Bill 45 (Legislature 21, Session 1)

L21 S1 3231

Alberta — Bills

1986 BILL 45 First Session, 21st Legislature, 35 Elizabeth II THE LEGISLATIVE ASSEMBLY OF ALBERTA BILL 45 ALBERTA CORPORATE INCOME TAX AMENDMENT ACT, 1986 THE PROVINCIAL TREASURER First Reading Second Reading Committee of the Whole Third Reading Royal Assent

Bill 45 BILL 45 1986 ALBERTA CORPORATE INCOME TAX AMENDMENT ACT, 1986 (Assented to , 1986) HER MAJESTY, by and with the advice and consent of the Legislative Assembly of Alberta, enacts as foUows: 1 The Alberta Corporate Income Tax Act is amended by this Act. 2(1)

Section 2 is amended (

a) in subsection (6) by adding "or designations" before "are not apphcable"; (

b) by adding the following after

section 2(9): (10) Subsection 248(7) of the federal Act does not apply for the purposes of this Act.

(2) Subsection (l)(

a) applies to 1985 and subsequent taxation years.

(3) Subsection (l)(

b) applies after 1984. 3(1)

Section 8 is amended (

a) in subsection (1) by adding "(1.1)," after "subsections"; (

b) by adding the following after subsection (1):

(1.1) In the apphcation of subdivision b of Division B of

Part I of the federal Act, a reference to amounts deducted under subsection 127(5) of the federal Act includes the amounts deemed to have been deducted imder that subsection by sub

section 127.1(3) or 192(10) of the federal Act.

(2) Subsection (

I) applies to 1982 and subsequent taxation years. 4(1)

Section 9 is amended (

a) by renumbering U as

section 9(1); (

b) in subsection (1) by striking out "Subdivision" arui substitut ing "Subject to subsection (2), subdivision"; (

c) by adding the following after subsection (I):

(2) In the apphcation of subdivision c of Division B of

Part I of the federal Act, a reference to amounts deducted under subsection 127(5) of the federal Act includes the amounts

Explanatory Notes 1 This Bill will amend

chapter A-17 of the Revised Statutes of Alberta 1980. 2 Subsection 248(7) of the federal Act reads as follows:

(7) For the purposes of this Act, anything sent by mad shad be deemed to have been received by the recipient on the day that it was mailed. 3

Section 8(1) presently reads: 8(1) Subject to subsections (2), (2.1) and (3), subdivision b of Division B of

Part I of the federal Act applies in determining the income or loss of a corporation from a business or property for a taxation year.

Section 9 presently reads: 9 Subdivisign c of Division B of

Part I of the federal Act applies to deter mine the taxable capital gains and allowable capital losses of a corporation from the disposition of any property. Explanatory Notes

deemed to have been deducted under that subsection by sub

section 127.1(3) or 192(10) of the federal Act. (2) Subsection (1) applies to 1982 and subsequent taxation years. 5(1)

Section 18 is amended (

a) in subsection (1) by adding "plus any amount added under subsection (1.1) and" after "Act"; (

b) by adding the following after subsection (1):

(1.1) There may be added to a corporation's taxable income otherwise determined for a taxation year any amount up to the amount added by the corporation under

section 110.5 of the federal Act to the extent that the addition does not in crease an amount deductible by the corporation under

section 22 or 22.1 for the year. (

c) in subsection (3) by striking out "and" at the end of clause (

a) and adding the following after clause (a): (a.

l) clause 11 l(8)(a)(ii)(

B) shall be read as if "or claimed by him under paragraph 186(l)(

c) or (d)" were struck out, (a.2) to determine the non-capital loss of a corporation for a taxation year, the reference to

section 110.5 in subparagraph 11 l(8)(b)(ii) shall be read as a reference to

section 18(1.1) of this Act, and (2) Subsection (1) applies to 1985 and subsequent taxation years. 6(1)

Section 20 is amended (

a) in subsection (5) (

i) by striking out "Where" and substituting "Except with re spect to an amalgamation or winding-up to which subsection (6.1) or (6.2) applies, if"; (ii) by striking out "another corporation" and substituting "another person"; (iii) by striking out "used by it" and substituting "used by him"; (iv) in clause (

a) by striking out "in respect of its taxation year" and substituting "or under

section 11(6) or (7) of the Alberta Income Tax Act in respect of his taxation year"; (

v) in clause (

b) by striking out "or 66.4" and substituting ", 66.4 or 66.5"; (vi) by striking out "predecessor corporation in determining its royalty" and substituting "predecessor in determining his royalty"; (vii) by striking out "subsequent to its" and substituting "sub sequent to his"; (viii) by striking out "predecessor corporation" wherever it occurs and substituting "predecessor";

Section 18 presently reads: 18(1) Taxable income for the taxation year shad be income as determined under

Part 2 of this Act less any deductions allowed by subsection (2).

(2) Subject to subsection (3), sections 110, 111. 112 and 113 of the federal Act apply in the calculation of taxable income for the purposes of this Act.

(3) In the application of

section HI of the federal Act (

a) subparagraph lll(3)(a)(ii) does not apply, and (

b) with respect to the computation of taxable income for taxation years of a corporation to which this Act applies, no deduction shad be allowed for a corporation's non-capital losses, net capital losses, re stricted farm losses or farm losses determined under this Act for the 1983 or subsequent taxation years to the extent that those losses have been deducted in computing taxable income for taxation years of the corporation to which the old Act applies. 6

Section 20(5) and (6) presently read:

(5) Where a corporation (in this subsection referred to as the "successor corporation") has, at any time after May 6, 1974, acquired, by purchase or otherwise, including an acquisition as a result of an amalgamation of 2 or more corporations, from another corporation, (in this subsection re ferred to as the "predecessor corporation") ad or substantially ad of the property of the predecessor corporation used by it in carrying on in Canada any of the businesses mentioned in subparagraphs 66(15)(h)(

i) to (vii) of the federal Act the successor corporation shall, in determining its royalty tax deduction for a taxation year be entitled to include in the calculation of its attributed Canadian royalty income for the year the lesser of (

a) the amount that, but for this subsection, the predecessor corpora tion would have been entitled to carryforward under subsection (4) in respect of its taxation year in which the property so acquired was acquired by the successor corporation, to the extent that such amount has not been included in the attributed Canadian royalty income of the successor corporation for a previous taxation year, and (

b) an amount equal to such part of its income for the year if no deduction were allowed under

section 65, 66, 66.1, 66.2 or 66.4 of the federal Act as may reasonably be regarded as attributable to the pro duction of petroleum, natural gas or coal from the property so acquired from the predecessor corporation, and in respect of any such attributed Canadian royalty income included in the amount referred to in clause (a), no amount may be used by the predecessor corporation in determining its royalty tax deduction for a tax ation year subsequent to its taxation year in which the property so acquired was acquired by the successor corporation. Explanatory Notes

(

b) in subsection (6) (

i) by striking out "Where" and substituting "Except with re spect to an amalgamation or winding-up to which subsection (6.1) or (6.2) applies, if"; (ii) in clause (

b) by striking out "or 66.4" and substituting ", 66.4 or 66.5"; (

c) by adding the following after subsection (6):

(6.1) If there has been an amalgamation of corporations de scribed in paragraph 87(1. l)(

a) or (

b) of the federal Act, the new corporation shall, for the purposes of this section, be deemed to be the same corporation as and a continuation of each predecessor corporation, except that this subsection shall in no respect affect the determination of any predecessor cor poration's fiscal period, taxable income or tax payable.

(6.2) For the purposes of this section, if the rules in subsec tion 88(1) of the federal Act apphed to the winding-up of a subsidiary, its parent shall be deemed to be the same corpo ration as and a continuation of the subsidiary.

(2) Subsection (l)(a)(i), (b)(

i) and (

c) apply with respect to amalgam ations occurring and windings-up commencing after 1982.

(3) Subsection (l)(a)(

v) and (b)(ii) apply to 1985 and subsequent tax ation years.

(4) Subsection (l)(a)(ii) to (iv) and (vi) to (viii) apply with respect to acquisitions of property by a successor corporation from a predecessor after Aprd 19, 1983. 7(1)

Section 22.1(l)(

h) is amended by repealing subclauses (vi) and (vii) and substituting the following: (vi) processing ore, other than iron ore or tar sands, from a min eral resource to any stage that is not beyond the prime metal stage or its equivalent, (vii) processing iron ore from a mineral resource to any stage that is not beyond the pellet stage or its equivalent, (vii.

l) processing tar sands to any stage that is not beyond the crude oil stage or its equivalent, (2) Subsection (1) applies to 1985 and subsequent taxation years.

(6) Where a corporation (in this subsection referred to as the "second successor corporation") has, at any time after May 6, 1974, acquired, by purchase or otherwise, including an acquisition as a result of an amalgam ation of 2 or more corporations, from another corporation (in this subsec tion referred to as the "first successor corporation") that was a successor corporation within the meaning of subsection (5), ad or substantially ad of the property of the first successor corporation used by it in Canada in carrying on any of the businesses mentioned in subparagraphs 66(15)(h)(

i) to (vii) of the federal Act, the second successor corporation shall, in deter mining its royalty tax deduction for a taxation year be entitled to include in the calculation of its attributed Canadian royalty income for the year the lesser of (

a) the amount determined under subsection (5)(

a) in respect of the first successor corporation to the extent that the amount has not been included in the attributed Canadian royalty income of the first succes sor corporation for its previous taxation year in which the property so acquired was acquired by the second successor corporation and has not been included in the attributed Canadian royalty income of the second successor corporation for a taxation year, and (

b) an amount equal to such part of its income for the year if no deduction were allowed under

section 65, 66, 66.1, 66.2 or 66.4 of the federal Act as may reasonably be regarded as attributable to the pro duction of petroleum, natural gas or coal from the property acquired from the first successor corporation's predecessor corporation within the meaning of subsection (5), and in respect of any such attributed Canadian royalty income included in the amount referred to in clause (a), no amount may be used by the first successor corporation in determining its royalty tax deduction for a taxation year subsequent to its taxation year in which the property so acquired was acquired by the second successor corporation. 7

Section 22.1(l)(

h) presently reads: 22.1(1) In this section, except as otherwise provided in subsections (8) and (9). (h) "manufacturing or processing" does not include (

i) farming or fishing, (ii) logging, (iii) construction, (iv) operating an oil or gas wed or processing heavy crude od recovered from a natural reservoir in Canada to a stage that is not beyond the crude od stage or its equivalent, (

v) extracting minerals from a mineral resource, (vi) processing, to the prime metal stage or its equivalent, ore (other than iron ore) from a mineral resource, (vii) processing, to the pellet stage or its equivalent, iron ore from a mineral resource, (viii) producing industrial minerals other than sulphur produced by processing natural gas, (ix) producing or processing electrical energy or steam, for sale, (

x) processing gas, if such gas is processed as part of the business of selling or distributing gas in the course of operating a public utility, or Explanatory Notes

8(1)

Section 25 is amended (

a) by repealing subsection (l)(c)(ii) and substituting the following: (ii) a certificate of completion has been issued to the corpo ration by the Minister of Housing or the Minister of Munic ipal Affairs, as the case may be, before July 1, 1987, and (

b) in subsection (4) by striking out "Alberta Mortgage and Hous ing Corporation" wherever it occurs and substituting "Minister of Housing or the Minister of Municipal Affeirs, as the case may be,"; (

c) in subsection (4.1) by striking out "1985" and substituting "1990"; (

d) in subsection (5) by striking out "Alberta Mortg^e and Hous ing Corporation" and substituting "person who issued it". (2) Subsection (1) applies after June 30, 1985.

