Regulation 1204

Subsection 1204(1)

Cases

3850625 Canada Inc. v. The Queen, 2010 DTC 1089 [at 2976], 2010 TCC 104, aff'd 2011 DTC 5062 [at 5714], 2011 FCA 117

Woods J. found that the taxpayer could include interest from its tax refund in the calculation of its gross resource profits, given that the...

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The Queen v. Gulf Canada Resources Ltd., 96 DTC 6065, [1996] 2 CTC 55 (FCA)

Although the taxpayer (which was a participant in the Syncrude oil sands project) went on to achieve partial success on other grounds, Pratte J.A....

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Gulf Canada Resources Ltd. v. The Queen, 95 DTC 5189, [1995] 1 CTC 334 (FCTD), partially rev'd 96 DTC 6065 (FCA).

Capital cost allowance claims and interest relating to the taxpayer's interest in the Syncrude project were not required to be deducted from its...

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Echo Bay Mines Ltd. v. The Queen, 92 DTC 6437, [1992] 2 CTC 182 (FCTD)

MacKay J. found that the taxpayer (which operated a silver mine in the Northwest Territories) entered into forward sales contracts as hedging...

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Words and Phrases
hedge

International Nickel Co. of Canada Ltd. v. MNR, 71 DTC 5332 (FCTD)

The taxpayer made continual outlays on scientific research carried out by its personnel in order to identify improvements to its methods for...

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See Also

ATCO Electric Ltd. v. The Queen, 2007 DTC 974, 2007 TCC 243

The Court rejected the position of the Crown that the furthest point at which sub-bituminous coal was not beyond its equivalent of the prime metal...

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Astral Energy Ltd. v. MNR, 90 DTC 1844, [1990] 2 CTC 2422 (TCC)

Bonner J. accepted the taxpayer's submission that the "source of income" referred to in s. 1204(1)(f) are the "oil and gas wells in Canada...

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Administrative Policy

29 November 2012 Internal T.I. 2012-0462361I7 - Meaning of "Prime Metal Stage or its Equivalent"

CRA defines "prime metal stage or its equivalent" in accordance with Canada Pacific Ltd v. Canada, 1994 F.C.J. 993 (FCA), followed in The Queen v....

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 65 145

26 January 1996 External T.I. 9603015 - RESOURCE PROFITS, DIAMONDS, PRIME METAL STAGE

"The equivalent of the prime metal stage for gem diamonds is the stage at which the rough diamonds have been separated from the gangue (other...

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27 July 1995 Internal T.I. 9514966 - CAPITAL TAX - RESOURCE PROFITS

Notwithstanding Mine Assessor v. Denison Mines Ltd., capital tax attributed to facilities and equipment used in production is considered as a...

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24 December 1992 Memorandum (Tax Window, No. 27, p. 14, ¶2337)

Unrealized gains and losses on gold loans designated by a gold producer as effective hedges of its gold production will be included in resource...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Computation of Profit 59

92 C.R. - Q.17

In light of the Echo Bay decision, hedging gains and losses for non-speculative forward sales contracts with respect to hedged amounts of...

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89 C.R. - Q.22

Any gain or loss realized by a mining company from the borrowing of gold (due to changes in the quantum of its liability) will not constitute...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing 42

89 C.P.T.J. - Q21

Because you cannot have income from the production of gas in advance of that production, proceeds which are include in income under s. 12(1)(a)...

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89 C.P.T.J. - Q22

The resource allowance base of a fully integrated oil and gas company is reduced by CCA claims for Class 13 leasehold improvements. The reduction...

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89 C.P.T.J. - Q23

List of items which are not deductible in computing the resource allowance base.

Paragraph 1204(1)(b)

See Also

Placer Dome Canada Ltd. v. Ontario (Minister of Finance), 2006 DTC 6532, 2006 SCC 20, [2006] 1 S.C.R. 715

The taxpayer sold its gold production to bullion dealers at the spot price but also, in order to manage the risk associated with fluctuations in...

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Words and Phrases
consideration
Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Interpretation Bulletins, etc. shifting CRA position could not be relied upon except to evidence ambiguity 79
Tax Topics - Statutory Interpretation - Redundancy/reading in words presumption against tautology 120
Tax Topics - Statutory Interpretation - Resolving Ambiguity residual presumption in favour of the taxpayer 133
Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Futures/Forwards/Hedges “hedging “ includes cash settled derivatives including options 461
Tax Topics - Statutory Interpretation - Regulations/Statutory Delegation addition of regulation did not significantly expand scope of tax 264

Subparagraph 1204(1)(b)(ii)

See Also

Barrick Gold Corporation v. The Queen, 2017 TCC 18

In 1998, the taxpayer was in the business of producing and processing gold in Canada from three mines, including the Doyon Mine in which it had a...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Accounting Principles character of hedging gain was a legal question not affected by accounting 119

Subparagraph 1204(1)(b)(iii)

Clause Subparagraph 1204(1)(b)(iii)(A)

Administrative Policy

24 May 2005 External T.I. 2005-0121291E5 F - Processing in Canada of ore

Mineco crushes nickel ore underground in its mine. Opco, which operates a bulk ore hauling business in Canada, uses a mobile crushing plant (the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 125.1 - Subsection 125.1(3) - Manufacturing or Processing - Paragraph (f) - Subparagraph (f)(i) second crushing of nickel ore at the surface is excluded processing 110
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 10 - Paragraph 10(k) mobile plant of subcontractor used at mine surface level to further crush ore before its transport qualified under 10(k) 106

Paragraph 1204(1)(f)

Administrative Policy

27 July 1995 Internal T.I. 9514966 - CAPITAL TAX - RESOURCE PROFITS

"Provincial capital tax paid should be allocated between resource and non-resource activity and capital tax attributed to resource activity is a...

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Subsection 1204(1.1)

Administrative Policy

20 January 2010 Internal T.I. 2009-0348571I7 - Interest Rate Swaps and Resource Profits

a Canadian resource corporation in the ordinary course of business had borrowed under long-term financings and entered into interest rate swaps...

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15 September 2000 External T.I. 2000-0027485 - Hedging Losses in Resource Profit Calculation

Losses realized by an oil and gas company on several hedging contracts were deductible in computing its resource profits given that they were...

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Articles

Richardson, "Cominco, Westar, and the Legacy of a Gulf", 1993 Canadian Tax Journal, Vol. 41, No. 4, p. 672.

Subsection 1204(3)

Cases

The Queen v. Gulf Canada Resources Ltd., 96 DTC 6065, [1996] 2 CTC 55 (FCA)

The extraction by the taxpayer of bitumen from oil sands, and the transformation by it of the bitumen into crude oil, gave rise to "income or loss...

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Paragraph 1204(3)(a)

See Also

Exxonmobil Canada Ltd. v. The Queen, 2019 TCC 108

Crude pumped from an undersea oil reservoir of the Hibernia joint venture up to the “Hibernia Platform” above the ocean surface was...

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Words and Phrases
derived
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Scientific Research & Experimental Development initial well placed in order to validate improved reservoir analysis was not SR&ED 326

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