Income Tax Act — I-3.3 194
 be provided by a government, municipality or any other public authority in respect of, or for the acquisition of, that share. Computing paid-up capital after designation (4.1) Where a corporation has designated an amount under subsection 194(4) in respect of shares issued at any time after May 23, 1985, in computing, at any particular time after that time, the paid-up capital in respect of the class of shares of the capital stock of the corporation that includes those shares (a) there shall be deducted the amount, if any, by which (i) the increase as a result of the issue of those shares in the paid-up capital in respect of all shares of that class, determined without reference to this subsection as it applies to those shares, exceeds (ii) the amount, if any, by which the total amount of consideration for which those shares were issued exceeds 50% of the amount designated by the corporation under subsection 194(4) in respect of those shares; and (b) there shall be added an amount equal to the lesser of (i) the amount, if any, by which (A) the total of all amounts each of which is an amount deemed by subsection 84(3), 84(4) or 84(4.1) to be a dividend on shares of that class paid by the corporation after May 23, 1985 and before the particular time exceeds (B) the total that would be determined under clause 194(4.1)(b)(i)(A) if this Act were read without reference to paragraph 194(4.1)(a), and (ii) the total of all amounts each of which is an amount required by paragraph 194(4.1)(a) to be deducted in computing the paid-up capital in respect of that class of shares after May 23, 1985 and before the particular time. Where amount may not be designated (4.2) Notwithstanding subsection 194(4), no amount may be designated by a corporation in respect of (a) a share issued by the corporation after October 10, 1984, other than (i) a qualifying share issued before May 23, 1985, or (ii) a qualifying share issued after May 22, 1985 and before 1986 (A) under the terms of an agreement in writing entered into by the corporation before May 23, 1985, other than pursuant to an option to acquire the share if the option was not exercised before May 23, 1985, or (B) as part of a lawful distribution to the public in accordance with a prospectus, preliminary prospectus or registration statement filed before May 24, 1985 with a public authority in Canada pursuant to and in accordance with the securities legislation of Canada or of any province and, where required by law, accepted for filing by that public authority; (b) a share or debt obligation issued or a right granted by the corporation after October 10, 1984, other than a share or debt obligation issued or a right granted before 1986 (i) under the terms of an agreement in writing entered into by the corporation before October 11, 1984, other than pursuant to an option to acquire the share, debt obligation or right if the option was not exercised before October 11, 1984, or (ii) where arrangements, evidenced in writing, for the issue of the share or debt obligation or the granting of the right were substantially advanced before October 10, 1984; or (c) a share or debt obligation issued, or a right granted, at any time after June 15, 1984, by a corporation that was an excluded corporation (within the meaning assigned by subsection 127.1(2)) at that time. Presumption (5) For the purposes of this Act, the Part VIII refund of a corporation for a taxation year shall be deemed to be an amount paid on account of its tax under this Part for the year on the last day of the second month following the end of the year. Definition of scientific research and experimental development financing contract (6) In this Part, scientific research and experimental development financing contract means a contract in writing pursuant to which an amount is paid by a person to a corporation as consideration for the granting by the corporation to that person of any right, either absolute or contingent, to receive income, othe