| Tax credit
|
(3) Where
|
|
|
|
(a) a qualified corporation for a taxation
year files with its return of income for the
year
|
|
|
|
(i) a Canadian film or video production
certificate issued in respect of a Canadian
film or video production of the
corporation,
|
|
|
|
(ii) a prescribed form containing
prescribed information, and
|
|
|
|
(iii) each other document prescribed in
respect of the production, and
|
|
|
|
(b) the principal filming or taping of the
production began before the end of the year,
|
|
|
|
the corporation is deemed to have paid, on the
day referred to in paragraph 157(1)(b) on or
before which the corporation would be
required to pay the remainder of its tax
payable under this Part for the year if such a
remainder were payable, an amount on
account of its tax payable under this Part for
the year equal to 25% of its qualified labour
expenditure for the year in respect of the
production.
|
|
| Exception
|
(4) This section does not apply to a
Canadian film or video production where an
investor, or a partnership in which an investor
has an interest, directly or indirectly, may
deduct an amount in respect of the production
in computing its income for any taxation year.
|
|
| When
assistance
received
|
(5) For the purposes of this Act other than
this section, and for greater certainty, the
amount that a corporation is deemed under
subsection (3) to have paid for a taxation year
is assistance received by the corporation from
a government immediately before the end of
the year.
|
|
| Revocation of
a certificate
|
(6) A Canadian film or video production
certificate in respect of a production may be
revoked by the Minister of Canadian Heritage
where
|
|
|
|
(a) an omission or incorrect statement was
made for the purpose of obtaining the
certificate, or
|
|
|
|
(b) the production is not a Canadian film or
video production,
|
|
|
|
and, for the purpose of subparagraph (3)(a)(i),
a certificate that has been revoked is deemed
never to have been issued.
|
|
|
|
(2) Subsection (1) applies to the 1995 and
subsequent taxation years except that, in
applying the definition ``qualified
corporation'' in subsection 125.4(1) of the
Act, as enacted by subsection (1), in respect
of a film or video production the principal
photography of which began before July
1996, the words ``are primarily'' in that
definition shall be read as ``include''.
|
|
|
|
29. (1) Paragraphs (b) and (c) of the
definition ``tax for the year otherwise
payable under this Part'' in subsection
126(7) of the Act are replaced by the
following:
|
|
|
|
(b) in subparagraph (2)(c)(i) and
paragraph (2.2)(b), the tax for the year
payable under this Part (determined
without reference to sections 120.1,
120.3 and 123.3 and before making any
deduction under any of sections 121,
122.3, 124 to 127 and 127.2 to 127.41),
and
|
|
|
|
(c) in subsection (2.1), the tax for the year
payable under this Part (determined
without reference to subsection 120(1)
and sections 120.1, 120.3 and 123.3 and
before making any deduction under any
of sections 121, 122.3, 124 to 127 and
127.2 to 127.41);
|
|
|
|
(2) Subsection (1) applies to taxation
years that end after June 1995.
|
|
|
|
30. (1) Subparagraph 127(5)(a)(i) of the
Act is replaced by the following:
|
|
|
|
(i) the taxpayer's investment tax credit at
the end of the year in respect of property
acquired before the end of the year or of
the taxpayer's SR&ED qualified
expenditure pool at the end of the year or
of a preceding taxation year, and
|
|
|
|
(2) Clause 127(5)(a)(ii)(A) of the Act is
replaced by the following:
|
|
|
|
(A) the taxpayer's investment tax
credit at the end of the year in respect
of property acquired in a subsequent
taxation year or of the taxpayer's
SR&ED qualified expenditure pool at
the end of a subsequent taxation year to
the extent that an investment tax credit
was not deductible under this
subsection or subsection 180.1(1.2) for
the subsequent year, and
|
|
|
|
(3) Subsection 127(7) of the Act is
replaced by the following:
|
|
| Investment
tax credit of
testamentary
trust
|
(7) Where, in a particular taxation year of a
taxpayer who is a beneficiary under a
testamentary trust or under an inter vivos trust
that is deemed to be in existence by section
143, an amount is determined in respect of the
trust under paragraph (a), (a.1), (b) or (e.1) of
the definition ``investment tax credit'' in
subsection (9) for its taxation year that ends in
that particular taxation year, the trust may, in
its return of income for its taxation year that
ends in that particular taxation year, designate
the portion of that amount that can, having
regard to all the circumstances including the
terms and conditions of the trust, reasonably
be considered to be attributable to the
taxpayer and was not designated by the trust in
respect of any other beneficiary of the trust,
and that portion shall be added in computing
the investment tax credit of the taxpayer at the
end of that particular taxation year and shall be
deducted in computing the investment tax
credit of the trust at the end of its taxation year
that ends in that particular taxation year.
