Bill C-393
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2nd Session, 35th Parliament, 45-46 Elizabeth II, 1996-97
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The House of Commons of Canada
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BILL C-393 |
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An Act to amend the Income Tax Act
(business limit)
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| R.S., c. 1 (5th
Supp.); 1994,
cc. 7, 8, 13,
21, 29, 38, 41;
1995, cc. 1, 3,
11, 18, 21, 38,
46; 1996, cc.
11, 21, 23
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1. Subsections 125(2), (3) and (4) of the
Income Tax Act are replaced by the
following:
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| Interpreta- tion of ``business limit''
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(2) For the purposes of this section, a
corporation's ``business limit'' for a taxation
year prior to 1997 is $200,000 and is $300,000
for the 1997 or subsequent taxation years,
unless the corporation is associated in the year
with one or more other Canadian-controlled
private corporations in which case, except as
otherwise provided in this section, its business
limit for the year is nil.
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| Associated
corporations
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(3) Notwithstanding subsection (2), if all of
the Canadian-controlled private corporations
that are associated with each other in a
taxation year have filed with the Minister in
prescribed form an agreement whereby, for
the purposes of this section, they allocate an
amount to one or more of them for the taxation
year and the amount so allocated or the total
of the amounts so allocated, as the case may
be, is $200,000 in respect of a taxation year
prior to 1997 or $300,000 in respect of the
1997 or subsequent taxation years , the
business limit for the year of each of the
corporations is the amount so allocated to it.
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| Failure to file
agreement
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(4) If any of the Canadian-controlled
private corporations that are associated with
each other in a taxation year has failed to file
with the Minister an agreement as
contemplated by subsection (3) within 30 days
after notice in writing by the Minister has been
forwarded to any of them that such an
agreement is required for the purposes of any
assessment of tax under this Part, the Minister
shall, for the purpose of this section, allocate
an amount to one or more of them for the
taxation year, which amount or the total of
which amounts, as the case may be, shall equal
$200,000 in respect of a taxation year prior to
1997 or $300,000 in respect of the 1997 or
subsequent taxation years, and in any such
case, notwithstanding subsection (2), the
business limit for each of the corporations is
the amount so allocated to it.
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