(xi) any manufacturing or processing of goods for sale or lease, if, for any taxation year of a corporation in respect of which the expression is being applied, less than 10% of its gross revenue from ad active businesses carried on in Canada was from (

A) the selling or leasing of goods manufactured or processed in Canada by it, and (

B) the manufacturing or processing in Canada of goods for sale or lease, other than goods for sale or lease by it; 8

Section 25(1 )(c), (4), (4.1) and (5) presently read: 25(1) In this section, (c) "qualifying Alberta multiple unit residential budding" means a property that is a multiple unit residential building in Alberta that is or would, but for the operation of Class 31 or 32 of

Schedule II of the federal regulations, be included in Class 3 or 6 of

Schedule II of the federal regulations and in respect of which (

i) a certificate of eligibility has been issued by the Alberta Mort gage and Housing Corporation certifying that the installation of footings or any other base support of the building was commenced after December 31, 1979 and before January 1, 1982, and that, according to plans arui specifications for the building, not less than 80% of the floor space wdl be used in providing self-contained domestic establishments and related parking, recreation, service and storage areas, (ii) a certificate of completion has been issued by the Alberta Mortgage and Housing Corporation to the corporation, arui (iii) immediately after the certificate of completion has been is sued, not more than 20% of the floor space is used for any pur poses other than those referred to in subclause (

i) but does not include property (iv) the cost of which is deductible in computing the corporation's income, (

v) that is described in the corporation's inventory, or (vi) that was not acquired by the corporation for the purpose of gaining or producing income; (d) "residential unit" means a self-contained domestic establishment referred to in clause (c)(

i) but does not include a property described in clause (c)(iv), (

v) or (vi).

(4) A corporation is not entitled to an Alberta rental investment tax credit in respect of a taxation year unless a certificate of completion issued by the Alberta Mortgage and Housing Corporation arui, where the qualifying Alberta multiple unit residential building is owned in partnership or is owned by more than one person, a copy of the ownership agreement issued by the Alberta Mortgage and Housing Corporation accompany an appli cation made under this section.

(4.1) No application may be made under this

section after June 30, 1985.

(5) A certificate issued under subsection (I)(c)(

i) or (ii) may be revoked by the Alberta Mortgage and Housing Corporation if (

a) an incorrect statement was made in the furnishing of information, or (

b) the corporation does not comply with subsection (l)(

c) and a certificate that has been revoked shad be deemed to have been void from the time of its issue. 4 Explanatory Notes

9(1)

Section 26 is amended (

a) by repealing subsection (l)(

f) and substituting the following; (f) "restricted corporation" means a corporation described in subsection (1.12); (g) "restricted partnership" means a partnership described in subsection (1.13); (h) "restricted resource property" means (

i) any right or interest of any nature whatsoever or how soever described or part thereof in any production from a petroleum or natural gas well in Alberta with a finished drilling date on or before August 24, 1982 where the right or interest or part thereof was owned by an above-limit corporation or an above-limit partnership on August 24, 1982, and includes a right or interest or part thereof ac quired by an above-limit corporation or an above-hmit partnership after August 24, 1982 pursuant to the terms of a contract, other than an option, entered into and en forceable on or before that date, but does not include any right or interest or part thereof that is disposed of by an above-limit corporation or by an above-limit partnership after August 24, 1982 pursuant to the terms of a contract, other than an option, entered into and enforceable on or before that date, (ii) if subclause (

i) does not apply, any right or interest of any nature whatsoever or howsoever described or part thereof in any production from a petroleum or natural gas weU in Alberta that was disposed of after its finished drill ing date and after April 7, 1986 by a restricted corpora tion, or (iii) if subclause (

i) does not apply, any right or interest of any nature whatsoever or howsoever described or part thereof in any production from a petroleum or natural gas well in Alberta that was disposed of after its finished drill ing date and after April 7, 1986 by a restricted partner ship. (

b) by repealing subsection (I.

I) and substituting the following:

(1.1) A corporation shall not include in computing its Alberta crown royalty for a taxation year (

a) any of the amounts described in subsection (l)(c)(

i) to (iii) where those amounts are or are in respect of royalties receivable by or payable to the Crown in right of Alberta, (

i) after August 31, 1982 in respect of a restricted re source property described in subsection (l)(h)(i), un less the corporation is an exempt corporation, or (ii) after March 31, 1986 in respect of a restricted re source property described in subsection (l)(h)(ii).

Section 26 presently reads in part: 26(1) In this Division, (f) "restricted resource property" means any right or interest of any nature whatsoever or howsoever described or part thereof in any pro duction from a petroleum or natural gas wed in Alberta with a finished drilling date on or before August 24, 1982 where the right or interest or part thereof was owned by an above-limit corporation or an above- limit partnership on August 24, 1982, and includes a right or interest or part thereof acquired by an above-limit corporation or an above- limit partnership after August 24, 1982 pursuant to the terms of a contract, other than an option, entered into and enforceable on or before that date, but does not include any right or interest or part thereof that is disposed of by an above-limit corporation or by an above-limit partnership after August 24, 1982 pursuant to the terms of a contract, other than an option, entered into and enforceable on or before that date.

(1.1) A corporation, other than an exempt corporation, shad not include in computing its Alberta crown royalty for a taxation year any of the amounts described in subsection (l)(c)(

i) to (iii) where those amounts are or are in respect of royalties receivable by or payable to the Crown in right of Alberta after August 31, 1982 in respect of a restricted resource property.

(1.2) For the purposes of subsection (l)(f), a right or interest or part thereof shall he deemed not to be owned by a partnership unless there was in existence on August 24, 1982 a written agreement of partnership together with any other evidence that, in the opinion of the Provincial Treasurer is sufficient to establish that the right or interest or part thereof was intended by each of the members of the partnership to be owned by the partnership and not by the members.

(1.5) Notwithstanding subsections (l)(e), (1.7) and (1.8), when at any time after August 24, 1982, control of an exempt corporation is acquired by a person or group of persons that did not control the corporation at the time when it first became an exempt corporation, the Provincial Treasurer may deem that corporation not to be an exempt corporation for the taxation year in which control was acquired and ad subsequent taxation years if, in his opinion, the result of the acquisition of control of the particular exempt corporation is to increase the amount of royalty tax credit that would otherwise be determined under this Act.

(1.6) For the purposes of subsections (l)(a)(ii),(1.7)(

b) and (1.8), one cor poration is associated with another corporation at a particular time if by reference to that particular time the corporation would have been associ ated with the other corporation in its taxation year in which the particular time falls pursuant to subsection (2).

(2) Subject to subsections (3) and (6), if 2 or more corporations are asso ciated or deemed to be associated with each other under this Act, only those associated corporations that have Alberta crown royalty in the tax ation year during which they are associated ending in the same calendar year are the corporations that are associated with each other for the pur poses of this Division.

(3) In this Division, if a corporation (referred to in this subsection as the "taxpayer corporation') was, throughout the year (

a) resident in Canada, and (

b) not controlled directly or indirectly in any manner by 1 or more persons who are not resident in Canada, and it and another corporation are associated with each other for a taxa tion year and that other corporation was, throughout the year Explanatory Notes

or (

b) the restricted percentage of any of the amounts de scribed in subsection (l)(c)(

i) to (iii) where those amounts are or are in respect of royalties receivable by or payable to the Crown in right of Alberta after March 31, 1986 in respect of a restricted resource property described in sub

section (l)(h)(iii).

(1.11) If the restricted resource property is disposed of by only 1 restricted partnership, the restricted percentage of the amounts referted to in subsection (l.l)(

b) is the greater of (

a) the aggregate of all percentages, each of which repre sents the participation in the profits of the restricted part nership of a restricted corporation that was a partner in the restricted partnership during the last fiscal period of the restricted partnership that ends prior to the date of the disposition of the restricted resource property by the restricted partnership, and (

b) the aggregate of all percentages, each of which repre sents the participation in the profits of the restricted part nership of a restricted corporation that was a partner in the restricted partnership (

i) during the fiscal period of the restricted partner ship in which the date of the disposition of the re stricted resource property by the restricted partner ship occurred, and (ii) on or before the date of the disposition of the restricted resource property.

(1.111) If the restricted resource property is disposed of by more than 1 restricted partnership, the restricted percentage of the amounts referred to in subsection (l.l)(

b) is the largest of the restricted percentages determined under subsection (1.11) for each of the restricted partnerships.

(1.12) A corporation is a restricted corporation at any partic ular time if, during its last taxation year ending before that time, (

a) it has Alberta crown royalty in excess of $4 000 000, or (

b) it is associated with 1 or more corporations and the sum of (

i) the Alberta crown royalty of the corporation for that taxation year, and (ii) the aggregate of all amounts, each of which is the Alberta crown royalty of an associated corporation for its taxation year that ends in that taxation year of the corporation is in excess of $4 000 000.

(

c) a Canadian-controlled public corporation, other than a corpora tion that controlled the taxpayer corporation, or (

d) controlled by a Canadian-controlled public corporation that is a corporation other than the taxpayer corporation or a corporation that controlled the taxpayer corporation, the taxpayer corporation and the other corporation are deemed not to be associated with each other for the year.

(3.1) In its application to the first taxation year in which the taxpayer corporation and that other corporation, within the meaning of subsection (3), become associated, subsection (3) shall be read as if "other corporation was, throughout the year" was struck out and "other corporation was, throughout the period in the year that commences on the day the associ ation arose" was substituted. Explanatory Notes

(1.13) A partnership is a restricted partnership at any partic ular time if, at any time during the period commencing 365 days prior to the particular time, 1 or more restricted corpo rations are partners in the partnership.

(1.14) For the purposes of subsection (1.12), the Alberta crown royalty of a corporation for a taxation year is an amount equal to the product of (

a) the Alberta crown royalty of the corporation for the taxation year as otherwise determined, and (

b) the ratio of 365 to the number of days in the taxation year.

(1.141) For the purposes of subsection (1.12), if the last tax ation year of a corporation that is not a new corporation referted to in subsection (1.145) ending before the particular time, referted to in this subsection as the "actual taxation year", (

a) is the corporation's first taxation year, and (

b) consists of less than 365 days, the last taxation year of the corporation ending before the particular time is deemed to commence 365 days prior to the first day of the taxation year immediately following the actual taxation year and to end on the last day of the actual taxation year.

(1.142) For the purposes of subsection (1.12)(b), if the last taxation year of a corporation that is not a new corporation referred to in subsection (1.141) or (1.145) ending before the particular time, referred to in this subsection as the "actual taxation year", consists of less than 365 days, the last taxation year of the corporation ending before the particular time is deemed to commence 365 days prior to the first day of the taxation year immediately following the actual taxation year and to end on the last day of the actual taxation year.

(1.143) If a corporation is a new corporation, other than a corporation referred to in subsection (1.144), and does not have a taxation year ending before the particular time, (

a) for the purposes of subsection (1.12)(

a) and (b)(i), the corporation is deemed to have a taxation year that com mences on the date the corporation commences to carry on business and ends on the date immediately prior to the particular time, and (

b) for the purposes of subsection (1.12)(b)(ii), the cor poration is deemed to have a taxation year that com mences 365 days prior to the particular time and ends on the date immediately prior to the particular time.

