 50.

54. Every person who fails to furnish on the form prescribed by the Minister the information required under sections 36 to 38 is liable to a penalty of $10 a day for every day the omission continues, up to an amount of $2,000.

1975, c. 30, s. 54; 1985, c. 39, s. 13; 1994, c. 47, s. 51.

55. A person who has wilfully and in any manner evaded or attempted to evade payment of the duties payable by the person for a fiscal year or part thereof is liable to a penalty equal to 50 per cent of the amount the payment of which the person evaded or attempted to evade.

1975, c. 30, s. 55; 1994, c. 47, s. 52.

56. If a person, knowingly or under circumstances amounting to gross negligence, makes a statement or omission in a return, certificate or answer made or filed under this Act, or participates therein or assents thereto, as a result of which the duties that would be payable if the person were assessed on the basis of the information furnished are less that the duties actually payable, the person is liable to a penalty of 25% of the difference between such two amounts.

1975, c. 30, s. 56.

57. For the purposes of an appeal brought under this Act respecting a penalty, the burden of establishing the facts contemplated in sections 55 and 56 is on the Minister.

1975, c. 30, s. 57.

DIVISION VI REFUNDS

58. Where an operator has filed a return for a fiscal year and has paid for that year as duties, interest or penalty an amount greater than that which was exigible, the Minister may refund the excess to the operator at the same time as the Minister sends the operator the notice of assessment for that fiscal year.

The Minister shall make the refund provided for in the first paragraph if the operator applies for it within 4 years after the end of the fiscal year concerned or where paragraph 2 of section 43 applies, within 7 years after the end of the fiscal year concerned; in other cases, the Minister may make the refund.

1975, c. 30, s. 58; 1985, c. 39, s. 14; 1994, c. 47, s. 53.

58.1. That portion of the refund to which an operator is entitled pursuant to section 58, which is equal to the amount determined under section 46.1, constitutes the refundable credit on duties provided for in section 32.

1989, c. 43, s. 5.

59. Where an operator entitled to a refund under section 58 is also a debtor under this Act or is about to be a debtor, the Minister may apply such refund to the payment of the debt of such operator, up to the amount of such debt, and notify the operator accordingly.

1975, c. 30, s. 59.

59.0.1. The Minister may determine that a refund due to an operator by reason of the application of this Act may be allocated to the payment of any amount for which the operator is indebted under an Act or program coming under the administration of the Minister.

In such a case, the Minister shall

(1)  first, make, where appropriate, the allocation provided for in the first paragraph;

(2)  then, inform the operator of the amount allocated to the existing debt;

(3)  pay the balance of the refund to the operator entitled thereto; and

(4)  send to the operator, whether or not any amount is paid to the operator, a notice containing a detailed account of the sums allocated.

1994, c. 47, s. 54; 1999, c. 83, s. 18.

59.0.2. Where an operator who owes an amount exigible under this Act is also the creditor or beneficiary of an amount payable under an Act or program coming under the administration of the Minister, the Minister may allocate all or part of the amount to the payment of the debt up to the full amount of the debt.

1994, c. 47, s. 54; 1999, c. 83, s. 18.

59.1. Where the Minister, by mistake or on the basis of incorrect or incomplete information, has refunded to an operator or has applied to the operator’s liability an amount greater than the amount that should have been refunded or applied, the excess shall be exigible from the date on which it was paid or applied by the Minister and the Minister may, at any time, assess the operator for that amount.

However, if the Minister considers that the excess was not refunded or applied on the basis of incorrect or incomplete information supplied by the operator, the excess shall be exigible from the date of the mailing of the notice of assessment.

1985, c. 39, s. 15.

59.2. Any amount that the Minister, by mistake or on the basis of incorrect or incomplete information, has refunded to an operator as a refundable credit on duties and that the Minister collects subsequently shall form part of the Consolidated Revenue Fund.

1985, c. 39, s. 15.