|
|
|
|
(4) Subparagraph 127(8)(b)(ii) of the Act
is replaced by the following:
|
|
|
|
(ii) paragraph (e.1) of that definition
were read without reference to the words
``the amount of an expenditure made by
the taxpayer under paragraph (11.1)(c)'',
|
|
|
|
(5) Subsection 127(8) of the Act is
replaced by the following:
|
|
| Investment
tax credit of
partnership
|
(8) Where, in a particular taxation year of a
taxpayer who is a member of a partnership, an
amount would be determined in respect of the
partnership, for its taxation year that ends in
the particular year, under paragraph (a), (a.1),
(b) or (e.1) of the definition ``investment tax
credit'' in subsection (9), if
|
|
|
|
(a) except for the purpose of subsection
(13), the partnership were a person and its
fiscal period were its taxation year, and
|
|
|
|
(b) in the case of a taxpayer who is a
specified member of the partnership in the
taxation year of the partnership, that
definition were read without reference to
paragraph (a.1) thereof, and paragraph (e.1)
of that definition were read without
reference to subparagraphs (ii) to (iv)
thereof,
|
|
|
|
the portion of that amount that can reasonably
be considered to be the taxpayer's share
thereof shall be added in computing the
investment tax credit of the taxpayer at the end
of the particular year.
|
|
|
|
(6) The portion of subsection 127(8.1) of
the Act before paragraph (a) is replaced by
the following:
|
|
| Investment
tax credit of
limited
partner
|
(8.1) Where a taxpayer is a limited partner
of a partnership at the end of the partnership's
taxation year, the amount referred to under
subsection (8) as the amount which can
reasonably be considered to be the taxpayer's
share of the amounts that would be determined
under paragraph (a), (a.1), (b) or (e.1) of the
definition ``investment tax credit'' in
subsection (9) in respect of the partnership for
the year shall not exceed the lesser of
|
|
|
|
(7) Subparagraph 127(8.2)(b)(i) of the
Act is replaced by the following:
|
|
|
|
(i) the total of all amounts each of which
is, if the partnership were a person and its
fiscal period were its taxation year,
|
|
|
|
(A) an amount a specified percentage
of which would be determined in
respect of the partnership under
paragraph (a), (b) or (e.1) of the
definition ``investment tax credit'' in
subsection (9) for the year, or
|
|
|
|
(B) the amount that would be the
SR&ED qualified expenditure pool of
the partnership at the end of the year,
and
|
|
|
|
(8) Paragraph 127(8.3)(a) of the Act is
replaced by the following:
|
|
|
|
(a) the amount that would, if the partnership
were a person and its fiscal period were its
taxation year, be determined in respect of
the partnership under paragraph (a), (a.1),
(b) or (e.1) of the definition ``investment tax
credit'' in subsection (9) for a taxation year
|
|
|
|
(9) The definitions ``approved project
property'', ``qualified Canadian
exploration expenditure'', ``qualified
construction equipment'', ``qualified
small-business property'' and ``qualified
transportation equipment'' in subsection
127(9) of the Act are repealed.