(1.144) For the purposes of subsection (1.12), if a corporation IS a new corporation formed by the amalgamation of 2 or more predecessor corporations and the new corporation does

Explanatory Notes

not have a taxation year ending before the particular time, the new corporation is deemed (

a) to have a taxation year that commences 365 days prior to the particular time and ends on the date immediately prior to the particular time, (

b) to have Alberta crown royalty in that taxation year in an amount equal to the aggregate of (

i) the Alberta crown royalty of each predecessor cor poration for the period described in clause (a), and (ii) the Alberta crown royalty of the new corporation for the period described in clause (a), and (

c) to be associated with a corporation that is associated with a predecessor corporation of the new corporation during the 365-day period described in clause (a).

(1.145) For the purposes of subsection (1.12), if a corporation is a new corporation formed by the amalgamation of 2 or more predecessor corporations and the last taxation year of the new corporation ending before the particular time, re ferred to in this subsection as the "actual taxation year", is the corporation's first taxation year and consists of less than 365 days, (

a) the last taxation year of the new corporation ending before the particular time is deemed to commence 365 days prior to the first day of the taxation year immedi ately following the actual taxation year and to end on the last day of the actual taxation year, (

b) the new corporation is deemed to have Alberta crown royalty in that last taxation year in an amount equal to the aggregate of (

i) the Alberta crown royalty of each predecessor cor poration for the 365-day period described in clause (a), and (ii) the Alberta crown royalty of the new corporation for the 365-day period described in clause (a), and (

c) the new corporation is deemed to be associated with a corporation that is associated with a predecessor cor poration of the new corporation during the 365-day pe riod described in clause (a).

(1.15) Notwithstanding subsection (3), if the Provincial Treasurer is satisfied that (

a) the separate existence of 2 or more corporations at any time is not solely for the purpose of carrying out the business of those corporations in the most effective man ner, and

Explanatory Notes

(

b) one of the main reasons for the separate existence of the corporations is to avoid 1 or more of those corpora tions' remaining or becoming a restricted corporation, the Provincial Treasurer may direct that all of the corpora tions are deemed to be associated with each other during a taxation year for the purposes of subsection (1.12). (

c) in subsection (1.2) by striking out "subsection (l)(f)" and sub stituting "subsection (l)(h)(i)"; (

d) by repealing subsection (1.5) and substituting the following:

(1.5) Notwithstanding subsections (l)(e), (1.7), (1.8) and (1.9), if at any time control of an exempt corporation is acquired by a person, that corporation is deemed not to be an exempt corporation for the taxation year in which control is acquired and for all subsequent taxation years unless the Provincial Treasurer is satisfied that the result of the acquisition of con trol of the corporation by that person is not to increase the amount of royalty tax credit that would otherwise be deter mined under this Act.

(1.51) For the purposes of this Division, if at any time after April 7, 1986 control of a restricted corporation is acquired by a person and on the date of the acquisition of control the restricted corporation owns any right or interest of any nature whatsoever or howsoever described or part thereof in any production from a petroleum or natural gas well in Alberta, the restricted corporation is deemed to have disposed of and reacquired that right, interest or

part immediately prior to the date of the acquisition of control unless the Provincial Treas urer is satisfied that the result of the acquisition of control of the restricted corporation by that person is not to increase the amount of royalty tax credit that would otherwise be de termined under this Act.

(1.52) If at any time after April 7, 1986 control of a corpo ration is acquired by a person and the corporation is associ ated with a restricted corporation immediately prior to the date of the acquisition of control, the corporation is deemed to have been a restricted corporation immediately prior to the date of the acquisition of control.

(1.53) For the purposes of this Division, if a new corporation is formed by the amalgamation at any time after April 7,1986 of 2 or more predecessor corporations and as a result of the amalgamation the property owned by a predecessor corpora tion immediately before the date of the amalgamation that consisted of any right or interest of any nature whatsoever or howsoever described or part thereof in any production from a petroleum or natural gas well in Alberta became the prop erty of the new corporation, the predecessor corporation is deemed to have disposed of that right or interest and the new corporation is deemed to have acquired that right or interest on the date of the amalgamation unless the Provincial Treas urer is satisfied that the resuft of the amalgamation is not to increase the amount of royalty tax credit that would other wise be determined under this Act.

Explanatory Notes

(

e) in subsection (1.6) by striking out "and (1.8)" and substituting ",(1.8) and (1.92)"; (

f) by adding the following after subsection (1.8):

(1.9) Notwithstanding subsection (l)(e), if at any time after March 31,1986 a new corporation is formed by the amalgam ation of (

a) a corporation and 1 or more of its subsidiary wholly- owned corporations, or (b) 2 or more corporations, each of which is a subsidiary wholly-owned corporation of the same corporation, and 1 of the corporations referted to in clause (

a) or (

b) is an exempt corporation immediately prior to the date of the amalgamation, the new corporation is deemed to be an ex empt corporation as of the first day of its first taxation year.

(1.91) If at any time after April 7, 1986 a restricted corpora tion (

a) amalgamates with (i) 1 or more of its subsidiary wholly-owned corpo rations, (ii) 1 or more corporations, each of which is a subsid iary wholly-owned corporation of the same corpora tion of which the restricted corporation is a subsidiary wholly-owned corporation, or (iii) a corporation of which the restricted corporation is a subsidiary wholly-owned corporation, or (

b) is wound up in circumstances to which subsection 88(1) of the federal Act applies, and any right or interest of any nature whatsoever or how soever described or part thereof in any production from a petroleum or natural gas well in Alberta is deemed to have been disposed of to the new corporation pursuant to subsec tion (1.53) or is disposed of as a result of the winding-up, for the purposes of subsection (l)(h)(ii) that disposition is deemed not to have occurred.

(1.92) If at any particular time after April 7, 1986 a restricted corporation disposes of any right or interest of any nature whatsoever or howsoever described or part thereof in any production from a petroleum or natural gas well in Alberta to a corporation that is associated with it immediately before the date of the disposition, for the purposes of subsection (l)(h)(ii), (

a) that disposition is deemed not to have occurted, and 0?) the corporation acquiring the right, interest or

part is deemed to be a restricted corporation with respect to any disposition by it of any right or interest of any nature 10

10 Explanatory Notes

whatsoever or howsoever described or part thereof in any production from a petroleum or natural gas well in Alberta that takes place within 365 days of that particular time. (

g) by adding the following after subsection (3.1):

(3.2) For the purposes of this Division, if all the shares and rights to acquire shares of the capital stock of a corporation are owned directly or indirectly by 1 or more registered pen sion funds or plans and the corporation is associated with another corporation by reason only that the other corporation is (

a) a trustee under a trust pursuant to which the corpo ration is controlled, or (

b) associated with the trustee described in paragraph (a), the corporations are deemed not to be associated with each other in the taxation year unless, (

c) the corporation and the other corporation are other wise associated in the taxation year, or (

d) at any time in the taxation year, 20% or more of the issued shares of any class of the capital stock of each of the corporation and the other corporation is owned by 1 registered pension fund or plan.

(2) Subsection (l)(

a) to (

f) apply after March 31, 1986.

(3) Subsection (l)(

a) to (

f) do not apply to (

a) the disposition of property by a restricted corporation or a restricted partnership, or (

b) the acquisition of the control of a restricted corporation or a corporation associated with a restricted corporation if the property is disposed of or the control is acquired pursuant to the terms of a contract, other than an option, entered into and enforceable on or before Aprd 7, 1986.

(4) Subsection (l)(

g) applies to taxation years ending after this Act comes into force. 10(1)

Section 26.1 is amended (

a) by repealing subsections (2) and (3) and substituting the fol lowing:

(2) The specified percentage of a corporation's Alberta crown royalty for a taxation year is, (

a) for taxation years beginning after August 31, 1981 and ending before January 1, 1984, 75%, Oo) for taxation years beginning after December 31, 1983 and ending before April 1, 1986, 50%, and (

c) for taxation years beginning after December 31, 1986, 75%. 11

Section 26.1 presently reads in part:

(2) The specified percentage of a corporation's Alberta crown royalty for a taxation year is, (

a) for taxation years beginning after August 31, 1981 and ending before January 1, 1984, 75%, or (

b) for taxation years beginning after December 31, 1983, 50%.

(3) Subject to subsection (4), a corporation's maximum allowable credit for a taxation year is, (

a) for taxation years beginning after August 31, 1981 and ending before January 1, 1984, the lesser of (i) $4 000 000, and 11 Explanatory Notes

(3) Subject to subsection (4), a corporation's maximum allowable credit for a taxation year is, (

a) for taxation years beginning after August 31, 1981 and ending before January 1, 1984, the lesser of (i) $4 000 000, and (ii) that proportion of $4 000 000 that the number of days in the taxation year bears to 365, (

b) for taxation years beginning after December 31, 1983 and ending before April 1, 1986, the lesser of (i) $2 000 000, and (ii) that proportion of $2 000 000 that the number of days in the taxation year bears to 365, and (

c) for taxation years begiiming after December 31, 1986, the lesser of (i) $3 000 000, and (ii) that proportion of $3 000 000 that the number of days in the taxation year bears to 365. (

b) by repealing subsection (7) and substituting the following:

(7) The aggregate of the maximum allowable credits allo cated among corporations that are associated with each other shall not exceed, (

a) for taxation years beginning after August 31, 1981 and ending before January 1, 1984, the lesser of (i) $4 000 000, and (ii) that proportion of $4 000 000 that the number of days in the taxation year of the associated corporation with the longest year bears to 365, (

b) for taxation years beginning after December 31, 1983 and ending before April 1, 1986, the lesser of (i) $2 000 000, and (ii) that proportion of $2 000 000 that the number of days in the taxation year of the associated corporation with the longest year bears to 365, and (

c) for taxation years beginning after December 31, 1986, the lesser of (i) $3 000 000, and (ii) that proportion of $3 000 000 that the number of days in the taxation year of the associated corporation with the longest year bears to 365. (

c) by repealing subsection (13) and substituting the following:

(13) Notwithstanding subsection (2), if a corporation is a member of a partnership whose fiscal period begins before 12

(ii) that proportion of $4 000 000 that the number of days in the taxation year bears to 365, and (

b) for taxation years beginning after December 31, 1983, the lesser of (i) $2 000 000, and (ii) that proportion of $2 000 000 that the number of days in the year bears to 365.

(7) The aggregate of the maximum allowable credits allocated amongst corporations that are associated with each other shad not exceed, (

a) for taxation years beginning after August 31, 1981 and ending before January 1, 1984, the lesser of (i) $4 000 000, and (ii) that proportion of $4 000 000 that the number of days in the taxation year of the associated corporation with the longest year bears to 365, and (

b) for taxation years beginning after December 31, 1983, the lesser of (i) $2 000 000, and (ii) that proportion of $2 000 000 that the number of days in the taxation year of the associated corporation with the longest year bears to 365.

(13) Notwithstanding subsection (2), if a corporation is a member of a partnership whose fiscal year begins before September 1,1981 or ends after December 31, 1983 and the corporation is deemed to have Alberta crown royalty under subsection (12), the specified percentage for the part of that deemed Alberta crown royalty that is in respect of royalties that became receivable or payable (

a) before September 1, 1981 shad be determined as if the reference in subsection (2)(

a) to "75%" were to "25%", and (

b) before January 1, 1984 shall be determined as if the reference in subsection (2)(

b) to "50%" were to "75%".

