British Columbia Order in Council — Order under International Financial Business (Tax Refund) B (O.C. 501/2000)

O.C. 501/2000

British Columbia — Orders in Council

PROVINCE OF BRITISH COLUMBIA ORDER OF THE LIEUTENANT GOVERNOR IN COUNCIL Order in Council No. — 501 , Approved and Ordered MAR 3 0 2000 Executive Council Chambers, Victoria Administrator On the recommendation of the undersigned, the LiiiiMIECroWAIIK by and with the advice and consent of the Executive Council, orders that the International Financial Business (Tax Refund) Regulation, B.C. Reg. 440/88, be amended in accordance with the attached Schedule, effective April 1, 2000. Minister ofire alance and Corporate Relations Presiding • r -10111rdWfftbouncil (This

part is for administrative purposes only and is not part of the Order.) Authority under which Order is made: Act and section:- International Financial Business (Tax Refund) Act, sections 5 and 23 Other (specify):- OIC 2010/88 March 23, 2000 520/2000/7

SCHEDULE 1

Section 12 of the International Financial Business (Tax Refund) Regulation, B.C. Reg. 440/88, is repealed and the following substituted: Tax refund amount — registered financial institution 12 In this section: "adjusted IFB income" means, in relation to a registered financial institution for a taxation year, the positive or negative amount determined in accordance with the following formula: IFBI — AF where IFBI = the IFB taxable income of the financial institution for the taxation year; AF = the greater of (

a) zero, and (

b) the amount determined in accordance with the following formula: (0.65 x interest revenue) — interest expense; "adjusted small business income" means, in relation to a registered financial institution for a taxation year, whichever of the following is applicable: (

a) if its federal taxable income for the taxation year is zero, zero; (

b) if paragraph (

a) does not apply, the positive or negative amount determined in accordance with the following formula: (AI FTI) x SBA where Al = the adjusted IFB income for the taxation year; FTI = the financial institution's federal taxable income for the taxation year; SBA = the amount that is subject to the small business deduction under

section 125 (1) of the Income Tax Act (Canada) for the taxation year; "cumulative IFB tax" means the aggregate of IFB tax for the taxation year and IFB tax for all preceding taxation years; I of 3

"federal taxable income" in, ins, in relation to a registered financial institution for a taxation year, its taxable income for the taxation year calculated in accordance with the Income Tax Act (Canada); "IFB tax" means, in relation to a registered financial institution for a taxation year, whichever of the following is applicable: (

a) if its federal taxable income for the taxation year is zero, zero; (

b) if the amount calculated for the taxation year under paragraph (

c) or (d), as applicable, is negative, zero; (

c) if neither paragraph (

a) or (

b) applies, in the case of a taxation year that begins before April 1, 2000, the amount determined in accordance with the following formula: Al x CTR where AI = the adjusted IFB income for the taxation year; CTR = the percentage established by

section 14 (2) [corporate tax rate] of the Income Tax Act for the taxation year; (

d) if neither paragraph (

a) or (

b) applies, in the case of a taxation year that begins on or after April 1, 2000, (

i) for a registere" financial institution that is not eligible to claim the small busiiis deduction under

section 125 of the Income Tax Act (Canada) for the taxation year, the amount determined in accordance with the formula under paragraph (c), and (ii) for a registered financial institution that is eligible to claim the small business deduction under

section 125 of the Income Tax Act (Canada) for the taxation year, the amount detennined in accordance with the following formula: (ASBI x SBTR)+ [(Al - ASBI) x CTR] where ASBI = the adjusted small business income for the taxation year; SBTR = the percentage established by

section 16 (1) (a) [small business tax rate] of the Income Tax Act for the taxation year; Al = the adjusted IFB income for the taxation year; CTR = the percentage established by

section 14 (2) [corporate tax rate] of the Income Tax Act for the taxation year; "IFB taxable income" means, in relation to a registered financial institution for a taxation year, (

a) the amount of its federal taxable income for the taxation year 2 of 3

less (

b) the amount that would be its federal taxable income for the taxation year if income or loss from operations of the registered financial institution's international financial business in British Columbia were excluded in determining that amount; "interest expense" means the amount of interest expense for the applicable taxation year shown on the financial statements of the registered financial institution's international financial business; "interest revenue" means the amount of interest revenue for the applicable taxation year shown on the financial statements of the registered financial institution's international financial business.

(2) For the purposes of this section, IFB tax is deemed to be zero for all taxation years before registration of the financial institution under the Act.

(3) For the purposes of paragraph (

b) of the definition of "IFB taxable income", the income or loss from the international financial business must be calculated in accordance with the Income Tax Act (Canada) and be derived from the financial statements required by

section 4.

(4) Subject to subsection (5), the tax refund amount payable to a financial institution with respect to a taxation year is the lesser of (

a) the amount by which the cumulative IFB tax for the taxation year exceeds the aggregate of IFI3 tax refund amounts paid or payable for all preceding taxation years, and (

b) the amount of tax assessed and paid under the Income Tax Act for the taxation year.

(5) The amount determined under subsection (4) is deemed to be zero if it would otherwise be negative.

(6) If income or loss from international banking activity is excluded from the calculation of taxable income under

section 33.1 of the Income Tax Act (Canada), the income or loss must also be excluded for the purposes of all calculations required by this section. 3 of 3

Document details

Collection	British Columbia — Orders in Council
Citation	O.C. 501/2000
Type	order_in_council
Volume / chapter	arc oic 0501 2000
Language	en
Format	pdf
Source	PROVINCIAL
Identifier	b0d1bbf02d5c4de44816981e70d464f77a978747

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