|
|
|
|
(10) The definition ``qualified
expenditure'' in subsection 127(9) of the Act
is replaced by the following:
|
|
``qualified
expenditure''
« dépense
admissible »
|
``qualified expenditure'' incurred by a
taxpayer in a taxation year means
|
|
|
|
(a) an amount that is an expenditure
incurred in the year by the taxpayer in
respect of scientific research and
experimental development that is an
expenditure
|
|
|
|
(i) for first term shared-use-equipment
or second term shared-use-equipment,
|
|
|
|
(ii) described in paragraph 37(1)(a), or
|
|
|
|
(iii) described in subparagraph
37(1)(b)(i), or
|
|
|
|
(b) a prescribed proxy amount of the
taxpayer for the year (which, for the
purpose of paragraph (e), is deemed to be
an amount incurred in the year),
|
|
|
|
|
|
|
|
(c) a prescribed expenditure incurred in
the year by the taxpayer,
|
|
|
|
(d) where the taxpayer is a corporation,
an expenditure specified by the taxpayer
for the year for the purpose of clause
194(2)(a)(ii)(A),
|
|
|
|
(e) subject to subsection (11.4), an
amount in respect of which the taxpayer
does not file with the Minister a
prescribed form containing prescribed
information on or before the day that is 12
months after the taxpayer's filing-due
date for the particular taxation year in
which the amount would have been
incurred if this Act were read without
reference to subsections (26) and 78(4)
where the particular year begins after
1995,
|
|
|
|
(f) an expenditure (other than an
expenditure that is salary or wages of an
employee of the taxpayer) incurred by
the taxpayer in respect of scientific
research and experimental development
to the extent that it is performed for or on
behalf of the taxpayer at a time when the
taxpayer and the person or partnership to
which the expenditure is paid or payable
do not deal with each other at arm's
length,
|
|
|
|
(g) an expenditure described in
paragraph 37(1)(a), other than an
expenditure on scientific research and
experimental development directly
undertaken by the taxpayer, that is paid or
payable by the taxpayer to or for the
benefit of a person or partnership that is
not a taxable supplier in respect of the
expenditure, and
|
|
|
|
(h) an amount that would otherwise be a
qualified expenditure incurred by the
taxpayer in the year to the extent of any
reduction in respect of the amount that is
required under any of subsections (18) to
(20) to be applied;
|
|
|
|
(11) Paragraph (a) of the definition
``contract payment'' in subsection 127(9) of
the Act is replaced by the following:
|
|
|
|
(a) an amount paid or payable to a
taxpayer, by a taxable supplier in respect
of the amount, for scientific research and
experimental development to the extent
that it is performed
|
|
|
|
(i) for or on behalf of a person or
partnership entitled to a deduction in
respect of the amount because of
subparagraph 37(1)(a)(i) or (i.1), and
|
|
|
|
(ii) at a time when the taxpayer is
dealing at arm's length with the person
or partnership, or
|
|
|
|
(12) Paragraph (a) of the definition
``investment tax credit'' in subsection
127(9) of the Act is replaced by the
following:
|
|
|
|
(a) the total of all amounts each of which
is the specified percentage of the capital
cost to the taxpayer of certified property
or qualified property acquired by the
taxpayer in the year,
|
|
|
|
(a.1) 20% of the taxpayer's SR&ED
qualified expenditure pool at the end of
the year,
|
|
|
|
(13) Paragraph (c) of the definition
``investment tax credit'' in subsection
127(9) of the Act is replaced by the
following:
|
|
|
|
(c) the total of all amounts each of which
is an amount determined under paragraph
(a), (a.1) or (b) in respect of the taxpayer
for any of the 10 taxation years
immediately preceding or the 3 taxation
years immediately following the year,
|
|
|
|
(14) The portion of the definition
``investment tax credit'' in subsection
127(9) of the Act after paragraph (e) and
before paragraph (g) is replaced by the
following:
|
|
|
|
(e.1) the total of all amounts each of
which is the specified percentage of that
part of a repayment made by the taxpayer
in the year or in any of the 10 taxation
years immediately preceding or the 3
taxation years immediately following the
year that can reasonably be considered to
be a repayment of government