(14) A corporation is entitled to a royalty tax credit in respect of the tax ation year only if it files an application for the credit in the prescribed form (

a) with its return for that taxation year, or (

b) on a day after the return has been filed, but no later than 90 days from the date of mailing of the notice of assessment, reassessment, determination or redetermination, as the case may be, but in no case shall a corporation be entitled to a royalty tax credit unless it files an application for the credit within 1 year from the end of that taxation year 12 Explanatory Notes

September 1, 1981 or ends before January 1, 1985 and the corporation is deemed to have Alberta crown royalty under subsection (12) or (12.1), the specified percentage for the part of that deemed Alberta crown royalty that is in respect of royalties that became receivable or payable (

a) before September 1, 1981 shall be determined as if the reference in subsection (2)(

a) to "75%" were to "25%", and (

b) before January 1, 1984 shaU be determined as if the reference in subsection (2)(

b) to "50%" were to "75%".

(13.1) Notwithstanding subsection (2), if a corporation is a member of a partnership whose fiscal period ends after De cember 31, 1986 and the corporation is deemed to have Alberta crown royalty under subsection (12) or (12.1), the specified percentage for the part of that deemed Alberta crown royalty that is in respect of royalties that became receivable or payable (

a) before January 1, 1987 and after March 31, 1986 shall be determined as if the reference in subsection (2)(

c) to "75%" were to "95%", and (

b) before April 1, 1986 shall be determined as if the reference in subsection (2)(

c) to "75%" were to "50%"; (

d) in subsection (14) by striking out "but in no case shall a cor poration be entitled to a royalty tax credit unless it files an ap plication for the credit within 1 year from the end of that taxation year".

(2) Subsection (l)(

a) to (

c) apply after March 31, 1986.

(3) Subsection (l)(

d) applies to taxation years commencing on or after January 1, 1984. 11(1) The following is added after

section 26.3: 26.31(1) Notwithstanding

section 26.1(1) to (8) and (13.1), (

a) if a corporation has Alberta crown royalty in a taxation year part or'all of which is in the period commencing April 1, 1986 and ending December 31, 1986, or (

b) if a corporation has Alberta crown royalty in a taxation year when it is associated with another corporation in a tax ation year of the other corporation part or aU of which is in the period commencing April 1, 1986 and ending December 31, 1986, it is entitled to a royalty tax credit for the year in an amount equal to the aggregate of (

c) the lesser of (i) 50% of the corporation's Alberta crown royalty for the year, and (ii) the corporation's maximum aUowable credit for the year determined under subsection (2), 13

11 Transitional provisions. '^ Explanatory Notes

and (

d) the lesser of (

i) the aggregate of (A) 45% of the corporation's Alberta crown royalty for the period in the year after March 31, 1986 and before January 1, 1987, and (B) 25% of the corporation's Alberta crown royalty for the period in the year after December 31, 1986, and (

u) the corporation's additional maximum aUowable credit for the year determined under subsection (3).

(2) A corporation's maximum allowable credit for a taxation year is the lesser of (a) $2 000 000, and (

b) that proportion of $2 000 000 that the number of days in the taxation year bears to 365, unless in the year the corporation is associated with another cor poration, in which case the corporation's maximum allowable credit for the year is the amount allocated to the corporation under subsection (4) or (6).

(3) A corporation's additional maximum allowable credit for a taxation year is the lesser of (a) $1000 000, and (

b) that proportion of $1 000 000 that the number of days in the taxation year after March 31, 1986 bears to 365, unless in the year the corporation is associated with another cor poration, in which case the corporation's additional maximum allowable credit for the year is the amount allocated to the cor poration under subsection (5) or (6).

(4) The Provincial Treasurer shall allocate to each corporation in a group of corporations that are associated with each other a maximum allowable credit equal to the proportion of the amount determined under subsection (7) that (

a) the lesser of (

i) that corporation's Alberta crown royalty, and (ii) $4 000 000 is of (

b) the aggregate of the amounts determined under clause (

a) for each corporation in the group of associated corporations.

(5) The Provincial Treasurer shall allocate to each corporation in a group of corporations that are associated with each other an additional maximum aUowable credit equal to that proportion of the amount determined under subsection (8) that 14

14 Explanatory Notes

(

a) the lesser of (

i) that corporation's Alberta crown royalty for the period in the year after March 31, 1986, and (ii) $4 000 000 is of (

b) the aggregate of the amounts determined under clause (

a) for each corporation in the group of associated corporations.

(6) Notwithstanding subsections (4) and (5), if 2 or more corpo rations that are associated with each other file an agreement in the prescribed form with the Provincial Treasurer and that agree ment (

a) is among all of the associated corporations, and (

b) allocates the relevant amounts under subsections (7) and (8) to any or all of the associated corporations, the Provincial Treasurer shall allocate the maximum allowable credit and the additional maximum allowable credit among the associated corporations in accordance with the agreement.

(7) The aggregate of the maximum allowable credits allocated among corporations that are associated with each other shall not exceed the lesser of (a) $2 000 000, and (

b) the proportion of $2 000 000 that the number of days in the taxation year of the associated corporation with the long est year bears to 365.

(8) The aggregate of the additional maximum allowable credits allocated among corporations that are associated with each other shaU not exceed the lesser of (a) $1000 000, and (

b) that proportion of $1 000 000 that the number of days after March 31, 1986 in the taxation year of the associated corporation whose taxation year contains the greatest number of days after March 31, 1986 bears to 365.

(2) Subsection (

I) applies after March 31, 1986. 12

Section 26.41(

b) is amended by striking out "excluded" and sub stituting "deducted". 15

Section 26.41 presently reads: 26.41 The aggregate of all royalty tax credits paid under this Act shall (

a) be applied by the Provincial Treasurer to reduce non-renewable resource revenue, as defined in the Alberta Heritage Savings Trust Fund Act, and (

b) be excluded from the total amounts used to determine the transfers required to be made to the Alberta Heritage Savings Trust Fund pur suant to

section 5 of the Alberta Heritage Savings Trust Fund Act or any Special Act referred to in that

section and enacted before or after the commencement of this section, notwithstanding anything in those Acts. 15 Explanatory Notes

13(1)

Section 26.5(l)(d)(ii) is amended by striking out "January 1, 19S6" and substituting "My 1, 1987". (2) Subsection (1) applies after 1985. 14(1)

Section 30(7) is amended by striking out "paragraphs 131(l.l)(

b) and (6)(c)" and substituting "^ditd^.^diTph 131(l.l)(b)". (2) Subsection (1) applies to 1985 and subsequent taxation years. 15

Section 32(3) is repealed. 16(1)

Section 35(3)(

b) is amended by striking out "property described in any of paragraphs 59(2)(

a) to (

e) of the federal Act" and substitut ing "a Canadian resource property or foreign resource property". (2) Subsection (1) applies to taxation years commencing after 1984. 16

Section 26.5(l)(

d) presently reads: 26.5(1) In this Division, (d) "qualifying Alberta multiple unit residential building" means a property that is a multiple unit residential building in Alberta in re spect of which (

i) a notification of eligibility has been issued by the Department of Housing certifying that the installation of footings or any other base support of the building was commenced after December 31, 1981 and before January 1, 1984 and that, according to plans and specifications for the budding, not less than 80% of the floor space wid be used in providing self-contained domestic establishments arui related parking, recreation, service and storage areas, (ii) a certificate of completion has been issued by the Department of Housing before January 1, 1986, and (iii) immediately after the certificate of completion has been is sued, not more than 20% of the floor space is used for any pur poses other than those referred to in subclause (i). 14

Section 30(7) presently reads: (7) Subsections 131(1.3), (1.4), (5) and (9) and paragraphs 131(1. l)(

b) and (6)(

c) of the federal Act do not apply for the purposes of this Act. 15

Section 32(3) presently reads:

(3) In the application of subsection 137(7) of the federal Act, the references to sections 123.4, 123.5, 127 and 127.1 are struck out and the reference to

section 125 shad be deemed to be a reference to

section 22 of this Act. 16

Section 35(3) presently reads:

(3) If at any time after November 12, 1981, a corporation ceases to be exempt from tax under this Act on its taxable income, the following rules apply: (

a) the taxation year of the corporation that would otherwise have included that time shall be deemed to have ended at that time and a new taxation year shall be deemed to have commenced immediately thereafter, (

b) the corporation shall be deemed to have disposed, immediately before that time, of each property, other than property described in any of paragraphs 59(2)(

a) to (

e) of the federal Act, that was owned by it immediately before that time for an amount equal to its fair market value at that time and to have reacquired the property immediately after that time at a cost equal to that fair market value, and (

c) where clause (

b) applies in respect of depreciable property of the corporation and the capital cost thereof to the corporation immedi ately before that time exceeds the fair market value thereof at that time, for the purposes of

section 8, (

i) the capital cost of the property to the corporation immediately after that time shall be deemed to be the amount that was its capital cost thereof before that time, and (ii) the excess shall be deemed to have been allowed to the cor poration in respect of the property in computing its income for taxation years ending before that time. 16 Explanatory Notes

(1) Section 38 is amended (

a) in subsection (1), (

i) by striking out "during the 14-month period ending 2 months after the close of each taxation year" and substituting "in respect of each of its taxation years"; (ii) in clause (a)(

i) by striking out "of the first 12 months in that period" and substituting "month in the year"; (iii) by repealing clause (a)(ii) and substituting the following: (ii) on or before the last day of each of the first 2 months in the year, an amount equal to 1/12 of its 2nd instalment base for the year and, on or before the last day of each of the foUowing months in the year, an amount equal to 1/10 of the amount remaining after deducting the amount computed pursuant to this subclause in respect of the first 2 months from its first instalment base for the year, or (iv) in clause (a)(iii) by striking out "of the first 12 months in that period" and substituting "month in the year"; (

v) by repealing clause (

b) and substituting the following: (

b) on or before the end of the 2nd month following the year, the remainder of the tax payable by it under this Act for the year. (

b) in subsection (3), (

i) by striking out "is estimated by it to be" and substituting "or the immediately preceding taxation year is"; (ii) by striking out "the period ending 3 months after the close of the year, the whole of the tax as estimated by it under

section 36(3)" and substituting "the 3rd month following the end of the year, the whole of the tax payable by it under this Act for the year"; (

c) by repealing subsections (6) and (7).

(2) Subsection (l)(

a) and (

b) apply to 1986 and subsequent taxation years.

(3) Subsection (l)(

c) applies to taxation years ending after 1986. 17

Section 38(1), (3), (6) and (7) presently read: 38(1) Subject to subsections (1.1) and (2), a corporation shall, during the 14-month period ending 2 months after the close of each taxation year pay to the Provincial Treasurer (

a) either (

i) on or before the last day of each of the first 12 months in that period an amount equal to 1/12 of its tax payable under

Part 5 for that year as estimated by it, (ii) on or before the last day of each of the first 2 months in that period, an amount equal to 1/12 of its 2nd instalment base for the year and, on or before the last day of each of the next following 10 months in that period, an amount equal to 1/10 of the amount remaining after deducting the amount computed pursuant to this clause in respect of the first 2 months of the period from its first instalment base for the year, or (iii) on or before the last day of each of the first 12 months in that period, an amount equal to 1/12 of its first instalment base for the year and (

b) on or before the last day of the period, the amount of the tax payable estimated by it under

section 36(3) less the amount paid under clause (a).

