Income Tax Regulations

8100 For the purpose of subsection 20(26) of the Act, an insurer’s unpaid claims reserve adjustment for its taxation year that includes February 23, 1994 is the amount, if any, by which

• (a) the total of all amounts each of which is the maximum amount that, because of paragraph 1400(e), was deductible under paragraph 20(7)(c) of the Act in respect of an insurance policy in computing the insurer’s income for its last taxation year that ended before February 23, 1994

exceeds

• (b) where the insurer elects, by notifying the Minister in writing, to have this paragraph apply, the total of all amounts each of which is the maximum amount that would, because of paragraph 1400(e), have been deductible under paragraph 20(7)(c) of the Act in respect of an insurance policy in computing the insurer’s income for its last taxation year that ended before February 23, 1994 if the amount “1/3” in the formula in subparagraph 1400(e)(ii), as it read for that year, were replaced by the amount “1”, and

• (c) in any other case, the total of all amounts each of which is the maximum amount that would, because of paragraph 1400(e) or (e.1), have been deductible under paragraph 20(7)(c) of the Act in respect of an insurance policy in computing the insurer’s income for its last taxation year that ended before February 23, 1994 if paragraph 1400(e.1) had applied to that year and paragraphs 1400(e) and (e.1) were read in their application to that year as they read in their application to the insurer’s taxation year that includes February 23, 1994.