I-3 - Taxation Act

Section 965.31.2 Disposition versions

2006-03-01

965.31.2. The financial commitment of a shareholder of a Québec business investment company, at a particular time, is equal to the amount by which the aggregate of amounts representing the total of his interest in and additional interest in respect of a qualified investment made by the Québec business investment company before that time and held by it at that time is exceeded by the aggregate of

(a)  the lesser of the paid-up capital represented by the shares of the capital stock of the Québec business investment company held by the shareholder at that time as the actual owner thereof and the cost to the shareholder of those shares determined without taking into account the borrowing costs or other costs related to the acquisition thereof or of the custody fees;

(b)  the amount of the loans and advances that are due to the shareholder, at that time, by the Québec business investment company; and

(c)  the percentage of the surpluses of the Québec business investment company, other than a property revaluation surplus, as shown in its financial statements submitted to the shareholders or, where such financial statements have not been prepared, or have not been prepared in accordance with generally accepted accounting principles, that would be shown if such financial statements had been prepared in accordance with generally accepted accounting principles, for its last taxation year ended before that time and adjusted to take into account any gain or loss realized, from the end of the said taxation year until the particular time, as a result of the disposition by the Québec business investment company of a qualified investment, equal to the percentage of the interest in the surpluses, taking into account the rights of the other shareholders, of the shares held by the shareholder at that time as the actual owner thereof.

Notwithstanding the foregoing, in no case may the aggregate of the amount determined under subparagraphs a to c of the first paragraph be less than the cost to the shareholder of the shares of the capital stock of the Québec business investment company held by him at that time as the actual owner thereof without taking into account the borrowing costs or other costs related to the acquisition thereof or of the custody fees.

1987, c. 21, s. 64; 1992, c. 1, s. 141; 1995, c. 63, s. 107.