(3) When a corporation (

a) has held forth the prospect that it wid make allocations in propor tion to patronage to its customers of a taxation year as described by

section 135 of the federal Act, as made applicable by

section 31 of this Act, or (

b) is a credit union and its taxable income for the year is estimated by it to be not more than $10 000, it may, instead of paying the instalments required by subsection (1), pay to the Provincial Treasurer, on or before the last day of the period ending 3 months after the close of the year, the whole of the tax as esti mated by it under

section 36(3).

(6) If a corporation has applied for a refundable tax credit for a taxation year on or before the date on which the corporation is required to file a return under

section 36(1), the Provincial Treasurer shall determine the amount of the credit, and may apply the amount of the credit so deter mined as payment of any tax, interest, penalty or other amount otherwise owing by the corporation for that or any preceding taxation year under this Act as of the date on which the credit was applied for

(7) If a corporation has applied for a royalty tax credit for a taxation year and for royalty tax credit instalments under

section 26.4 in respect of that year the amount of the royalty tax credit that is applied under subsection (6) shall equal the amount by which (

a) the amount of the royalty tax credit as determined exceeds (

b) the aggregate of the amounts of the royalty tax credit instalments payable to the corporation under

section 26.4 in respect of the year less any amounts paid by the corporation in respect of the year under subsection (8). 17 Explanatory Notes

18(1)

Section 39 is amended (

a) by repealing subsection (2) and substituting the following:

(2) In addition to the interest payable under subsection (1), if a corporation required by this Act to pay tax or an instal ment of tax fails to pay all or part of the tax or instalment on or before the day on or before which the tax or instalment, as the case may be, was required to be paid, the corporation shall pay to the Provincial Treasurer interest at the prescribed rate on the amount that it failed to pay computed from the day on or before which the amount was required to be paid to the day of payment or to the beginning of the period in respect of which it is required to pay interest under subsection (1), whichever is earlier. (

b) by repealing subsection (3)(

b) and substituting the following; (

b) the amount by which the tax payable by the corporation for the year is reduced by virtue of the exclusion or deduction of an amount described in clause (

a) shall be deemed to have been paid by the corporation on account of tax payable for the year on the day that is the latest of (

i) the first day immediately following that subsequent taxation year, (ii) the day on which the corporation's retum under sec tion 36 for that subsequent taxation year was filed, (iii) if an amended retum for the taxation year or a pre scribed form amending its retum for the year was filed under this Act by virtue of the application of subsection 49(4) of the federal Act or

section 44 of this Act, the day on which the amended retum or prescribed form was filed, and (iv) if, as a consequence of a request in writing, the Prov incial Treasurer reassessed the corporation's tax for the year to take into account the exclusion or deduction, the day on which the request was made. (

c) by adding the following after subsection (4):

(5) Notwithstanding any other provision in this section, if the tax payable under this Act by a corporation for a taxation year is increased by virtue of an adjustment of an income or profits tax payable by it to the govemment of a country other than Canada or to the govemment of a state, province or other political subdivision of such a country, no interest is payable in respect of that increase in the corporation's tax payable for the period ending 90 days after the day on which the corporation is first notified of the amount of the adjust ment.

(2) Subsection (l)(

a) applies to 1986 and subsequent taxation years.

(3) Subsection (l)(

b) applies with respect to subsequent taxation years referred to in

section 39(3)(

b) of the Alberta Corporate Income Tax Act as enacted by subsection (l)(

b) that end after 1986. 18

Section 39(2) and (3) presently read:

(2) In addition to the interest payable under subsection (1) (

a) if a corporation required by this Act to pay ad or a part or instal ment of tax has faded to pay ad or any part or instalment, the cor poration shall, on payment of the amount that it failed to pay, pay interest at the prescribed rate per year from the day on or before which the corporation was required to make the payment to the day of pay ment or the beginning of the period in respect of which it becomes liable to pay interest under subsection (I), whichever is earlier and (

b) if a corporation that paid tax under

section 38(3) had a taxable income for a taxation year of more than $10 000, it shad in addition forthwith after assessment pay a penalty equal to 3% of the tax pay able by it under this Act for the taxation year.

(3) For the purpose of computing interest under subsection (1) or (2) on tax or a part or an instalment of tax for a taxation year, (

a) the tax payable by the corporation for the year shad be deemed to be the amount that it would have been if none of the following amounts, namely, (

i) any amount deducted under this Act by virtue of the applica tion of

section 41 of the federal Act in respect of its listed-personal- property loss for a subsequent taxation year (ii) any amount excliuied from its income for the year under this Act by virtue of the application of

section 49 of the federal Act in respect of the exercise of an option in a subsequent taxation year, or (iii) any amount deducted under this Act by virtue of the appli cation of

section 111 of the federal Act in respect of a loss for a subsequent taxation year, were so excluded or deducted for the year, as the case may be, and (

b) the amount by which the tax payable by the corporation for the year is reduced by virtue of the exclusion or deduction of an amount described in clause (a)(

i) to (iii) shad be deemed to have been paid by the corporation on account of tax payable for the year on the day on which the corporation's return under

section 36 was filed for that sub sequent taxation year. 18 Explanatory Notes

(4) Subsection (l)(

c) applies with respect to notifications made after 1980. 19

Section 41(2) is amended by striking out "and that amount is different from the amount reported by the corporation in its retum filed for the taxation year, the Provincial Treasurer shall, only" and substituting "and the corporation has not reported that amount as a non-capital loss, net capital loss, restricted farm loss or farm loss in its retum filed for that year, the Provincial Treasurer shall,". 20

Section 43(l)(c)(ii) is amended by striking out "6 months" and substituting "12 months". 21(1)

Section 46 is repealed and the following is substituted: 46 If the Provincial Treasurer sends a notice of assessment of any amount payable by a corporation, that part of the amount 19

Section 41(2) presently reads:

(2) When the Provincial Treasurer ascertains the amount of a corpora tion's non-capital loss, net capital loss, restricted farm loss or farm loss for a taxation year and that amount is different from the amount reported by the corporation in its return filed for the taxation year, the Provincial Treasurer shall, only at the request of the corporation, determine with ad due dispatch the amount of the corporation's non-capital loss, net capital loss, restricted farm loss or farm loss, as the case may be, and shall send a notice of determination to the person who filed the return. 20

Section 43(1) presently reads: 43(1) The Provincial Treasurer may, at any time, assess tax, interest or penalties under this Act or notify in writing any corporation that filed a return for a taxation year that no tax is payable for a taxation year and may determine the entitlement to and the amount, if any, of a corpora tion's refundable tax credit, and may (

a) at any time, if the corporation filing the return (

i) has made a misrepresentation that is attributable to neglect, carelessness or wilful default or has committed any fraud in filing the return or in supplying any information under this Act, or (ii) has filed with the Provincial Treasurer a waiver in the pre scribed form within 3 years from the day of mailing of a notice of an original assessment or a notification that no tax is payable for a taxation year, (

b) within 6 years from the day referred to in clause (a)(ii), if (

i) an assessment or reassessment of the tax of the corporation was required pursuant to

section 44 or would have been required if the corporation had claimed an amount by filing the prescribed form referred to in that

section on or before the day referred to in that section, or (ii) there is reason, as a consequence of the assessment or reas sessment of another corporation's tax pursuant to this clause or

section 44, to assess or reassess the corporation's tax for any rel evant year, and (

c) in any case other than those described in clauses (

a) and (b), within (i) 3 years from the day referred to in clause (a)(ii), or (ii) 6 months after an assessment, reassessment or additional as sessment under the federal Act or the confirmation of an assess ment, reassessment or additional assessment under the federal Act, reassess or make additional assessments, or assess tax, interest or penalties under this Act and determine the entitlement to and the amount, if any, of the refundable tax credits, as the circumstances require, except that a reassessment, additional assessment or assessment may be made under clause (

b) after 3 years from the day referred to in clause (a)(ii) only to the extent that it may reasonably be regarded as relating to the assessment or reassessment referred to in clause (b). 21

Section 46 presently reads: 46(1) A corporation shad, within 30 days from the day of mailing of the notice of assessment, pay to the Provincial Treasurer 19 Explanatory Notes

then remaining unpaid is payable forthwith by the corporation to the Provincial Treasurer. (2) Subsection (1) is applicable with respect to notices of assessment sent after this Act comes into force. 22(1)

Section 47 is amended (

a) in subsection (2)(a) (

i) by striking out "on mailing" and substituting "on or after mailing"; (ii) by adding "for the year" after "overpayment"; (

b) by adding the following after subsection (2);

(2.1) Subject to subsection (2.2), if a corporation (

a) has under

section 48 served a notice of objection to an assessment of tax, interest under

section 39(1) or (2) or a penalty and the Provincial Treasurer has not within 120 days after the day of service confirmed or varied the assessment or made a reassessment in respect of the as sessment, or (

b) has appealed to the court from an assessment of tax, interest under

section 39(1) or (2) or a penalty, and has applied in writing to the Provincial Treasurer for a payment or surrender of security, the Provincial Treasurer shall with all due dispatch repay all amounts paid or applied on account of the amount assessed or surtender security ac cepted for the amount assessed to the extent that (

c) the lesser of (

i) the aggregate of the amounts so paid or applied and the value of the security, and (ii) the amount so assessed exceeds (

d) the amount, if any, so assessed that is not in contro versy.

(2.2) If it may reasonably be considered that collection of all or any part of an amount assessed in respect of a corporation would be jeopardized by a repayment of an amount or sur render of security to the corporation under subsection (2.1), the Provincial Treasurer may direct that the repayment of the amount or a part of it not be made or that the security or 20

(

a) any part of the assessed tax, interest and penalties then remaining unpaid, and (

b) any amount by which the aggregate of amounts paid to the cor poration with respect to a refundable tax credit less any payments made by the corporation under

section 38(8) exceeds the amount of that refundable tax credit as determined under

section 43(1), whether or not an objection to or appeal from the assessment or determi nation is outstanding.

(2) If, in the opinion of the Provincial Treasurer, a corporation is attempt ing to avoid payment of taxes or repayment of any excess payments of refundable tax credits, the Provincial Treasurer may direct that all taxes, penalties, interest and excess payments of refundable tax credits be paid or repaid forthwith on assessment. 22

Section 47(2), (3), (4), (4.3), (4.4), (5) and (6) presently read:

(2) If the return required to be filed by a corporation under

section 36 for a taxation year has been filed within 3 years from the end of that year, the Provincial Treasurer (

a) may, on mailing the notice of assessment for the taxation year, refund without application for the refund any overpayment, and (

b) shall, with all due dispatch, make the refund after mailing the notice of assessment if application for the refund has been made in writing by the corporation within (

i) the 6 year period referred to in

section 43(l)(b), where that clause applies, and (ii) in any other case, either of the periods referred to in

section 43(l)(c).

(3) Instead of making a refund or repayment that might otherwise be made under this section, the Provincial Treasurer may, if the corporation is liable or about to become liable to make another payment under this Act, apply the amount of the overpayment to that other liability and notify the corporation of that action.

(4) If an amount in respect of an overpayment for a taxation year is refunded or applied under this

section to another liability, interest at the prescribed rate shad be paid or applied to the amount for the period comm encing (

a) the day when the overpayment arose, (

b) the day on or before which the return for the year was required to be filed, and (

c) the day when the return of the corporation for the year was actually filed whichever day is latest and ending with the day of refund or application of overpayment under subsection (3).

