I-3 - Taxation Act

Section 485.15 Disposition versions

2019-06-19

485.15. Where a commercial debt obligation issued by a partnership, in this section referred to as the “partnership obligation”, is settled at any time in a fiscal period of the partnership that ends in a taxation year of a member of the partnership,

(a)  the member may deduct, in computing the member’s income for the year, such amount as the member claims not exceeding the relevant limit in respect of the partnership obligation;

(b)  for the purposes of paragraph a, the relevant limit in respect of the partnership obligation is the amount that would be included in computing the member’s income for the year as a consequence of the application of sections 485.13 and 599 to 613.10 to the settlement of the partnership obligation if the partnership had designated amounts under sections 485.6 and 485.8 to 485.10 to the maximum extent permitted in respect of each obligation settled in that fiscal period and if income arising from the application of section 485.13 were from a source of income separate from any other sources of partnership income; and

(c)  for the purposes of sections 485 to 485.18 and 485.42 to 485.52,

i.  the member is deemed to have issued a commercial debt obligation that was settled at the end of that fiscal period,

ii.  the amount deducted under paragraph a in respect of the partnership obligation in computing the member’s income shall be treated as if it were the forgiven amount at the end of that fiscal period in respect of the obligation referred to in subparagraph i,

iii.  subject to subparagraph iv, the obligation referred to in subparagraph i is deemed to have been issued at the same time at which, and in the same circumstances in which, the partnership obligation was issued,

iv.  where the member is a taxpayer that was subject to a loss restriction event at a particular time that is before the end of that fiscal period and before the taxpayer became a member of the partnership, and the partnership obligation was issued before the particular time,

(1)  subject to the application of this subparagraph iv to the taxpayer after the particular time and before the end of that fiscal period, the obligation referred to in subparagraph i is deemed to have been issued by the member after the particular time, and

(2)  paragraph b of the definition of “unrecognized loss” in section 485 and paragraph b of sections 485.1 and 485.2 do not apply in respect of the loss restriction event, and

v.  the source in connection with which the obligation referred to in subparagraph i was issued is deemed to be the source in connection with which the partnership obligation is issued.

1996, c. 39, s. 142; 1997, c. 3, s. 71; 2017, c. 1, s. 122; 2019, c. 14, s. 143.

2017-02-08

485.15. Where a commercial debt obligation issued by a partnership, in this section referred to as the “partnership obligation”, is settled at any time in a fiscal period of the partnership that ends in a taxation year of a member of the partnership,

(a)  the member may deduct, in computing the member’s income for the year, such amount as the member claims not exceeding the relevant limit in respect of the partnership obligation;

(b)  for the purposes of paragraph a, the relevant limit in respect of the partnership obligation is the amount that would be included in computing the member’s income for the year as a consequence of the application of sections 485.13 and 599 to 613.10 to the settlement of the partnership obligation if the partnership had designated amounts under sections 485.6 to 485.10 to the maximum extent permitted in respect of each obligation settled in that fiscal period and if income arising from the application of section 485.13 were from a source of income separate from any other sources of partnership income; and

(c)  for the purposes of sections 485 to 485.18 and 485.42 to 485.52,

i.  the member is deemed to have issued a commercial debt obligation that was settled at the end of that fiscal period,

ii.  the amount deducted under paragraph a in respect of the partnership obligation in computing the member’s income shall be treated as if it were the forgiven amount at the end of that fiscal period in respect of the obligation referred to in subparagraph i,

iii.  subject to subparagraph iv, the obligation referred to in subparagraph i is deemed to have been issued at the same time at which, and in the same circumstances in which, the partnership obligation was issued,

iv.  where the member is a taxpayer that was subject to a loss restriction event at a particular time that is before the end of that fiscal period and before the taxpayer became a member of the partnership, and the partnership obligation was issued before the particular time,

(1)  subject to the application of this subparagraph iv to the taxpayer after the particular time and before the end of that fiscal period, the obligation referred to in subparagraph i is deemed to have been issued by the member after the particular time, and

(2)  paragraph b of the definition of “unrecognized loss” in section 485 and paragraph b of sections 485.1 and 485.2 do not apply in respect of the loss restriction event, and

v.  the source in connection with which the obligation referred to in subparagraph i was issued is deemed to be the source in connection with which the partnership obligation is issued.

1996, c. 39, s. 142; 1997, c. 3, s. 71; 2017, c. 1, s. 122.

2006-03-01

485.15. Where a commercial debt obligation issued by a partnership, in this section referred to as the “partnership obligation”, is settled at any time in a fiscal period of the partnership that ends in a taxation year of a member of the partnership,

(a)  the member may deduct, in computing the member’s income for the year, such amount as the member claims not exceeding the relevant limit in respect of the partnership obligation;

(b)  for the purposes of paragraph a, the relevant limit in respect of the partnership obligation is the amount that would be included in computing the member’s income for the year as a consequence of the application of sections 485.13 and 599 to 613.10 to the settlement of the partnership obligation if the partnership had designated amounts under sections 485.6 to 485.10 to the maximum extent permitted in respect of each obligation settled in that fiscal period and if income arising from the application of section 485.13 were from a source of income separate from any other sources of partnership income; and

(c)  for the purposes of sections 485 to 485.18 and 485.42 to 485.52,

i.  the member is deemed to have issued a commercial debt obligation that was settled at the end of that fiscal period,

ii.  the amount deducted under paragraph a in respect of the partnership obligation in computing the member’s income shall be treated as if it were the forgiven amount at the end of that fiscal period in respect of the obligation referred to in subparagraph i,

iii.  subject to subparagraph iv, the obligation referred to in subparagraph i is deemed to have been issued at the same time at which, and in the same circumstances in which, the partnership obligation was issued,

iv.  where the member is a corporation the control of which was acquired at a particular time that is before the end of that fiscal period and before the corporation became a member of the partnership and the partnership obligation was issued before the particular time,

(1)  subject to the application of this subparagraph iv to an acquisition of control of the corporation after the particular time and before the end of that fiscal period, the obligation referred to in subparagraph i is deemed to have been issued by the member after the particular time, and

(2)  paragraph b of the definition of “unrecognized loss” in section 485 and paragraph b of sections 485.1 and 485.2 do not apply in respect of that acquisition of control, and

v.  the source in connection with which the obligation referred to in subparagraph i was issued is deemed to be the source in connection with which the partnership obligation is issued.

1996, c. 39, s. 142; 1997, c. 3, s. 71.