Words and Phrases - "kiln"

a
91
b
44
c
87
d
57
e
43
f
32
g
20
h
15
i
77
j
2
k
3
l
32
m
62
n
29
o
41
p
83
q
3
r
78
s
96
t
48
u
16
v
11
w
24
y
2

10 February 1999 Internal T.I. 9829297 F - SÉCHOIRS A BOIS - AMORTISSEMENT

Summary Under
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 8 - Paragraph 8(c)
buildings comprised of cells used to dry wood together with the heating equipment in another building constituted “kilns” used in processing

Buildings B and C, which only contained wood drying cells, were supplied with steam from Building A, which contained the heating and air blowing system. Regarding whether the cells qualified as “a building that is a kiln … acquired for the purpose of manufacturing or processing”, as described in Class 8(c), the Department stated:

Considering, on the one hand, that the wood is dried inside the Cells and, on the other hand, that the Cells are equipped with powerful fans to facilitate the drying of the wood and are insulated to retain the heat received at very high temperatures, we are of the view that the Cells meet the ordinary definition of the word "kiln" even though the heat is generated and controlled outside the Cells. Furthermore, since the Cells form a single property with Buildings B and C, we are of the view that the Cells, together with Buildings B and C, constitute buildings that are kilns for the purposes of paragraph (c) of Class 8 … .

Regarding the characterization of Building A and its heating equipment, it stated:

[I]f the capital property necessary for the production of steam is not used primarily to heat the Cells, it will fall within paragraph (i) of Class 8 of Schedule II of the Regulations and may fall under Class 43 of Schedule II of the Regulations if, among other things, they are used directly or indirectly by the taxpayer in Canada primarily for the manufacture or processing of goods for sale or lease. 1 However, if those capital properties are used primarily to supply the Cells, which appears to be the case, we are of the view that they should be considered part of the Cells and will be included in paragraph (c) of Class 8 of Schedule II of the Regulations. Furthermore, Building A could be included in Class 8 of Schedule II of the Regulations only if it forms a single property with the capital properties it houses; otherwise, it will be included in paragraph (q) of Class 1 of Schedule II of the Regulations. In our view, for Building A to form a single property with the furnace and boiler, the taxpayer must demonstrate that Building A has no other attributes than to house those capital properties.

Words and Phrases
kiln building