(4.3) If, at any particular time, interest has been paid to, or applied to a liability of, a corporation pursuant to subsection (4) in respect of an over payment and it is determined at a subsequent time that the actual over payment was less than the overpayment in respect of which interest was paid or applied, the following rules apply: (

a) the amount by which the interest that has been paid or applied exceeds the interest, if any, computed in respect of the amount that is determined at the subsequent time to be the actual overpayment shall be deemed to be an amount, in this subsection referred to as "the 20 Explanatory Notes

part of it not be surtendered and shaU give notice of the direction to the corporation by personal service or by regis tered letter addressed to the corporation at its latest known address.

(2.3) If, pursuant to subsection (2.2), the Provincial Treasurer has given notice to the corporation of a direction,

section 60.2(2) to (7) are applicable in respect of the direction. (

c) in subsection (3) by striking out "overpayment" and substitut ing "refund or repayment"; (

d) by repealing subsection (4) and substituting the following:

(4) If under this

section an amount in respect of a taxation year is refunded or repaid to a corporation or applied to an other liability, the Provincial Treasurer shall pay or apply interest on the amount at the prescribed rate for the period beginning on the day that is the latest of (

a) in the case of a refund or application of an overpay ment, the day the overpayment arose, (

b) the day on which the retum of the corporation for the year was filed, and (

c) in the case of a repayment of an amount in contro versy, the day an overpayment equal to the amount of the repayment would have arisen if the aggregate of aU amounts payable on account of the corporation's liability under this Act for the year were the amount by which (

i) the lesser of the aggregate of aU amounts paid or applied on account of its hability under this Act for the year and the aggregate of aU amounts assessed by the Provincial Treasurer as payable under this Act by the corporation for the year exceeds (ii) the amount repaid, and ending on the day the amount is refunded, repaid or apphed. (

e) by repealing subsection (4.1)(b); (

f) by repealing subsection (4.3)(

b) and substituting the following: (

b) the corporation shaU pay to the Provincial Treasurer in terest at the prescribed rate on the amount payable computed from the particular time to the day of payment; (

g) in subsection (4.4)(

d) by adding "unless otherwise directed in writing by the corporation," after "Court,"; (

h) in subsection (4.4)(

e) by striking out "unless otherwise di rected in writing by the taxpayer,"; (

i) by repealing subsection (5) and substituting the following;

(5) If at any particular time interest has been paid to, or apphed to a hability of, a corporation pursuant to subsection (4) in respect of the repayment of an amount in controversy 21

amount payable", that became payable under this Act by the corpo ration at the particular time; (

b) the corporation shad pay interest, at the rate prescribed, on the amount payable for the period beginning at the particular time and ending on the date of payment; (

c) the Provincial Treasurer may, at any time, assess the corporation in respect of the amount payable and, where the Provincial Treasurer makes that assessment, this Act applies, with any necessary modifi cations, in respect of the assessment as though it had been made under

section 43.

(4.4) Where the Court of Queen's Bench, the Court of Appeal or the Su preme Court of Canada has, on the disposition of an appeal in respect of taxes, interest or a penalty payable by a corporation, or a refundable tax credit payable to a corporation under this Act, (

a) referred an assessment back to the Provincial Treasurer for recon sideration and reassessment, (

b) varied or vacated an assessment, or (

c) ordered the Provincial Treasurer to repay tax, interest or penalties, or to pay a refundable tax credit, the Provincial Treasurer shad with ad due dispatch, whether or not an appeal from the decision of the Court has been or may be instituted, (

d) where the assessment has been referred back to him, reconsider the assessment and make a reassessment in accordance with the de cision of the Court, (

e) refund any overpayment resulting from the variation, vacation or reassessment, unless otherwise directed in writing by the taxpayer, and (

f) where clause (

c) applies, repay any tax, interest or penalties, or pay any refundable tax credit as ordered, and the Provincial Treasurer may repay any tax, interest or penalties, pay any refundable tax credit or surrender any security accepted therefor by him to any other corporation that has filed an objection or instituted an appeal if, having regard to the reasons given on the disposition of the appeal, he is satisfied that it would be just and equitable to do so.

(5) If by a decision of the Provincial Treasurer under

section 48 or by a decision of the court, the Court of Appeal or the Supreme Court of Canada it is finally determined that the tax payable under this Act by a corporation for a taxation year is less than the amount assessed by the assessment under sections 41 to 46 to which objection was made or from which the appeal was taken and the decision is that there has been an overpayment for the taxation year, the interest payable under subsection (4) on that overpayment shall be computed in accordance with that subsection.

(6) For the purpose of computing interest under subsection (4), the portion of any overpayment of the tax payable by a corporation for a taxation year that arose as a consequence of (

a) the deduction of an amount under this Act by virtue of the appli cation of

section 41 of the federal Act in respect of its listed-personal- property loss for a subsequent taxation year (

b) the exclusion of an amount from its income for the year under this Act by virtue of the application of

section 49 of the federal Act in respect of the exercise of an option in a subsequent taxation year, or (

c) the deduction of an amount under this Act by virtue of the appli cation of

section 111 of the federal Act in respect of a loss for a sub sequent taxation year shad be deemed to have arisen on the day on which the return under

section 36 was filed for that subsequent taxation year 21 Explanatory Notes

made to or applied to a liability of the corporation and it is determined at a subsequent time that the repayment or a part of the repayment is payable by the corporation, the foUowing rules apply: (

a) the interest so paid or applied on that part of the repayment that is determined at the subsequent time to be payable by the corporation shaU be deemed to be an amount, in this subsection referted to as the "interest ex cess", that became payable by the corporation at the par ticular time; (

b) the corporation shall pay to the Provincial Treasurer interest at the prescribed rate on the interest excess com puted from the particular time to the day of payment; (

c) the Provincial Treasurer may at any time assess the corporation in respect of the interest excess and, where the Provincial Treasurer makes such an assessment, this

Part is apphcable with respect to the assessment as if it had been made under

section 43. (

j) by repealing subsection (6) and substituting the following:

(6) For the purpose of computing interest under subsection (4), the portion of any overpayment of the tax payable by a corporation for a taxation year that arose as a consequence of (

a) the deduction of an amount under this Act by virtue of the application of

section 41 of the federal Act in re spect of the corporation's listed-personal-property loss for a subsequent taxation year, (

b) the exclusion of an amount from the corporation's income for the year under this Act by virtue of the appli cation of

section 49 of the federal Act in respect of the exercise of an option in a subsequent taxation year, or (

c) the deduction of an amount under this Act by virtue of the apphcation of

section 111 of the federal Act in respect of a loss for a subsequent taxation year shall be deemed to have arisen on the day that is the latest of (

d) the first day immediately following that subsequent taxation year, (

e) the day on which the corporation's retum under sec tion 36 for that subsequent taxation year was filed, (

f) if an amended retum for the taxation year or a pre scribed form amending the corporation's retum for the year was filed under this Act by virtue of the application of subsection 49(4) of the federal Act or

section 44 of this Act, the day on which the amended retum or prescribed form was filed, and (

g) if, as a consequence of a request in writing, the Prov incial Treasurer reassessed the corporation's tax for the year to take into account the deduction or exclusion, the day on which the request was made. 22

22 Explanatory Notes

(

k) by adding the following after subsection (6):

(7) If a repayment made under subsection (2.1) or (4.4) or an amount applied under subsection (3) in respect of a repay ment, or a part of a repayment, may reasonably be regarded as being in respect of a claim made by a corporation in an objection to or appeal from an assessment of tax for a taxa tion year for (

a) the deduction of an amount under this Act by virtue of the application of

section 41 of the federal Act in re spect of the corporation's listed-personal-property loss for a subsequent taxation year, (

b) the exclusion of an amount from the corporation's income for the year under this Act by virtue of the appli cation of

section 49 of the federal Act in respect of the exercise of an option in a subsequent taxation year, or (

c) the deduction of an amount under this Act by virtue of the application of

section 111 of the federal Act in respect of a loss for a subsequent taxation year, interest shall not be paid or applied on the repayment or amount applied for any part of a period that is before the latest of (

d) the first day immediately following that subsequent taxation year, (

e) the day on which the corporation's retum under sec tion 36 for that subsequent taxation year was filed, (

f) if an amended retum for the taxation year or a pre scribed form amending the corporation's retum for the year was filed under this Act by virtue of the application of subsection 49(4) of the federal Act or

section 44 of this Act, the day on which the amended retum or prescribed form was filed, and (

g) if, as a consequence of a request in writing, the Prov incial Treasurer reassessed the corporation's tax for the year to take into account the deduction or exclusion, the day on which the request was made.

(2) Subsection (l)(

b) applies with respect to notices of objection served after 1984 and appeals from assessments objected to after 1984.

(3) Subsection (l)(

c) applies after February 15, 1984.

(4) Subsection (l)(

d) applies to refunds and repayments made and amounts applied after 1984, except that with respect to the refund, repayment or application of an amount paid by a corporation in re spect of a taxation year ending before January 1, 1987

section 47(4) of the Alberta Corporate Income Tax Act, as enacted by subsection (l)(d), shall be read as if the following clause were included after clause (a): (a.

l) the day on or before which the retum for the year was required to be filed,

(5) Subsection (l)(

e) applies to taxation years ending after 1986. 23

23 Explanatory Notes

(6) Subsection (l)(

g) and (

h) apply after February 15, 1984.

(7) Subsection (l)(

i) applies to repayments made or applied after 1984.

(8) Subsection (l)(

j) applies to subsequent taxation years referred to in

section 47(6) of the Alberta Corporate Income Tax Act, as enacted by subsection (l)(j), that end after 1986.

(9) Subsection (l)(

k) applies to repayments made or applied after 1984, except that if the subsequent taxation year referred to in

section 47(7) of the Alberta Corporate Income Tax Act, as enacted by subsection (l)(k), ends before 1985,

section 47(7) of the Alberta Corporate Income Tax Act, as enacted by subsection (l)(k), shall be read as if all that portion following clause (

c) were struck out and the following substi tuted: interest shall not be paid or applied on the repayment or amount applied for any part of a period that is before the day on which the corporation's retum under

section 36 was filed for that sub sequent taxation year. 23

Section 49 is repealed and the following is substituted: 49(1) Every person, other than a tmstee in bankmptcy, who is an assignee, liquidator, administrator, receiver, receiver-manager or any other like person, in this

section referted to as the "re sponsible representative", administering, winding-up, controlling or otherwise dealing with a property or business of a corporation, before distributing to 1 or more persons any property over which he has control in his capacity as the responsible representative, shall obtain a certificate from the Provincial Treasurer certifying that all amounts (

a) for which the corporation is liable under this Act in re spect of the taxation year in which the distribution is made, or any preceding taxation year, and (

b) for the payment of which the responsible representative is or can reasonably be expected to become liable in his ca pacity as the responsible representative have been paid or that security for the payment of the amounts has been accepted by the Provincial Treasurer.

(2) If a responsible representative distributes to 1 or more per sons property over which he has control in his capacity as the responsible representative without obtaining a certificate under subsection (1) in respect of the amounts referted to in that sub section, the responsible representative is personally liable for the payment of those amounts to the extent of the value of the prop erty distributed and the Provincial Treasurer may assess the re sponsible representative for the amounts in the same manner and with the same effect as if it were an assessment of the corporation made under

section 41. 24

Section 50(2) is amended by striking out "in the prescribed form". 24

Section 49 presently reads: 49(1) Every assignee, liquidator, administrator, executor or other similar person, other than a trustee in bankruptcy, shall, before distributing any property under its or his control, obtain a certificate from the Provincial Treasurer certifying that taxes, interest or penalties that have been assessed under this Act and that are chargeable against or payable out of the prop erty have been paid or that security for their payment has been accepted by the Provincial Treasurer in accordance with

section 55(3).

