Income Tax Application Rules (R.S.C., 1985, c. 2 (5th Supp.))

Marginal note:General depreciation provisions

• 18. (1) Where the capital cost to a taxpayer of any depreciable property that was acquired by the taxpayer before 1972 was required by any provision of the old law to be determined for the purpose of computing the amount of any deduction under any such provision in respect of that property, or would have been required by any provision of the old law to be determined for that purpose if any deduction under any such provision had been claimed by the taxpayer in respect of that property, the amount of the capital cost so required to be determined or that would have been so required to be determined, as the case may be, shall be deemed, for all purposes of the amended Act, to be the capital cost to the taxpayer of that property.

• Marginal note:Idem

  (2) Where a taxpayer acquired depreciable property before the beginning of the 1949 taxation year, for the purposes of section 13 of the amended Act and any regulations made under paragraph 20(1)(a) of that Act an amount equal to the total of

  • (a) all deductions allowed in computing the taxpayer’s income for the purpose of the Income War Tax Act as “special depreciation”, “extra depreciation” or allowances in lieu of depreciation for property the taxpayer had at the beginning of the 1949 taxation year (except deductions allowed under subparagraph 6(1)(n)(ii) of that Act), and

  • (b) ½ of all amounts allowed to the taxpayer under subparagraph 6(1)(n)(ii) of that Act for property that the taxpayer had at the beginning of the 1949 taxation year,

  shall be deemed to have been allowed to the taxpayer under regulations made under paragraph 20(1)(a) of the amended Act in computing income for a taxation year before the 1949 taxation year.

• Marginal note:Provisoes not applicable

  (3) The second and third provisoes to paragraph 6(1)(n) of the Income War Tax Act do not apply with respect to sales made after the beginning of the 1949 taxation year.

• Marginal note:Reference to depreciation

  (4) Reference in this section to depreciation shall be deemed to include a reference to allowances in respect of depreciable property of a taxpayer made under paragraph 5(1)(a) of the Income War Tax Act.

• Marginal note:Deduction deemed depreciation

  (5) An amount deducted under paragraph 5(1)(u) of the Income War Tax Act in respect of amounts of a capital nature shall, for the purpose of this section, be deemed to be depreciation taken into account in ascertaining the taxpayer’s income for the purpose of that Act or in ascertaining the taxpayer’s loss for the taxation year for which it was deducted.

Marginal note:Income maintenance payments

• 19. (1) Notwithstanding section 9, paragraph 6(1)(f) of the amended Act does not apply in respect of amounts received by a taxpayer in a taxation year that were payable to the taxpayer in respect of the loss, in consequence of an event occurring before 1974, of all or any part of the taxpayer’s income from an office or employment, under a plan, described in that paragraph, that was established before June 19, 1971.

• Marginal note:Effect of certain changes made in plan established before June 19, 1971

  (2) For the purposes of this section, a plan described in paragraph 6(1)(f) of the amended Act that was in existence before June 19, 1971 does not cease to be a plan established before that date solely because of changes made therein on or after that date for the purpose of ensuring that the plan qualifies as one entitling the employer of persons covered under the plan to a reduction, as provided for by subsection 50(2) of the Unemployment Insurance Act, in the amount of the employer’s premium payable under that Act in respect of insured persons covered under the plan.