60. Where an overpayment by an operator is refunded or allocated to another liability, interest shall be paid to the operator on the amount of the overpayment for the period ending on the day of such refund or allocation and commencing on the latest of

(1)  the day on which the overpayment was made following a notice of assessment;

(2)  the forty-sixth day following the day on which the overpayment was made otherwise than following a notice of assessment;

(3)  the forty-sixth day following the day on or before which the return giving rise to the overpayment was required to be filed under section 36;

(4)  the forty-sixth day following the day on which, pursuant to section 36, the operator filed the return giving rise to the overpayment, except where the return was filed on the day on or before which it was required to be filed; and

(5)  where an overpayment is determined for a fiscal year following an application for the amendment of a return filed under section 36, 36.1 or 37 for the fiscal year, the forty-sixth day following the day on which the Minister received the application in writing.

For the purposes of this section, the overpayment referred to in the first paragraph must be reduced by an amount equal to that determined by the Minister as a credit on duties refundable for losses.

1975, c. 30, s. 60; 1989, c. 43, s. 6; 1994, c. 47, s. 55.

60.1. Where an operator sustains an annual loss in a fiscal year, that part of an overpayment made by the operator for a previous fiscal year resulting directly or indirectly from the filing of a claim pursuant to section 43.2 is deemed, for the purposes of section 60, to have been paid on the latest of the following dates:

(a)  the day following the day on which the claim was directly or indirectly filed for the previous fiscal year;

(b)  the day following the day on or before which a return was required to be filed for the fiscal year in which the operator sustained the annual loss;

(c)  the day following the day on which the return was filed.

1985, c. 39, s. 16.

60.2. Any interest payable in respect of a refund made by the Minister under this Act shall be paid out of the Consolidated Revenue Fund.

1985, c. 39, s. 16; 1989, c. 43, s. 7.

60.3. Any amount owed under this Act as a refund is inalienable and unseizable.

1994, c. 47, s. 56.

DIVISION VII OBJECTIONS

61. An operator who objects to an assessment under this Act may, within ninety days from the day of mailing of the notice of assessment, serve on the Minister a notice of objection in duplicate on the form prescribed by the Minister setting out the reasons for the objection and all relevant facts.

1975, c. 30, s. 61; 1994, c. 47, s. 57.

62. A notice of objection under section 61 shall be served by being sent by registered or certified mail addressed to the Minister.

1975, c. 30, s. 62; 1975, c. 83, s. 84.

63. Upon receipt of the notice of objection, the Minister shall with all due dispatch reconsider the assessment and vacate, confirm or vary the assessment or reassess and send a notice of the decision to the operator by registered or certified mail.

1975, c. 30, s. 63; 1975, c. 83, s. 84.

64. Section 61 does not apply to the new assessment contemplated in section 63.

1975, c. 30, s. 64.

65. A reassessment made by the Minister pursuant to section 63 is not invalid by reason only of not having been made in the seven-year period prescribed in paragraph 2 of section 43, where that paragraph applies, or in the four-year period prescribed in paragraph 3 of section 43, in other cases.

1975, c. 30, s. 65; 1985, c. 39, s. 17; 1994, c. 47, s. 58.

66. The Minister may accept a notice of objection under this division even if such notice was not served in duplicate or in the manner required by section 61.

1975, c. 30, s. 66.

DIVISION VIII APPEALS

67. Where an operator has served a notice of objection under section 61, the operator may appeal to the Court of Québec sitting for the district in which the operator’s residence or establishment is situated to have the assessment vacated or varied after either

(a)  the Minister has confirmed the assessment or reassessed; or

(b)  one hundred and eighty days have elapsed after service of the notice of objection and the Minister has not notified the operator that the Minister has vacated or confirmed the assessment or reassessed.

An operator who has objected to an assessment referred to in section 61 may appeal only in respect of the issues specified in the notice of objection.

1975, c. 30, s. 67; 1988, c. 21, s. 66; 1996, c. 4, s. 13; 2002, c. 40, s. 17.