(2) Distribution of property without a certificate required by subsection (1) renders the person required to obtain the certificate personally liable for the unpaid taxes, interest and penalties. 24

Section 50(2) presently reads:

(2) An appeal to the court shall be instituted by serving on the Provincial Treasurer a notice of appeal in duplicate in the prescribed form and by filing a copy of the notice of appeal with the clerk of the court of a judicial district in which the corporation appealing has a permanent establishment. 24 Explanatory Notes

25 The following is added after

section 52(4):

(5) If the court disposes of an appeal by a corporation in respect of an amount payable under this Act or an appeal by a corpora tion has been discontinued or dismissed without trial, the court may, on the application of the Provincial Treasurer and whether or not it awards costs, order the corporation to pay to the Prov incial Treasurer an amount not exceeding 10% of the amount in controversy if it determines that there were no reasonable grounds for the appeal and that one of the main purposes of instituting or maintaining the appeal was to defer the payment of an amount payable under this Act. 26 The following is added after

section 55(3):

(3.1) If a corporation has objected to or appealed from an as sessment under this Act, the Provincial Treasurer shall accept adequate security fumished by or on behalf of the corporation for payment of the amount in controversy while the objection or appeal is outstanding.

(3.2) If at any time a corporation requests in writing that the Provincial Treasurer surrender any security accepted by the Prov incial Treasurer under subsection (3) or (3.1), the Provincial Treasurer shall surtender the security to the extent that the value of the security exceeds the aggregate of amounts payable under this Act by the corporation at that time. 27

Section 58(1) is amended by repealing clauses (

a) and (b). 28(1) The following is added after

section 60: 60.1(1) If a corporation is liable for the payment of an amount assessed under this Act, in this subsection referred to as the "un paid amount", the Provincial Treasurer shall not, for the purpose of collecting the unpaid amount, (

a) commence legal proceedings in the court, (

b) certify the unpaid amount under

section 58, or (

c) require a person to make a payment under

section 60, before the day that is 90 days after the day of maUing of the notice of assessment.

(2) If a corporation has served a notice of objection under this Act to an assessment of an amount payable under this Act, the Provincial Treasurer shaU not, for the purpose of collecting the amount m controversy, take any of the actions described in sub- sectioii (l)(

a) to (

c) before the day that is 90 days after the day on which notice is maUed to the corporation that the Provinci^ Treasurer has confirmed or varied the assessment. 25

Section 52(4) presently reads:

(4) The court may, in delivering judgment on an appeal, order payment or repayment of tax, a refundable tax credit, interest and penalties or costs by the taxpayer or the Provincial Treasurer 26

Section 55(3) presently reads:

(3) The Provincial Treasurer may, if he considers it advisable in a partic ular case, accept security for payment of debts due to Her Majesty in right of Alberta, within the meaning of

section 57, by way of mortgage or other charge of any kind on property of the taxpayer or any other person or by way of guarantee from other persons. 27

Section 58(1) presently reads: 58(1) An amount payable under this Act that has not been paid or that part of an amount payable under this Act that has not been paid may be certified by the Provincial Treasurer (

a) if there has been a direction by the Provincial Treasurer under

section 46(2), forthwith after that direction, and (

b) otherwise on the expiration of 30 days after default. 28 Restrictions on the collection by the Provincial Treasurer of amounts in dispute. 25 Explanatory Notes

(3) If a corporation has appealed to the court from an assessment of an amount payable under this Act, the Provincial Treasurer shaU not, for the purpose of collecting the amount in controversy, take any of the actions described in subsection (l)(

a) to (

c) before the day on which the judgment of the court takes effect or the day on which the corporation discontinues the appeal.

(4) If the Provincial Treasurer is notified that (

a) proceedings have been instituted in the Federal Court of Canada under

section 173 of the federal Act, or (

b) the Minister of National Revenue has applied to the Tax Court of Canada or the Federal Court of Canada under sec tion 174 of the federal Act, the Provincial Treasurer shall not take any of the actions de scribed in subsection (l)(

a) to (

c) for the purpose of collecting that part of an amount assessed, the liability for payment of which will be affected by the determination of the question that is the subject of the proceedings or application, before the day on which the question is determined by that court.

(5) Notwithstanding any other provision in this section, if a cor poration has served a notice of objection under this Act to an assessment or has appealed to the Court of Queen's Bench from the assessment and agrees in writing with the Provincial Treas urer to delay proceedings on the objection or appeal, as the case may be, until judgment has been given in another action before the Court of Queen's Bench, the Court of Appeal, the Tax Court of Canada, the Federal Court of Canada or the Supreme Court of Canada in which the issue is the same or substantially the same as that raised in the objection or appeal of the corporation, the Provincial Treasurer may take any of the actions described in subsection (l)(

a) to (

c) for the purpose of collecting the amount assessed, or a part of the amount, determined in a manner con sistent with the decision or judgment made in the other action at any time after the Provincial Treasurer notifies the corporation in writing that (

a) the decision has been made by the Court of Queen's Bench in that action, (

b) the decision has been made by the Court of Appeal in that action, (

c) the decision has been made by the Tax Court of Canada in that action, (

d) judgment has been pronounced by the Federal Court of Canada in that action, or (

e) judgment has been delivered by the Supreme Court of Canada in that action, as the case may be. 60.2(1) Notwithstanding

section 60.1, if it may reasonably be considered that collection of an amount assessed in respect of a 26

^" Explanatory Notes

corporation would be jeopardized by a delay in the collection of the amount and the Provincial Treasurer has, by notice served personally or by registered letter addressed to the corporation at its latest known address, so advised the corporation and directed the corporation to pay forthwith the amount assessed or any part of the amount, the Provincial Treasurer may forthwith take any of the actions described in

section 60.1(l)(

a) to (

c) with respect to that amount or the part of that amount.

(2) If the Provincial Treasurer has under subsection (1) directed a corporation to pay an amount forthwith, the corporation may (

a) on 3 days' notice of motion to the Deputy Attomey Gen eral, apply to a judge of the court for an order fixing a day, not earlier than 14 days nor later than 28 days after the date of the order, and a place for the determination of the question whether the direction was justified in the circumstances, (

b) serve a copy of the order on the Deputy Attomey General within 6 days after the day on which it was made, and (

c) if it has proceeded as authorized by clause (b), apply at the appointed time and place for an order determining the question.

(3) An application to a judge under subsection (2)(

a) shaU be made (

a) within 30 days after the day on which the notice under subsection (1) was served or mailed, or (

b) within any further time that the judge, on being satisfied that the application was made as soon as circumstances per mitted, may aUow.

(4) An application under subsection (2)(

c) may, on the applica tion of the corporation, be heard in private, if the corporation establishes to the satisfaction of the judge that the circumstances of the case justify in private proceedings.

(5) On the hearing of an application under subsection (2)(

c) the burden of justifying the direction is on the Provincial Treasurer.

(6) On an application under subsection (2)(c), the judge shaU de termine the question summarily and may confirm, vacate or vary the direction and make such other order as he considers appro priate.

(7) Costs shall not be awarded on the disposition of an applica tion under subsection (2). (2) Subsection (1) applies to (

a) notices of assessment mailed after 1984, (

b) notices of objection served after 1984, (

c) appeals from assessments objected to after 1984, and (

d) assessments made after 1984. 27

^' Explanatory Notes

29 Sections 62 to 65 are repealed and the following is substituted: 62 In sections 63 to 65, (a) "authorized person" means a person authorized by the Provincial Treasurer for the purposes of sections 63 to 65; (b) "documents" includes money, securities and any of the following, whether computerized or not: books, records, let ters, telegrams, vouchers, invoices, accounts and statements, financial or otherwise; (c) "dwelling-house" means the whole or any part of a build ing or stmcture that is kept or occupied as a permanent or temporary residence and includes (

i) a building within the curtilage of a dwelling-house that is connected to it by a doorway or by a covered and en closed passageway, and (ii) a unit that is designed to be mobile and to be used as a permanent oi" temporary residence that is being used as a permanent or temporary residence; (d) "judge" means a judge of the court. 63(1) An authorized person may, at all reasonable times, for any purpose related to the administration of this Act, (

a) inspect, audit or examine the books and records of a cor poration and any document of the corporation or of any other person that relates or may relate to the information that is or should be in the books or records of the corporation or to any amount payable by or to it under this Act, (

b) require the production for inspection, audit or examina tion of all books, records or documents that are or may be relevant to the inspection, audit or examination, and (

c) examine property in an inventory of a corporation and any property or process of, or matter relating to, the corpo ration or any other person, an examination of which may assist the authorized person in determining the accuracy of the inventory of the corporation or in ascertaining the infor mation that is or should be in the books or records of the corporation or any amount payable by or to it under this Act, and for those purposes the authorized person may, if he has rea sonable grounds to believe that books, records, documents or property described in clauses (

a) to (

c) are likely to be found in any premises or place, (

d) subject to subsection (3), enter into the premises or place, and (

e) require the owner or manager of the property or business and any other person on the premises or at the place to give him all reasonable assistance and to make reasonable efforts to answer all proper questions relating to the administration of this Act and, for that purpose, require the owner or man ager to attend at the premises or place with him. 28

29 Sections 62 to 65 presently read: 62 A person authorized by the Provincial Treasurer for any purpose re lated to the administration or enforcement of this Act may at ad reason able times enter any premises or place where any business is carried on in Alberta or any property is kept or anything is done in connection with any business or any books or records are or should be kept pursuant to this Act and may (

a) audit or examine the books and records and any account, voucher letter telegram or other document that relates or may relate to the information that is or should be in the books or records or the amount of tax payable or a refundable tax credit under this Act, (

b) examine property described by an inventory or any property, proc ess or matter an examination of which may in his opinion assist him in determining the accuracy of an inventory or in ascertaining the information that is or should be in the books or records or the amount of any tax payable or a refundable tax credit under this Act, (

c) require the president, manager secretary or any director agent or representative of the corporation liable to pay taxes or claiming a refundable tax credit or considered possibly liable to pay taxes or claim a refundable tax credit under this Act and any other person on the premises or place to give him ad reasonable assistance with his audit or examination and to answer ad proper questions relating to the audit or examination either orally or if he so requires in writing on oath or by statutory declaration and for that purpose require that person to attend at the premises or place with him, and (

d) if during the course of an audit or examination it appears to him that there has been a contravention of this Act or the regulations, seize and take away any of the documents, books, records, papers or things that may be required as evidence of the contravention of any provision of this Act or a regulation. 63(1) Unless a judge of the court on application made by or on behalf of the Provincial Treasurer orders that the documents, books, records, papers or things that were seized pursuant to

section 62(

d) be retained by the Provincial Treasurer until they are produced in court proceedings, the Provincial Treasurer shall (

a) within 120 days from the date of seizure, or (

b) if within the period mentioned in clause (

a) an application is made under this subsection that is after the expiry of that time rejected, then forthwith on disposition of the application return the documents, books, records, papers or things to the person from whom they were seized.

(2) The Provincial Treasurer may apply ex parte to retain the documents, books, records, papers or things seized and that application may be sup ported by evidence on oath establishing that the Provincial Treasurer has reasonable and probable grounds to believe that there has been a contra vention of this Act or a regulation and that the seized documents, books, records, papers or things are or may be required as evidence.

