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

Act current to 2015-06-09 and last amended on 2015-01-02. Previous Versions

Marginal note:Return

 Every corporation that is or would, but for subsection 181.1(4), be liable to pay tax under this Part for a taxation year shall file with the Minister, not later than the day on or before which the corporation is required by section 150 to file its return of income for the year under Part I, a return of capital for the year in prescribed form containing an estimate of the tax payable under this Part by it for the year.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. 1 (5th Supp.), s. 181.6;
  • 1994, c. 7, Sch. VIII, s. 108.
Marginal note:Provisions applicable to Part

 Sections 152, 158 and 159, subsection 161(11), sections 162 to 167 and Division J of Part I apply to this Part with such modifications as the circumstances require and, for the purpose of this section, paragraph 152(6)(a) shall be read as follows:

  • “(a) a deduction under section 181.1(4) in respect of any unused surtax credit (within the meaning assigned by subsection 181.1(6)) for a subsequent taxation year.”

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. 1 (5th Supp.), s. 181.7;
  • 1994, c. 7, Sch. II, s. 151, Sch. VIII, s. 109.
Marginal note:Provisions applicable — Crown corporations

 Section 27 applies to this Part with any modifications that the circumstances require.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 1998, c. 19, s. 199.

 [Repealed, 1994, c. 7, Sch. VIII, s. 109(1)]

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. 1 (5th Supp.), s. 181.8;
  • 1994, c. 7, Sch. VIII, s. 109.

 [Repealed, 1994, c. 7, Sch. VIII, s. 109(1)]

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. 1 (5th Supp.), s. 181.9;
  • 1994, c. 7, Sch. VIII, s. 109.

PART IITOBACCO MANUFACTURERS’ SURTAX

Marginal note:Surtax
  •  (1) Every corporation shall pay a tax under this Part for each taxation year equal to 50% of the corporation’s Part I tax on tobacco manufacturing profits for the year.

  • Marginal note:Definitions

    (2) In this Part,

    “exempt activity”

    « activité exclue »

    “exempt activity”, of a particular corporation, means

    • (a) farming; or

    • (b) processing leaf tobacco, if

      • (i) that processing is done by, and is the principal business of, the particular corporation,

      • (ii) the particular corporation does not manufacture any tobacco product, and

      • (iii) the particular corporation is not related to any other corporation that carries on tobacco manufacturing (determined, in respect of the other corporation, as if the particular corporation did not exist and the definition “tobacco manufacturing” were read without reference to the words “in Canada”);

    “Part I tax on tobacco manufacturing profits”

    « impôt de la partie I sur les bénéfices de fabrication du tabac »

    “Part I tax on tobacco manufacturing profits” of a corporation for a taxation year means 21% of the amount determined by the formula

    (A × B/C) - D

    where

    A 
    is the amount that would be the corporation’s Canadian manufacturing and processing profits for the year, within the meaning assigned by subsection 125.1(3), if the total of all amounts, each of which is the corporation’s loss for the year from an active business, other than tobacco manufacturing, carried on by it in Canada, were equal to the lesser of
    • (a) that total otherwise determined, and

    • (b) the total of all amounts, each of which is the amount of the corporation’s income for the year from an active business, other than tobacco manufacturing, carried on by it in Canada,

    B 
    is the corporation’s tobacco manufacturing capital and labour cost for the year,
    C 
    is the total of the corporation’s cost of manufacturing and processing capital for the year and its cost of manufacturing and processing labour for the year, within the meanings assigned by regulations made for the purposes of section 125.1, and
    D 
    is
    • (a) where the corporation is a Canadian-controlled private corporation throughout the year, the corporation’s business limit for the year as determined for the purpose of section 125, and

    • (b) in any other case, nil;

    “tobacco manufacturing”

    « fabrication du tabac »

    “tobacco manufacturing” means any activity, other than an exempt activity, relating to the manufacture or processing in Canada of tobacco or tobacco products in or into any form that is, or would after any further activity become, suitable for smoking;

    “tobacco manufacturing capital and labour cost”

    « coût en capital et en main-d’oeuvre lié à la fabrication du tabac »

    “tobacco manufacturing capital and labour cost” of a corporation for a taxation year means the total of the amounts that would be the corporation’s cost of manufacturing and processing capital for the year and its cost of manufacturing and processing labour for the year, within the meanings assigned by regulations made for the purpose of section 125.1, if the manufacturing or processing referred to in the definition “qualified activities” in those regulations were tobacco manufacturing.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 1994, c. 29, s. 16;
  • 1997, c. 26, s. 77;
  • 2000, c. 30, s. 173;
  • 2001, c. 16, s. 43;
  • 2007, c. 35, s. 54.