68. No appeal under section 67 may be instituted after the expiry of ninety days from the day notice has been mailed to the operator under section 63 that the Minister has confirmed the assessment or reassessed.

1975, c. 30, s. 68.

69. An assessment shall not be vacated or varied on appeal by reason only of any irregularity, informality, omission or error on the part of anyone in the observance of any non-peremptory provision of this Act.

1975, c. 30, s. 69.

70. The appeal provided for by section 67 shall be brought, heard and decided in accordance with Chapter III.2 of the Act respecting the Ministère du Revenu (chapter M‐31) and that chapter applies, with the necessary modifications, to such appeal and to an appeal before the Court of Appeal.

The motion before the Court of Québec shall be directed against the Deputy Minister of Natural Resources and Wildlife and service thereof shall be made upon him or upon a person having charge of his office.

1975, c. 30, s. 70; 1979, c. 81, s. 20; 1988, c. 21, s. 66; 1994, c. 13, s. 15; 1997, c. 85, s. 28; 2003, c. 8, s. 6; 2006, c. 3, s. 35.

DIVISION IX WAIVER AND CANCELLATION

2001, c. 51, s. 8.

70.1. The Minister may waive all or any portion of any interest or penalty provided by law.

The Minister may also cancel all or any portion of any interest or penalty payable under the law.

No objection or appeal lies from the Minister’s decision.

A statistical summary of all waivers and cancellations under this section shall be tabled each year before the National Assembly within the first 15 days of the following session.

2001, c. 51, s. 8.

CHAPTER VII ENFORCEMENT AND ADMINISTRATION

DIVISION I BOOKS, ACCOUNTS AND REPORTS

71. Every operator shall keep records and books of account, including a yearly inventory, at the operator’s residence or establishment or at any other place designated by the Minister.

1975, c. 30, s. 71; 1994, c. 47, s. 59; 1996, c. 4, s. 14.

72. The records and books referred to in section 71 shall be kept in the proper form and contain the information necessary to establish the amounts of the duties which must be paid pursuant to this Act.

1975, c. 30, s. 72.

73. Where an operator fails to keep the appropriate records and books of account, the Minister may require the operator to keep such records and books of account as the Minister may specify and the operator shall comply with such obligation.

1975, c. 30, s. 73.

74. Any person required under this Act to keep records and books of account shall retain them as well as the invoices and any other voucher in support of the information they contain, for four years after the date of the first notice of assessment issued in respect of the fiscal year to which they pertain.

1975, c. 30, s. 74; 1994, c. 47, s. 60.

74.1. An operator subject to this division who has served a notice of objection in respect of an assessment or is a party to an appeal brought under this Act shall retain all records, books of account and vouchers necessary for the examination of the objection or the appeal until the time for appeal has expired or until the judgment on the appeal has been rendered and, where applicable, until any other time for appeal has expired or the judgment on it has been rendered.

1994, c. 47, s. 60.

DIVISION II AUDIT AND INVESTIGATIONS

75. Any person authorized for that purpose by the Minister may, for any purpose connected with the administration or enforcement of this Act, at all reasonable times, enter into any premises or place where any business relating to mining is carried on or any property is kept or any books or records are or should be kept pursuant to this Act.

The person so authorized may:

(a)  audit or examine the books and records and any account, voucher, letter, telegram or other document which relates or may relate to the information that is or should be in the books or records, and make copies of any document which the person thinks necessary;

(b)  examine any process or method an examination of which may assist the person in verifying the amount of duties payable under this Act;

(c)  require the owner or manager of the property or business and any other person on the premises to give the person all reasonable assistance with the audit or examination and to answer all proper questions relating to the audit or examination, either orally or, should the said authorized person so require, in writing, on oath and, for that purpose, require the owner or manager to attend at the premises with the person; and

(d)  if, during the course of an audit or examination, the person believes on reasonable grounds that there has been a violation of this Act or of a regulation, take samples, seize and remove any records, books, accounts, vouchers, letters, telegrams and other documents required as evidence of the offence and retain them until they are submitted in evidence in judicial proceedings, in which case the clerk becomes the custodian thereof.

