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The determination of whether a building is considered to have become available for use by a taxpayer is a question of fact that can only be resolved by examining all of the relevant facts of the particular situation. ... " Subsection 127(11.2) of the Act provides that: "For the purpose of this section and section 127.1, property described in subparagraph (a)(f) of the definition "investment tax credit" in subsection (9) shall be deemed not to have been acquired, and expenditures made to acquire property described in subparagraph 37(l)(b)(i) shall be deemed not to have been made, by a taxpayer before the property is considered to have become available for use by the taxpayer, determined without reference to paragraphs 13(27)(c) and (28)(d). ... As for Yco, since the property will not be considered to have been acquired for use by Xco, it will be entitled to the investment tax credits to the extent it satisfies all the other requirements and conditions of subsections 127(9) and 127(11.2) of the Act. ...

A corporation's business will be considered to have been carried on in Canada if at least 50% of its employees are engaged in the business in Canada or at least 50% of its salaries or wages are paid for services provided in Canada in respect of the business. If the corporation is part of a group of related corporations, the combined services of their employees and the combined salaries and wages paid must be considered in making this determination. ... Due to the detail and complexity of the Regulations regarding these issues, the foregoing comments are meant only to provide an overview of the relevant provisions and under no circumstances are they to be considered to be either comprehensive or all inclusive. ...

You have requested our comments related to the following questions: 1) Will the shares of Holdco be considered to be shares of a small business corporation as defined in subsection 248(1) of the Act and as such be considered to be QSBC's in the above situation? ... The partnership interest and the loan to the partnership will both be considered to be "assets that were used in an active business carried on primarily in Canada by the particular corporation." As such, provided the other requirements in the definition of QSBCS in subsection 110.6(1) are met, the shares of Holdco will be considered to be QSBCS's. 2) Our policy as stated in the answer to question 51 of the 1986 Conference Report Round Table remains in effect. ...

It is also indicated in paragraph 4 of IT-447 that "...the residence of the beneficiaries of a trust and domicile of the settlor are not considered to be relevant except in situations as described in (paragraph) 5... ... In these situations the residence of this...person may be considered to be the determining factor for the trust regardless of any contrary provisions in the trust agreement. ... " It is also stated in paragraph 11 of IT-447 that other factors may be considered where the purported residence of a trust or estate appears to have been motivated by reasons of tax avoidance. ...

Further, please comment on whether control would be considered to be acquired by a "group" of persons for the purposes of subsections 111(4) and (5) in the following situations: (a)     If an arm's-length lender acquires shares of a corporation for the purpose of securing a loan, when would the lender be considered to be part of a "group" controlling the corporation? ... In response to your specific questions: (a)     Whether the lender would be considered to be part of a group that controls the corporation would depend on the circumstances of the particular situation, including the percentage of shares owned by the lender, who the other shareholders are, the relationship between the lender and the other shareholders, etc. ... (d)     If A Co and C Co act in concert to control Opco, they would be considered to be a group of persons that had acquired control of Opco. ...

However, it is not necessary for a corporation in a situation such as yours to have surrendered its charter before a bad debt is considered to exist. ... Comments concerning when a debt is considered to be "bad" have also been included in paragraph 9 of IT-159R2 and paragraph 6 of IT-442. ... It is not necessary that the corporation be bankrupt or formally dissolved to be considered to have permanently ceased to carry on its business. ...

Where it is received as a shareholder, C.C.A. will be restricted pursuant to the paid paragraph of the Regulations unless the property is considered to be used primarily for business purposes. Generally, the property will be considered to be used primarily for business purposes if it is so used for more than 50% of the time. ... Where it is received as a shareholder, the carrying charges including interest will not be deductible unless the property is considered to be used primarily for business purposes. ...

Oulton (613)995-1787 RE Further to our memorandum dated June 15, 1984 and yours of April 2, 1984 we have considered further the question of whether XXXX is entitled to the inventory allowance on the portion of its inventory for which it has received progress payments. ... We have considered the arguments made by XXXX with repsect to "possession, use and risk" and the reference to paragraph 15 of Interpretation Bulletin IT-435R. ... We have also considered the character of the progress payments received for purposes of section 12. ...

Does the Department of National Revenue think that the partners' activities were sufficiently developed for them not to be considered as specified members? ... Department of National Revenue response In order to determine whether the activities of members are sufficiently developed for them not to be considered as "specified members", the particular facts of a situation must be reviewed as a whole. ... On the facts described above, it seems to us that the members' activities do not meet the criteria mentioned earlier and accordingly they would be considered "specified members". ...

A corporation's business will be considered to have been carried on in Canada if at least 50% of its employees are engaged in the business in Canada or at least 50% of its salaries or wages are paid for services provided in Canada in respect of the business. If the corporation is part of a group of related corporations, the combined services of their employees and the combined salaries and wages paid must be considered in making this determination. ... Due to the detail and complexity of the Regulations regarding these issues, the foregoing comments are meant only to provide an overview of the relevant provisions and under no circumstances are they to be considered to be either comprehensive or all inclusive. ...