(a)-(b)

Paragraph 20(1)(a) - Capital cost of property

Revising Claims

Cases

Mattabi Mines Ltd. v. Ontario (Minister of Revenue), [1988] 2 CTC 294, [1988] 2 S.C.R. 175

The taxpayer, which first made a request at trial that it be permitted CCA claims for Ontario purposes in computing its income for 1974 in the event that an investment tax credit should be found to be unavailable, was precluded from doing so in light inter alia of the fact that to permit such a claim would reduce the available level of claims for its 1975 and 1976 taxation years, which were statute-barred. [C.R.: 20(1)(n)]

Administrative Policy

13 March 2012 External T.I. 2012-0432111E5 - Revised joint venture policy

after adverting to the previous withdrawal of its position that joint venture income could be computed as if the joint venture had a separate fiscal period (see 2011-042958), and the resulting requirement that income for the "stub period" be included in income for the first taxation year commencing after March 2, 2011, , CRA stated that

For purposes of calculating the net income for the stub period in accordance with the revised JV administrative policy, the CCA would be allowed based on the period of the incremental income inclusion, as long as all the stub period income is reported on the JV participant's return. For example, if in the case where there was a 12 month period and a 6 month stub period, the CRA recommends that the CCA be computed separately for the 12 month period and 6 month period (i.e., not simply based on an 18 month period).

28 July 1995 T.I. 951955 (C.T.O. "IT-315")

Respecting the acquisition of shares of a corporation that is financed by interest-bearing debt issued by the purchaser to the vending shareholder, RC stated that "the policy expressed in IT-315 is applicable not only to interest on funds borrowed by a taxpayer to finance its share of acquisition ... but also to interest on the unpaid portion of the purchase price of the shares."

88 C.R. - Q.44

Where RC reviews an acquisition of a building which occurred 10 years previously and determines that its capital cost was $50,000, rather than the $200,000 which has been claimed by the taxpayer, then the revised capital cost of $50,000 will be reduced by the actual CCA deducted in each statute-barred year to arrive at a revised UCC opening balance of the class for the first non-statute barred year. Where the revised UCC balance at that time is negative, the recapture will be included in the taxpayer's income.

IC 84-1 "Revision of Capital Cost Allowance Claims and Other Permissive Deductions"

10. Where a taxpayer requests a revision of capital cost allowance claimed in a taxation year for which a notification that no tax is payable had been issued (e.g. because of a non-capital loss in that year, the application of a non-capital loss of another year, or the fact that income was exempt from tax in that year), such request will be allowed provided there is no change in the tax payable for the year or any other year filed, including one that is statute barred, for which the time has expired for filing a notice of objection. Such request will not be allowed, however, where...the Minister has issued a notice of determination pursuant to subsection 152(1.1). A taxpayer who wishes to revise the capital cost allowance in a year for which a notice of determination has been issued should do so within 90 days from the day of mailing the notice of determination for that year.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4) 156

Paragraph 20(1)(bb)

Articles

Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.

Narrow CRA interpretation of principal business test (p. 236)

Since the principal business test in paragraph 20(1)(bb) requires only that the principal business of the service provider include the provision of investment administration or management services, in theory the test should be met when it is established that the service provider has a principal business and that its investment administration or management services are sufficiently interconnected with the activities of its principal business. …

In a 2005 technical interpretation, [CRA] took the position that a service provider whose principal business included the maintenance of account records did not satisfy the test because "[the service provider's] services do not include time spent on the custody of securities, the collection and remittance of income, and the right to buy and sell on [its] own judgment on behalf of some clients without reference to those clients. [F.n. 382 … 2005-0124131E5.]

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(3) 374
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(4) - Paragraph 251.1(4)(d) 437
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) - Paragraph 251.1(1)(g) - Subparagraph 251.1(1)(g)(ii) 115
Tax Topics - Income Tax Act - Section 164 - Subsection 164(6) 141
Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) 331
Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(1) 144
Tax Topics - Income Tax Act - Section 251.2 - Subsection 251.2(3) - Paragraph 251.2(3)(b) 112
Tax Topics - Income Tax Act - Section 252.2 - Subsection 252.2(2) 115
Tax Topics - Income Tax Act - Section 256 - Subsection 256(7) - Paragraph 256(7)(i) 176
Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) - Paragraph 70(6)(d.1) 161
Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) 1201
Tax Topics - Treaties - Income Tax Conventions - Article 29B 239
Tax Topics - Income Tax Act - Section 248 - (2)-(41) 157
Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) 199
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a.2) 59
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a.3) 38
Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(6) 174
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) 164
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) 163
Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) 91
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) 49
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.01) 66
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(19) 311
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) 125
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) 379

Paragraph 20(1)(b) - Cumulative eligible capital amount

Administrative Policy

16 November 89 T.I. (April 90 Access Letter, ¶1169)

The deduction in s. 20(1)(b) cannot be applied to income from property.