1975, c. 30, s. 75; 1986, c. 95, s. 131; 1992, c. 61, s. 270; 1999, c. 40, s. 111.

75.1. Every person exercising a power of inspection under this Act shall, on request, identify himself and produce a certificate of capacity signed by the Minister.

1986, c. 95, s. 132.

76. The Minister may designate in writing any functionary of the Ministère des Ressources naturelles et de la Faune or any person to make a search in accordance with the Code of Penal Procedure (chapter C-25.1).

The functionary or person may be accompanied by a peace officer.

1975, c. 30, s. 76; 1977, c. 5, s. 14; 1979, c. 81, s. 20; 1986, c. 95, s. 133; 1992, c. 61, s. 271; 1994, c. 13, s. 15; 2003, c. 8, s. 6; 2006, c. 3, s. 35.

77. (Repealed).

1975, c. 30, s. 77; 1986, c. 95, s. 134; 1992, c. 61, s. 272.

78. The Minister shall, upon request, allow the examination of any document, book, register, paper or other thing seized under section 75, by its owner or the person in whose hands it was at the time of the seizure.

1975, c. 30, s. 78; 1992, c. 61, s. 273.

79. The Minister may, by a formal demand delivered by registered or certified mail or personal service, require that a person file by registered or certified mail or personal service, within a reasonable time fixed by the Minister:

(a)  information or additional information, including a return, report or supplementary return or report exigible under this Act; or

(b)  books, letters, accounts, invoices, financial statements or other documents.

1975, c. 30, s. 79; 1975, c. 83, s. 84; 1999, c. 40, s. 111.

80. The person to whom the demand referred to in section 79 is made must, within the time fixed, comply with that demand, whether or not the information or documents have already been filed.

1975, c. 30, s. 80; 1999, c. 40, s. 111.

80.1. Where a person has not complied with a formal demand in respect of information or a document, any court shall, on motion of the Minister, prohibit introduction of such information or document as evidence unless the person establishes that the demand was unreasonable under the circumstances.

1994, c. 47, s. 61.

DIVISION II.1 CONFIDENTIAL INFORMATION

1994, c. 47, s. 62.

80.2. All information obtained under this Act is confidential. No person holding or having held a position in the Ministère des Ressources naturelles et de la Faune may use such information for any purpose other than the purposes of this Act, communicate such information or allow it to be communicated to a person not legally entitled thereto or allow such a person to examine a document containing such information or to have access to it.

However, information concerning the operator may, upon a written request by the operator or the operator’s authorized representative, be communicated to a person or body designated in the request.

1994, c. 47, s. 62; 2003, c. 8, s. 6; 2006, c. 3, s. 35.

80.3. Notwithstanding section 9 of the Act respecting Access to documents held by public bodies and the Protection of personal information (chapter A-2.1) and subject to sections 80.2, 80.4 and 80.5, no person has a right of access to the documents and information obtained under this Act.

1994, c. 47, s. 62.

80.4. For the purposes of section 80.2 and notwithstanding section 23 of the Act respecting Access to documents held by public bodies and the Protection of personal information (chapter A-2.1), a person mentioned in the second paragraph is entitled, to the extent provided, to examine information obtained under this Act and the Minister may communicate such information or allow it to be communicated to such person.

The persons are

(1)  the Auditor General, in respect of audits and inquiries necessary in the performance of the duties of office;

(2)  the Minister of Finance, in respect of the information necessary to evaluate and formulate the fiscal policy of the Government.

No information so obtained may be disclosed in any manner.

1994, c. 47, s. 62.

80.5. Notwithstanding section 23 of the Act respecting Access to documents held by public bodies and the Protection of personal information (chapter A-2.1) and section 80.2 of this Act, the Minister may, according to law and on a reciprocal basis, make an agreement with a government in Canada for an exchange of information or documents obtained under an Act that provides for the imposition of a duty, royalty or tax.

1994, c. 47, s. 62.

