Income Tax Application Rules — I-3.31 26
rst fiscal period ending after 1971, minus such part, if any, thereof as would, if the amount had been paid by the partnership in that fiscal period, have been deductible in computing its income for that fiscal period. ( masse fiscale ) Meaning of actual cost (13) For the purposes of this section, the actual cost to a person of any property means, except as expressly otherwise provided in this section, the amount, if any, by which (a) its cost to the person computed without regard to the provisions of this section exceeds (b) such part of that cost as was deductible in computing the person’s income for any taxation year ending before 1972. Idem (14) For the purposes of this section, the actual cost to a taxpayer, as of any particular time after 1971, of an interest in a partnership of which the taxpayer was a member on December 31, 1971 and thereafter without interruption until the particular time means the amount, if any, by which the total of (a) the cost to the taxpayer of the interest, computed as of the particular time without regard to the provisions of this section, (b) the total of all amounts each of which is an amount in respect of a fiscal period of the partnership that ended before 1972, equal to the total of (i) the amount that the taxpayer’s income from the partnership for the taxation year of the taxpayer in which the period ended would have been, if the former Act had been read without reference to subsection 83(5) of that Act, and (ii) the taxpayer’s share, determined at the end of the period, of all profits made from dispositions in the period of capital assets that were partnership property of the partnership, to the extent that those profits were not included in computing the income or loss, as the case may be, from the partnership, of any member thereof, (c) where the taxpayer had, before 1972, made a contribution of capital to the partnership otherwise than by way of loan, such part of the contribution as cannot reasonably be regarded as a gift made to, or for the benefit of, any other member of the partnership who was related to the taxpayer, and (d) where, by means of the partnership, the taxpayer carried on before 1972 a business that was a profession, the amount that the taxpayer’s 1971 receivables (within the meaning assigned by subsection 23(5)) in respect of the business would have been if, before 1972, the taxpayer had carried on no businesses except by means of the partnership, exceeds the total of (e) all amounts each of which is an amount in respect of the disposition by the taxpayer before the particular time of a part of the taxpayer’s interest in the partnership, equal to such portion of, (i) where the disposition was made before 1972, the actual cost to the taxpayer of the interest, and (ii) in any other case, the adjusted cost base to the taxpayer of the interest immediately before the disposition, as can reasonably be regarded as attributable to the part so disposed of, (f) all amounts each of which is an amount in respect of a fiscal period of the partnership that ended before 1972, equal to the total of (i) the amount that would have been the taxpayer’s loss from the partnership for the taxation year of the taxpayer in which the period ended if the former Act had been read without reference to subsection 83(5) of that Act, (ii) the taxpayer’s share, determined the end of the period, of all losses sustained from dispositions in the period of capital assets that were partnership property of the partnership, to the extent that those losses were not included in computing the loss or income, as the case may be, from the partnership of any member thereof, and (iii) the taxpayer’s share, determined at the end of the period, of such of the drilling and exploration expenses, including all general geological and geophysical expenses, incurred by the partnership while the taxpayer was a member thereof, on or in respect of exploring or drilling for petroleum or natural gas in Canada as were incurre