I-3 - Taxation Act

Section 726.9.3 Disposition versions

2006-03-01

726.9.3. Section 726.9.2 applies to a property or to a business of an elector only if

(a)  where the elector is an individual, other than a trust,

i.  its application to all of the properties in respect of which elections were made under that section by the elector or a spouse of the elector and to all the businesses in respect of which elections were made under that section by the elector

(1)  would result in an increase in the amount deductible under section 726.8 in computing the taxable income of the elector or a spouse of the elector, and

(2)  in respect of each of the taxation years 1994 and 1995, where no part of the taxable capital gain resulting from an election by the elector is included in computing the income of a spouse of the elector, would not result in the amount determined under paragraph a of section 726.8 for the year in respect of the elector being exceeded by the lesser of the amounts determined under paragraphs b and c of section 726.8 for the year in respect of the elector, and where no part of the taxable capital gain resulting from an election by the elector is included in computing the income of the elector, would not result in the amount determined under paragraph a of section 726.8 for the year in respect of a spouse of the elector being exceeded by the lesser of the amounts determined under paragraphs b and c of section 726.8 for the year in respect of the spouse,

ii.  the amount designated in the election in respect of the property exceeds 11/10 of its fair market value at the end of 22 February 1994, or

iii.  the amount designated in the election in respect of the business is $1.00 or exceeds 11/10 of the fair market value at the end of 22 February 1994 of all the incorporeal capital property owned at that time by the elector in respect of the business; and

(b)  where the elector is a personal trust, its application to all of the properties in respect of which an election was made under that section 726.9.2 by the elector would result in

i.  an increase in the amount deemed by section 668.1 to be a taxable capital gain of an individual, other than a trust, who was a beneficiary under the trust at the end of 22 February 1994 and resident in Canada at any time in the individual’s taxation year in which the trust’s taxation year that includes that day ends, or

ii.  where section 726.19 applies to the trust for the trust’s taxation year that includes 22 February 1994, an increase in the amount deductible under that section in computing the trust’s taxable income for that year.

1996, c. 39, s. 186; 2005, c. 1, s. 140.