80.6. Subject to section 80.7 and notwithstanding any other Act, in the case of judicial proceedings other than criminal or penal proceedings, no person holding or having held a position in the Ministère des Ressources naturelles et de la Faune may be summoned or is authorized to testify in respect of information referred to in section 80.2 or to produce a document containing such information or a document obtained or written by or on behalf of the Minister for the purposes of this Act.

1994, c. 47, s. 62; 2003, c. 8, s. 6; 2006, c. 3, s. 35.

80.7. Section 80.6 does not apply to proceedings between an operator and the Deputy Minister or to an appeal to the Commission de la fonction publique under the Public Service Act (chapter F-3.1.1) or to other proceedings in matters of labour relations between the Department and one of its employees, but the Minister, the Deputy Minister and the Assistant Deputy Ministers of the Department are not compellable; they shall, however, upon a written request by a party served at least 30 days before the date of the hearing and specifying the facts concerning which a testimony is required, designate a public servant having knowledge of the facts to testify.

Where the Commission de la fonction publique, another labour relations authority party to proceedings between the Department and one of its employees or a board of inquiry established by the Government requires a public servant to testify before it, the testimony is given and, if applicable, documents are produced exclusively behind closed doors, and such testimony and documents shall not be mentioned in any document, report, stenographic notes or recording of that Commission, authority or board or mentioned at its other public sittings or sittings behind closed doors.

1994, c. 47, s. 62.

DIVISION III RECOVERY

81. Where an amount payable under this Act has not been paid, in whole or in part, the Minister may issue a certificate attesting that such debt is payable and the amount thereof, and such certificate shall be proof that the debt is payable.

1975, c. 30, s. 81.

82. The certificate referred to in section 81 may be issued by the Minister at any time after the expiry of thirty days following the date when the debt was payable or, in the case of an order referred to in section 48, immediately following such order.

1975, c. 30, s. 82.

83. Upon the filing in the office of the competent court of a certificate referred to in section 81, the clerk shall endorse thereon the date of its filing and shall render judgment in favour of the Attorney General for the amount provided in the certificate, with interest and penalties, if any, and costs against the person liable to pay the debt.

Such judgment is equivalent to and has all the effects of a judgment rendered by a competent court except in respect of the interest on the amount awarded, which shall be computed at the rate fixed under section 28 of the Act respecting the Ministère du Revenu (chapter M-31) and capitalized daily.

1975, c. 30, s. 83; 1994, c. 47, s. 63; 1996, c. 4, s. 15.

83.1. Any sum due under this Act constitutes a debt for the operator and a claim in favour of the Minister.

The claim in favour of the Minister gives rise to a legal hypothec in accordance with article 2724 of the Civil Code on all the property of the debtor.

1994, c. 47, s. 64.

DIVISION IV PENAL PROVISIONS

1992, c. 61, s. 274.

84. Any person who contravenes the first paragraph of section 80.2 is guilty of an offence and is liable to a fine of not more than $5,000.

1975, c. 30, s. 84; 1990, c. 4, s. 399; 1994, c. 47, s. 65.

85. Whoever has failed to file a return on the form prescribed by the Minister and within the time provided for by this Act is guilty of an offence and is liable to a fine of not less than $25 per day of omission.

1975, c. 30, s. 85; 1990, c. 4, s. 399; 1994, c. 47, s. 66; 1999, c. 40, s. 111.

86. Every person who has not complied with or has contravened the provisions of sections 71 to 76, 79 and 80, or who hinders or attempts to hinder in any manner whatever any person carrying out an action required or authorized under this Act is guilty of an offence and, in addition to any penalty provided by any other provision of this Act, is liable to a fine of not less than $200 nor more than $10,000.

1975, c. 30, s. 86; 1990, c. 4, s. 400.

