Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
DRAFT
Tax Executive Institute
Annual Tax Conference
May, 1996
Question No. 4
Assessments
Currently, Part 1 and Part 1.3 taxes, among others, are both assessed on one Notice of Assessment. When a corporation incurs a non-capital loss in a given taxation year and therefore has no tax liability under Part 1 of the Income Tax Act but has a tax liability under Part 1.3 of the Act,
a)Does the Minister consider this assessment to be a nil assessment for Part 1 purposes?
b)Can the corporation file a Notice of Objection for that particular year in respect of the calculation of the loss under Part 1 or does it have to wait until that loss is being utilized?
c)Does the Minister consider that year to be a "taxable year" for purposes of the revision of capital cost allowance claims and other permissive deductions as explained in Information Circular 84-1?
DEPARTMENT'S POSITION
It is the Department's position that an assessment under each Part of the Income Tax Act stands on its own. Although a single Notice of Assessment may be used to inform the taxpayer of assessments under more than one Part of the Income Tax Act, they should be regarded as separate assessments.
a)When the corporation has incurred a non-capital loss and consequently has no tax liability under Part 1, the assessment with respect to Part 1 of the Act would be considered a nil assessment.
b)The corporation is precluded from filing a Notice of Objection in respect of the year that the non-capital loss is assessed. The corporation may, however, request a loss Determination in respect of the non-capital loss in a taxation year and may formally object and appeal such a Determination.
c)Within the context of the administrative positions set out in Information Circular 84-1, the terms "taxable year" or "non-taxable year" as used in paragraphs 9 and 10, refer to taxability under Part 1 of the Income Tax Act.
Author:J.A. Szeszycki
File:961405
Date:April 30, 1996
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