(3) The Provincial Treasurer may, for any purpose related to the admin istration or enforcement of this Act, require, by certified mail, registered letter or by a demand served personally, from any person (

a) any information or additional information, including a return of income or a supplementary return, or 28 Explanatory Notes

(2) If, on an ex parte application by the Provincial Treasurer, a judge is satisfied by information on oath that (

a) there are reasonable grounds to beUeve that there are in any premises or place other than a dwelling-house books, records, documents or property described in subsection (l)(

a) to (c), and (

b) entry into the premises or place is necessary for the administration of this Act, he may issue a wartant authorizing an authorized person named in the wartant to enter the premises or place and to exercise any of the powers referted to in subsection (1), subject to the condi tions specified in the wartant.

(3) If the premises or place referted to in subsection (l)(

d) is a dwelling-house, an authorized person may not enter that dwell ing-house without the consent of the occupant except under the authority of a wartant under subsection (4).

(4) If, on ex parte application by the Provincial Treasurer, a judge is satisfied by information on oath (

a) that there are reasonable grounds to believe that a dwell ing-house is the premises or a place referted to in subsection (l)(d), (

b) that entry into the dwelling-house is necessary for any purpose relating to the administration of this Act, and (

c) that entry into the dwelling-house has been refused or that there are reasonable grounds to believe that entry into it wiU be refused, he shaU issue a wartant authorizing an authorized person named in the warrant to enter that dwelling-house subject to the condi tions specified in the warrant but, if the judge is not satisfied that entry into that dwelling-house is necessary for any purpose relat ing to the administration of this Act, he shall (

d) order the occupant of the dweUing-house to provide rea sonable access to the authorized person to any document or property that is or should be kept in the dweUing-house, and (

e) make any other order that is appropriate in the circum stances to carry out the purposes of this Act to the extent that access has been or may be expected to be refused and that the document or property is or may be expected to be kept in the dweUing-house.

(5) In executing a wartant issued under this section, the author ized person named in the wartant shaU not use force unless he is accompanied by a peace officer and the use of force has been specificaUy authorized in the wartant. 64(1) Notwithstanding any other provision of this Act, the Prov incial Treasurer may, subject to subsection (4), for any purpose related to the administration of this Act, by notice served person- aUy or by registered or certified maU, demand that a corporation 29

(

b) production, or production on oath, of any books, letters, accounts, invoices, statement, financial or otherwise, or other documents within any reasonable time stipulated in the letter or demand. 64(1) If the Provincial Treasurer has reasonable and probable grounds to believe that a contravention of this Act or a regulation has been committed or is likely to be committed, he may make an ex parte application to a judge of the court and with the approval of the judge authorize in writing any officer of the Treasury Department together with any members of the Royal Canadian Mounted Police or other peace officers as he calls on to assist him and any other persons that may be named in the application to enter and search, if necessary by force, any building, receptacle or place in Alberta for documents, books, records, papers or things that may afford evidence as to the contravention of any provision of this Act or a regulation and to seize and take away any documents, books, records, papers or things and retain them until they are produced in any court proceedings.

(2) An application under subsection (1) shall be supported by evidence on oath establishing the facts on which the application is based. 65 Any person whose documents, books, records, papers or things are seized pursuant to

section 62(

d) or 64(1) or that person's authorized rep resentative may, at ad reasonable times and subject to any reasonable conditions that may be determined by the Provincial Treasurer, inspect the seized documents, books, records, papers or things and obtain copies at his own expense. 29 Explanatory Notes

or any other person provide or produce, within the reasonable period of time stipulated in the notice, (

a) any information or additional information, including a retum under

section 36 or a supplementary return, or (

b) any document.

(2) If a person is served with a notice to provide or produce information or documents under subsection (1) and he does not provide or produce the information or documents in accordance with the notice, the Provincial Treasurer, on 2 days' notice to the person, may apply to a judge and the judge may order the person to provide or produce the information or documents, subject to the conditions the judge considers appropriate, if he is satisfied that (

a) the information or documents are in the possession of or imder the control of the person, and (

b) the information or documents are relevant to the admin istration of this Act.

(3) The Provincial Treasurer shall not demand under subsection (1) that any person, in this

section referted to as a "third party" provide or produce information or a document relating to 1 or more unnamed persons unless he first obtains the authorization of a judge under subsection (4).

(4) On ex parte apphcation by the Provincial Treasurer, a judge may, subject to the conditions he considers appropriate, author ize the Provincial Treasurer to demand under subsection (1) that a third party provide or produce information or documents re lating to 1 or more unnamed persons, in this

section referted to as the "group", if the judge is satisfied by information on oath that (

a) the group is ascertainable, (

b) the information or documents are required to verify com pliance by the person or persons in the group with any duty or obligation under this Act, (

c) it is reasonable to expect, based on any grounds, including information, statistical or otherwise, or past experience relat ing to the group or any other persons, that any person in the group may have failed or may be likely to faU to provide or produce the information or documents that are sought pur suant to the demand or to comply with this Act otherwise, and (

d) the information or documents are not more readily avaU- able otherwise.

(5) If an authorization is granted under subsection (4), the au thorization shaU be served with the notice referted to in subsec tion (1).

(6) If an authorization is granted under subsection (4), a third party on whom a notice is served under subsection (1) may, within 15 days after the service of the notice, apply to a judge for a review of the authorization. 30

^ Explanatory Notes

(7) On hearing an apphcation under subsection (6), a judge may cancel the authorization previously granted if he is not then sat isfied that the conditions in subsection (4)(

a) to (

d) have been met, and he may confirm or vary the authorization if he is sat isfied that those conditions have been met.

(8) If information or documents are produced by a person under subsection (1) or (2), an authorized person, on giving a receipt for them, may remove the information or documents for the purpose of making copies of or extracts from them. 65(1) A judge may, on ex parte application by the Provincial Treasurer, issue a wartant in writing authorizing any person named in the wartant to enter and search any building, receptacle or place for any document or thing that may afford evidence as to the commission of an offence under this Act and to seize and, as soon as practicable, bring the document or thing before, or make a report in respect of it to, a judge, who shall deal with it in accordance with this section.

(2) An application under subsection (1) shall be supported by information on oath establishing the facts on which the applica tion is based.

(3) A judge shall issue the wartant referted to in subsection (1) if he is satisfied that there are reasonable grounds to believe that (

a) an offence under this Act has been committed, (

b) a document or thing that may afford evidence of the com mission of the offence is likely to be found, and (

c) the building, receptacle or place specified in the applica tion is likely to contain such a document or thing.

(4) A wartant issued under subsection (1) shaU refer to the of fence for which it is issued, shall identify the building, receptacle or place to be searched and the person aUeged to have committed the offence and shall be reasonably specific as to the document or thing to be searched for and seized.

(5) Any person who executes a warrant under subsection (1) may seize, in addition to the document or thing referred to in subsec tion (1), any other document or thing that he believes on reason able grounds affords evidence of the commission of an offence under this Act and shall as soon as practicable bring the docu ment or thing before, or make a report in respect of it to, a judge, who shall deal with it in accordance with this section.

(6) Subject to subsection (7), if any document or thing seized under subsection (1) or (5) is brought before a judge or a report in respect of it is made to a judge, the judge shall, unless the Provincial Treasurer waives retention, order that it be retained by the Provincial Treasurer, who shaU take reasonable care to ensure that it is preserved until the conclusion of any investiga tion into the offence in relation to which the document or thing was seized or untU it is required to be produced for the purposes of a criminal proceeding. 31

31 ** ' Explanatory Notes

(7) If any document or thing seized under subsection (1) or (5) is brought before a judge or a report in respect of it is made to a judge, the judge may, of his own motion or on

summary appli cation by a person with an interest in the document or thing, on 3 clear days' notice of the application to the Deputy Attomey General, order that the document or thing be retumed to the person from whom it was seized or to the person who is other wise legally entitled to it, if the judge is satisfied that the docu ment or thing (

a) will not be required for an investigation or a criminal proceeding, or (

b) was not seized in accordance with the wartant or this section.

(8) The person from whom a document or thing is seized pur suant to this

section is entitled, at all reasonable times and subject to any reasonable conditions that are imposed by the Provincial Treasurer, to inspect the document or thing and to obtain 1 copy of the document at the expense of the Provincial Treasurer 30

Section 67(1) is amended by striking out "sections 62, 63 and 64" and substituting "sections 63 to 65". 31

Section 69(1) is repealed. 32

Section 76(1) is amended by striking out "fumish information" and substituting "to provide or produce information or a document". 33

Section 84(1) is amended (

a) by striking out "notice of assessment" and substituting "no tice"; (

b) by adding ", 47(2.2) or 60.2(1)" after "43(1)". 34(1)

Section ll(l)(

a) of the Alberta Corporate Income Tax Amend ment Act, 1984,

chapter 3 of the Statutes of Alberta, 1984, is repealed and the following is substituted: (

a) by repealing subsection (1) and substituting the following: 39(1) If at any time after the day on or before which a return of a corporation was required under

section 36 to be filed for a taxation year, (

a) the amount of its tax payable for the year exceeds (

b) the aggregate of all amounts each of which is an amount paid at or before that time on account of tax 32

Section 67(1) presently reads: 67(1) If any document, book, record, paper or other document has been seized, examined or produced under sections 62, 63 and 64, the person by whom it is seized or examined or to whom it is produced or any officer of the Treasury Department may make, or cause to be made, one or more copies. 31

Section 69(1) presently reads: 69(1) A person authorized by the Provincial Treasurer may administer or receive an oath, affirmation or statutory declaration required to be given by or pursuant to sections 62 to 67. 32

Section 76(1) presently reads: 76(1) A person who fails to file a return or furnish information as and when required by this Act or the regulations is guilty of an offence. 33

Section 84(1) presently reads: 84(1) For the purposes of this Act the day of mailing of any notice of assessment or notification described in

section 43(1) shall, in the absence of any evidence to the contrary, be deemed to be the day appearing from that notice or notification to be the date thereof. 34

Section ll(l)(

a) of the Alberta Corporate Income Tax Amendment Act, 1984, presently reads: 11(1)

Section 39 is amended (

a) by repealing subsection (1) and substituting the following: 39(1) If, at any time after the day on or before which a return of a corporation was required to beftled under

section 36 for a tax ation year, (

a) the amount of tax payable for the year exceeds (

b) the aggregate of ad amounts each of which is an amount paid at or before that time on account of tax payable and 32 Explanatory Notes

payable and applied as at that time by the Provincial Treasurer against the corporation's liability for an amount payable for the year, the corporation liable to pay the tax shall pay to the Provin cial Treasurer interest at the prescribed rate on the excess computed for the period during which that excess is outstand ing. (2) Subsection (1) applies after April 19, 1983. 33

applied as at that time by the Provincial Treasurer against the corporation's liability for an amount payable for the year, the corporation liable to pay the tax shad pay interest on that excess for the period after April 19, 1983 during which it is out standing at the prescribed rates per year that are in effect from time to time during the period. 33 Explanatory Notes Title: 1986 (21st, 1st) Bill 45, Alberta Corporate Income Tax Amendment Act, 1986

Document details

Collection	Alberta — Bills
Citation	L21 S1 3231
Type	bill
Volume / chapter	L21 S1 3231
Language	en
Format	json
Source	PROVINCIAL
Identifier	471388acaa52dd055abb7727ea88709f087be1b3

Source file is stored in the law ingest library (json).