assistance, non-government assistance or
a contract payment that reduced
|
|
|
|
(i) the capital cost to the taxpayer of a
property under paragraph (11.1)(b),
|
|
|
|
(ii) the amount of a qualified
expenditure incurred by the taxpayer
under paragraph (11.1)(c) for taxation
years that began before 1996,
|
|
|
|
(iii) the prescribed proxy amount of
the taxpayer under paragraph (11.1)(f)
for taxation years that began before
1996, or
|
|
|
|
(iv) a qualified expenditure incurred
by the taxpayer under any of
subsections (18) to (20), and
|
|
|
|
(e.2) the total of all amounts each of
which is the specified percentage of 1/4
of that part of a repayment made by the
taxpayer in the year or in any of the 10
taxation years immediately preceding or
the 3 taxation years immediately
following the year that can reasonably be
considered to be a repayment of
government assistance, non-government
assistance or a contract payment that
reduced
|
|
|
|
(i) the amount of a qualified
expenditure incurred by the taxpayer
under paragraph (11.1)(e) for taxation
years that began before 1996, or
|
|
|
|
(ii) a qualified expenditure incurred by
the taxpayer under any of subsections
(18) to (20),
|
|
|
|
in respect of first term
shared-use-equipment or second term
shared-use-equipment, and, for that
purpose, a repayment made by the
taxpayer in any taxation year preceding
the first taxation year that ends
coincidentally with the first period or the
second period in respect of first term
shared-use-equipment or second term
shared-use-equipment, respectively, is
deemed to have been incurred by the
taxpayer in that first taxation year,
|
|
|
|
|
|
|
|
(f) the total of all amounts each of which
is an amount deducted under subsection
(5) from the tax otherwise payable under
this Part by the taxpayer for a preceding
taxation year in respect of property
acquired, or an expenditure incurred, in
the year or in any of the 10 taxation years
immediately preceding or the 2 taxation
years immediately following the year, or
in respect of the taxpayer's SR&ED
qualified expenditure pool at the end of
such a year,
|
|
|
|
(15) Paragraph (g) of the definition
``investment tax credit'' in subsection
127(9) of the Act is amended by adding the
word ``or'' at the end of subparagraph (i),
by repealing subparagraph (ii) and by
replacing subparagraph (iii) with the
following:
|
|
|
|
(iii) at the end of any of the 9 taxation
years immediately preceding or the 3
taxation years immediately following
the year,
|
|
|
|
(16) Paragraph (h) of the definition
``investment tax credit'' in subsection
127(9) of the Act is amended by adding the
word ``or'' at the end of subparagraph (i),
by repealing subparagraph (ii) and by
replacing subparagraph (iii) with the
following:
|
|
|
|
(iii) at the end of any of the 10 taxation
years immediately preceding or the 3
taxation years immediately following
the year,
|
|
|
|
(17) The portion of the definition
``investment tax credit'' in subsection
127(9) of the Act after paragraph (k) is
replaced by the following:
|
|
|
|
except that no amount shall be included in
the total determined under any of
paragraphs (a) to (e.2) in respect of any
qualified expenditure incurred by the
taxpayer in the course of earning income
from a business, or in respect of any
certified property or qualified property
acquired by the taxpayer for use in the
course of earning income from a business,
if any of the income from that business is
exempt from tax under this Part;
|
|
|
|
(18) Subsection 127(9) of the Act is
amended by adding the following in
alphabetical order:
|
|
``SR&ED
qualified
expenditure
pool''
« compte de
dépenses
admissibles de
recherche et
de développe-
ment »
|
``SR&ED qualified expenditure pool'' of a
taxpayer at the end of a taxation year means
the amount determined by the formula
|
|
|
|
A + B - C
|
|
|
|
|
|
|
|
A is the total of all amounts each of which
is a qualified expenditure incurred by the
taxpayer in the year,
|
|
|
|
B is the total of all amounts each of which
is an amount determined under paragraph
(13)(e) for the year in respect of the
taxpayer, and in respect of which the
taxpayer files with the Minister a
prescribed form containing prescribed
information by the day that is 12 months
after the taxpayer's filing-due date for
the year, and
|
|