Income Tax Regulations — 2411
sses from the disposition of such of the property as is not capital property or a specified debt obligation (as defined in subsection 142.2(1) of the Act), (c) [Repealed, SOR/2009-222, s. 4] (d) all amounts that were or would be deductible in computing the insurer’s income for the year under paragraph 20(1)(a) of the Act in respect of the capital cost of the property or under paragraphs 20(1)(c) and (d) of the Act in respect of interest paid or payable on borrowed money used to acquire the property, (e) where any such property is rental property or leasing property (within the meaning assigned by subsections 1100(14) and (17), respectively), all amounts that were or would be deductible in computing the insurer’s income for the year in respect of expenses directly related to the earning of rental income derived from the property, (f) all amounts that were or would be deductible by the insurer in computing the insurer’s income for the year under paragraph 20(1)(l), (l.1) or (p) of the Act as a reserve or bad debt in respect of the property, (g) all amounts that were deducted or would be deductible in computing the insurer’s income for the year under section 66, 66.1, 66.2 or 66.4 of the Act in respect of the property, and (h) [Repealed, 2016, c. 12, s. 80] (i) all amounts that were or would be deductible in computing the insurer’s income for the year in respect of other expenses directly related to the earning of gross investment revenue derived from the property. (4.1) The positive or negative amount, as the case may be, determined under this subsection in respect of an insurer for a taxation year in respect of property disposed of by the insurer in the year or a preceding taxation year is the amount determined by the formula A - B where A is the total of the amounts included under paragraphs 142.4(4)(a) and (c) of the Act in the insurer’s income for the year in respect of the property, or that would be so included if the property were designated insurance property of the insurer in respect of an insurance business in Canada for each taxation year in which it was held by the insurer; and B is the total of the amounts deductible under paragraphs 142.4(4)(b) and (d) of the Act in respect of the property in computing the insurer’s income for the year, or that would be so deductible if the property were designated insurance property of the insurer in respect of an insurance business in Canada for each taxation year in which it was held by the insurer. (5) [Repealed, SOR/2009-222, s. 4] (6) For the purposes of subsection (1), the balance of an insurer’s cumulative excess account at the end of a taxation year shall be determined as the amount, if any, by which (a) the aggregate of all amounts each of which is a positive amount, if any, determined in respect of each of such of its seven immediately preceding taxation years that began after June 17, 1987 and ended after 1987 by the formula B - A where A and B are the amounts determined under subsection (1) in respect of the insurer for such immediately preceding taxation year, exceeds (b) the aggregate of all amounts each of which is an amount claimed by the insurer under subsection (1) in respect of its cumulative excess account for a preceding taxation year that can be attributed to a positive amount determined under paragraph (a) for that year and, for the purpose of this paragraph, a positive amount determined in respect of a taxation year shall be deemed to have been claimed before a positive amount determined in respect of any subsequent taxation year. (7) [Repealed, SOR/2000-413, s. 6] (8) For the purposes of this section, foreign investment property of an insurer means investment property of the insurer (unless the insurer is a non-resident insurer and it is established by the insurer that the investment property is not effectively connected with its Canadian insurance businesses) that is not Canadian investment property of the insurer. [NOTE: Application provisions are not inc