Income Tax Regulations

3900 (1) The following definitions apply in this section.

income

income of a taxpayer for a taxation year from mining operations in a province means the income, for the taxation year, that is derived from mining operations in the province as computed under the laws of the province that impose an eligible tax described in subsection (3). (revenu)

mine

mine includes any work or undertaking in which a mineral ore is extracted or produced and includes a quarry. (mine)

mineral ore

mineral ore includes an unprocessed mineral or mineral-bearing substance. (minerai)

mining operations

mining operations means

• (a) the extraction or production of mineral ore from or in a mine;

• (b) the transportation of mineral ore to the point of egress from the mine; and

• (c) the processing of

  • (i) mineral ore (other than iron ore) to the prime metal stage or its equivalent, and

  • (ii) iron ore to a stage that is not beyond the pellet stage or its equivalent. (exploitation minière)

non-Crown royalty

non-Crown royalty means a royalty contingent on production of a mine or computed by reference to the amount or value of production from mining operations in a province but does not include a royalty that is payable to the Crown in right of Canada or a province. (redevance non gouvernementale)

processing

processing includes all forms of beneficiation, smelting and refining. (transformation)

(2) For the purpose of paragraph 20(1)(v) of the Act, the amount allowed for a taxation year in respect of taxes on income from mining operations of a taxpayer is the total of all amounts each of which is

• (a) an eligible tax that is paid or payable by the taxpayer

  • (i) on the income of the taxpayer for the taxation year from mining operations, or

  • (ii) on a non-Crown royalty included in computing the income of the taxpayer for the taxation year;

• (b) an eligible tax that is paid by the taxpayer in the taxation year on either the income of the taxpayer for a previous taxation year from mining operations or a non-Crown royalty included in computing the income of the taxpayer for a previous taxation year, if

  • (i) the amount was deductible in computing the income of the taxpayer for the previous taxation year,

  • (ii) the amount has not been deducted in computing the income of the taxpayer for a taxation year that is prior to the taxation year, and

  • (iii) an assessment of the taxpayer to take into account a deduction in respect of the eligible tax under the Act for the previous taxation year would be precluded because of subsections 152(4) to (5) of the Act; or

• (c) interest in respect of eligible tax referred to in paragraph (a) or (b) that is paid in the taxation year by the taxpayer to the province imposing the eligible tax.

(3) An eligible tax referred to in subsection (2) is

• (a) a tax, on the income of a taxpayer for a taxation year from mining operations in a province, that is

  • (i) levied under a law of the province,

  • (ii) imposed only on persons engaged in mining operations in the province, and

  • (iii) paid or payable to

    • (A) the province,

    • (B) an agent of Her Majesty in right of the province, or

    • (C) a municipality in the province, in lieu of taxes on property or on any interest, or for civil law any right, in property (other than in lieu of taxes on residential property or on any interest, or for civil law any right, in residential property); and

• (b) a tax, on an amount received or receivable by a person as a non-Crown royalty, that is

  • (i) levied under a law of a province,

  • (ii) imposed specifically on persons who hold a non-crown royalty on mining operations in the province, and

  • (iii) paid or payable to the province or to an agent of Her Majesty in right of the province.