I-3 - Taxation Act

Section 1029.8.36.0.3.119 Disposition versions

2021-06-02

1029.8.36.0.3.119. Where, in respect of the employment of an individual with a qualified corporation or a qualified partnership as an eligible employee, a person or a partnership has obtained, is entitled to obtain or may reasonably expect to obtain a benefit or advantage, other than a benefit or advantage that may reasonably be attributed to the employment, whether in the form of a reimbursement, compensation or guarantee, in the form of proceeds of disposition of a property which exceed the fair market value of the property, or in any other form or manner, the following rules apply:

(a)  for the purpose of computing the amount that the qualified corporation is deemed to have paid to the Minister for a particular taxation year under section 1029.8.36.0.3.111, the qualified wages incurred by the corporation, in relation to the individual’s employment, in the particular year are to be determined by increasing the aggregate described in paragraph b of the definition of “qualified wages” in the first paragraph of section 1029.8.36.0.3.109 by the amount of the benefit or advantage that the person or partnership has obtained, is entitled to obtain or may reasonably expect to obtain on or before the corporation’s filing-due date for the particular year; and

(b)  for the purpose of computing the amount that is deemed to have been paid to the Minister for a taxation year under section 1029.8.36.0.3.112, by a corporation that is a member of the qualified partnership at the end of the partnership’s particular fiscal period ending in the year, the qualified wages incurred by the partnership, in relation to the individual’s employment, in the particular fiscal period are to be determined by increasing the aggregate described in paragraph b of the definition of “qualified wages” in the first paragraph of section 1029.8.36.0.3.109 by

i.  the amount of the benefit or advantage that a partnership or a person other than a person referred to in subparagraph ii has obtained, is entitled to obtain or may reasonably expect to obtain on or before the last day of the six-month period following the end of the particular fiscal period, or

ii.  the product obtained by multiplying the amount of the benefit or advantage that the corporation or a person with whom the corporation is not dealing at arm’s length has obtained, is entitled to obtain or may reasonably expect to obtain on or before the last day of the six-month period following the end of the particular fiscal period, by the reciprocal of the agreed proportion in respect of the corporation for that fiscal period.

Where the qualified corporation’s particular taxation year, or the qualified partnership’s particular fiscal period, includes all or part of the transitional period and where, in the transitional period or part of that period, the qualified corporation’s or qualified partnership’s wholly-owned subsidiary for the particular year or particular fiscal period carried out work on the qualified corporation’s or qualified partnership’s behalf in relation to recognized activities, the first paragraph applies in respect of a benefit or advantage obtained or to be obtained in relation to the work, but is to be read

(a)  as if “the employment of an individual with a qualified corporation or a qualified partnership as an eligible employee” and “to the employment” in the portion before subparagraph a were replaced by “the work carried out on behalf of a qualified corporation or a qualified partnership by the qualified corporation’s or qualified partnership’s wholly-owned subsidiary in relation to recognized activities” and “to the work”, respectively;

(b)  as if “the qualified wages incurred by the corporation, in relation to the individual’s employment, in the particular year are to be determined” and “paragraph b of the definition of “qualified wages” in the first paragraph” in subparagraph a were replaced by “ the corporation’s qualified expenditure for the particular year is to be determined” and “subparagraph b of the second paragraph”, respectively; and

(c)  as if “the qualified wages incurred by the partnership, in relation to the individual’s employment, in the particular fiscal period are to be determined” and “paragraph b of the definition of “qualified wages” in the first paragraph” in the portion of subparagraph b before subparagraph i were replaced by “the partnership’s qualified expenditure for the particular fiscal period is to be determined” and “subparagraph b of the second paragraph”, respectively.

2021, c. 14, s. 140.