Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.))

Marginal note:Definitions

• 19.01 (1) The definitions in this subsection apply in this section.

  “advertisement directed at the Canadian market”

  « annonce destinée au marché canadien »

  “advertisement directed at the Canadian market” has the same meaning as the expression “directed at the Canadian market” in section 2 of the Foreign Publishers Advertising Services Act and includes a reference to that expression made by or under that Act.

  “original editorial content”

  « contenu rédactionnel original »

  “original editorial content” in respect of an issue of a periodical means non-advertising content

  • (a) the author of which is a Canadian citizen or a permanent resident of Canada within the meaning assigned by the Immigration Act and, for this purpose, “author” includes a writer, a journalist, an illustrator and a photographer; or

  • (b) that is created for the Canadian market and has not been published in any other edition of that issue of the periodical published outside Canada.

  “periodical”

  « périodique »

  “periodical” has the meaning assigned by section 2 of the Foreign Publishers Advertising Services Act.

• Marginal note:Limitation re advertising expenses — periodicals

  (2) Subject to subsections (3) and (4), in computing income, no deduction shall be made by a taxpayer in respect of an otherwise deductible outlay or expense for advertising space in an issue of a periodical for an advertisement directed at the Canadian market.

• Marginal note:100% deduction

  (3) A taxpayer may deduct in computing income an outlay or expense of the taxpayer for advertising space in an issue of a periodical for an advertisement directed at the Canadian market if

  • (a) the original editorial content in the issue is 80% or more of the total non-advertising content in the issue; and

  • (b) the outlay or expense would, but for subsection (2), be deductible in computing the taxpayer’s income.

• Marginal note:50% deduction

  (4) A taxpayer may deduct in computing income 50% of an outlay or expense of the taxpayer for advertising space in an issue of a periodical for an advertisement directed at the Canadian market if

  • (a) the original editorial content in the issue is less than 80% of the total non-advertising content in the issue; and

  • (b) the outlay or expense would, but for subsection (2), be deductible in computing the taxpayer’s income.

• Marginal note:Application

  (5) For the purposes of subsections (3) and (4),

  • (a) the percentage that original editorial content is of total non-advertising content is the percentage that the total space occupied by original editorial content in the issue is of the total space occupied by non-advertising content in the issue; and

  • (b) the Minister may obtain the advice of the Department of Canadian Heritage for the purpose of

    • (i) determining the result obtained under paragraph (a), and

    • (ii) interpreting any expression defined in this section that is defined in the Foreign Publishers Advertising Services Act.

• Marginal note:Editions of issues

  (6) For the purposes of this section,

  • (a) where an issue of a periodical is published in several versions, each version is an edition of that issue; and

  • (b) where an issue of a periodical is published in only one version, that version is an edition of that issue.