87. Whoever

(a)  makes or participates in, assents to or acquiesces in the making of false or deceptive statements in a return, report, certificate, statement or answer filed or made as required under this Act or a regulation;

(b)  to evade payment of a duty, destroys, alters, mutilates or secretes or otherwise disposes of the registers, books of account or other documents of a person subject to this Act;

(c)  makes, or assents to or acquiesces in the making of, false or deceptive entries, or omits or assents to or acquiesces in the omission to enter a material particular in the records or books of account of a person subject to this Act;

(d)  wilfully, in any manner, evades or attempts to evade compliance with this Act or payment of a duty imposed under it; or

(e)  conspires with a person to commit an offence described in paragraphs a to d,

is guilty of an offence and, in addition to any other penalty provided by any other provision of this Act, is liable to a fine of $200 to $10,000.

1975, c. 30, s. 87; 1990, c. 4, s. 401.

88. The fines provided by section 87 may be imposed even in the case where, after an offence contemplated therein has been committed, no additional duty is payable.

Where an additional duty is payable after an offence contemplated in section 87 has been committed, the fine must be at least equal to 25 per cent of the amount of the duties which such person evaded or attempted to evade or permitted to be evaded, without exceeding twice such amount.

1975, c. 30, s. 88.

89. A person convicted of an offence under section 87 is not liable, for the same tax evasion or attempted tax evasion, to any penalty provided by sections 55 and 56 unless it was imposed on the person before proceedings were instituted under section 87.

1975, c. 30, s. 89.

90. (Repealed).

1975, c. 30, s. 90; 1990, c. 4, s. 402.

91. Subject to the other provisions of this Act, the exercising of any recourse against a person shall not affect the right to exercise against the same person any other civil or penal recourse under this Act.

1975, c. 30, s. 91.

92. Where a legal person is guilty of an offence against this Act or a regulation, any person who directed, authorized, assented to, acquiesced in or participated in the commission of the offence, is deemed to have been a party to the offence and is liable to the penalty provided for the offence, whether or not the legal person has been prosecuted or convicted.

1975, c. 30, s. 92; 1996, c. 4, s. 11.

93. Any person who contravenes this Act or a regulation otherwise than in the cases referred to in sections 84 to 92, is guilty of an offence and is liable to a fine of $25.

1975, c. 30, s. 93; 1990, c. 4, s. 399.

DIVISION V REGULATIONS

94. In addition to the powers specifically conferred upon it by this Act, the Government may make the regulations necessary to prescribe the evidence required for the establishment of facts pertaining to assessments and generally, to prescribe the measures required for the application of this Act.

The regulations made under this section and those made under other provisions of this Act shall come into force on the date of their publication in the Gazette officielle du Québec or on any later date fixed therein; they may also, once published and if they so provide, apply from the commencement of any fiscal year which begins in the calendar year current at the time when they are made.

1975, c. 30, s. 94.

CHAPTER VIII FINAL PROVISIONS

95. Sections 72 to 92 of the Act respecting the Ministère du Revenu apply with the necessary modifications to procedure and proof in the case of a contestation by virtue of this Act.

1975, c. 30, s. 95.

96. The Minister shall be responsible for the application of this Act.

1975, c. 30, s. 96; 1979, c. 81, s. 20; 1994, c. 13, s. 15; 1999, c. 83, s. 18.

97. The Deputy Minister of Natural Resources and Wildlife may exercise all the powers and discharge all the duties vested in the Minister under this Act.

1975, c. 30, s. 97; 1979, c. 81, s. 20; 1994, c. 13, s. 15; 2003, c. 8, s. 6; 2006, c. 3, s. 35.

98. (Repealed).

1975, c. 30, s. 107; 1989, c. 43, s. 8.

99. (This section ceased to have effect on 17 April 1987).

1982, c. 21, s. 1; U. K., 1982, c. 11, Sch. B, Part I, s. 33.

REPEAL SCHEDULE

In accordance with section 17 of the Act respecting the consolidation of the statutes (chapter R-3), chapter 30 of the statutes of 1975, in force on 31 December 1977, is repealed, except sections 98 to 103, 103a, 104 to 106, 108 and 109, effective from the coming into force of chapter D-15 of the Revised Statutes.