Income Tax Regulations — 8000
8000 For the purpose of clause 20(1)(l)(ii)(C) of the Act, the prescribed reserve amount for a taxation year means the aggregate of (a) where the taxpayer is a bank, an amount equal to the lesser of (i) the amount of the reserve reported in its annual report for the year that is filed with and accepted by the relevant authority or, where the taxpayer was throughout the year subject to the supervision of the relevant authority but was not required to file an annual report for the year with the relevant authority, in its financial statements for the year, as general provisions or as specific provisions, in respect of exposures to designated countries in respect of loans or lending assets of the taxpayer made or acquired by it in the ordinary course of its business, and (ii) an amount in respect of the loans or lending assets of the taxpayer at the end of the year that were made or acquired by the taxpayer in the ordinary course of its business and reported for the year by the taxpayer to the relevant authority, in accordance with the guidelines established by the relevant authority, as part of the taxpayer’s total exposure to designated countries for the purposes of determining the taxpayer’s general provisions or specific provisions referred to in subparagraph (i) or that were acquired by the taxpayer after August 16, 1990 and reported for the year by the taxpayer to the relevant authority, in accordance with the guidelines established by the relevant authority, as an exposure to a designated country (in this subparagraph referred to as the “loans”) equal to the positive or negative amount, as the case may be, determined by the formula 45% (A + B) - (B + C) where A is the aggregate of all amounts each of which is the amount that would be the amortized cost of a loan to the taxpayer at the end of the year if the definition amortized cost in section 248 of the Act were read without reference to paragraphs (e) and (i) thereof, B is the aggregate of all amounts each of which is the amount, if any, by which the principal amount of a loan outstanding at the time it was acquired by the taxpayer exceeds the amortized cost of the loan to the taxpayer immediately after the time it was acquired by the taxpayer, and C is the aggregate of all amounts each of which is (A) an amount deducted in respect of a loan under clause 20(1)(l)(ii)(B) of the Act in computing the taxpayer’s income for the year, or (B) an amount in respect of a loan determined as the amount, if any, by which (I) the aggregate of all amounts in respect of the loan deducted under paragraph 20(1)(p) of the Act in computing the taxpayer’s income for the year or a preceding taxation year exceeds (II) the aggregate of all amounts in respect of the loan included under paragraph 12(1)(i) of the Act in computing the taxpayer’s income for the year or a preceding taxation year, and (a.1) where the taxpayer is a bank, the positive or negative amount that would be determined under the formula in subparagraph (a)(ii) in respect of the specified loans owned by the taxpayer at the end of the year if that subparagraph applied to those loans. (b) [Repealed, SOR/99-91, s. 2] [NOTE: Application provisions are not included in the consolidated text; see relevant amending Acts and regulations.] SOR/91-78, s. 4; SOR/92-681, s. 3(F); SOR/94-686, s. 40(F); SOR/99-91, s. 2