I-3 - Taxation Act

Section 1049.2.2.1 Disposition versions

2017-12-07

1049.2.2.1. (Repealed).

1988, c. 4, s. 132; 1989, c. 5, s. 221; 1990, c. 7, s. 179; 1997, c. 3, s. 71; 2017, c. 29, s. 201.

2006-03-01

1049.2.2.1. Where a corporation issues, at a particular time, a share of its capital stock with the stipulation that it can be included in a stock savings plan or issues a share in replacement of a share issued at a particular time with such a stipulation or issued in replacement of a share issued in substitution for such a share and, after 16 December 1986, purchases or redeems in any manner whatsoever, directly or indirectly, in the year including the particular time but after that time or in the two years following that year, a share of a class of its capital stock other than a share described in section 965.11.12 or other than a share that has been the subject of a particular transaction referred to in section 965.11.19.1 in respect of which the corporation is not bound to meet the requirement prescribed in the second paragraph of section 965.11.11, it incurs a penalty equal to the amount determined under the second paragraph.

The amount of the penalty prescribed in the first paragraph in respect of a purchase or redemption is equal to the lesser of the following percentages:

(a)  25% of the amount obtained by multiplying the amount of the purchase or redemption by the proportion that the adjusted cost of the aggregate of the shares of the capital stock of the corporation issued, in the year of the purchase or redemption but before the purchase or redemption or in the two years preceding that year, with the stipulation that they could be included in a stock savings plan, and distributed in Québec and of the shares of the capital stock of the corporation issued in replacement of shares issued with such a stipulation, that were issued in the year of the purchase or redemption and before the time of such purchase or redemption or in the two years preceding that year and distributed in Québec or in replacement of shares issued in substitution for such shares, is of the paid-up capital at the time of the issue in respect of the aggregate of such shares of the corporation;

(b)  25% of the adjusted cost of the aggregate of

i.  the shares of the capital stock of the corporation that were issued, in the year of the purchase or redemption but before the purchase or redemption or in the two years preceding that year, with the stipulation that they could be included in a stock savings plan, and distributed in Québec to an individual other than a trust, to an investment group or to an investment fund;

ii.  the shares of the capital stock of the corporation issued in replacement of shares that are not contemplated in subparagraph i, that were issued, in the year of the purchase or redemption but before the purchase or redemption or in the two years preceding that year, with the stipulation that they could be included in a stock savings plan, and distributed in Québec to an individual other than a trust, to an investment group or to an investment fund; and

iii.  the shares of the capital stock of the corporation issued in replacement of shares, other than shares contemplated in subparagraph ii, issued in substitution for shares, other than shares contemplated in subparagraph i, that were issued, in the year of the purchase or redemption or in the two years preceding that year, with the stipulation that they could be included in a stock savings plan, and distributed in Québec to an individual other than a trust, to an investment group or to an investment fund.

1988, c. 4, s. 132; 1989, c. 5, s. 221; 1990, c. 7, s. 179; 1997, c. 3, s. 71.