Income Tax Act — I-3.3 13
articular time and for the purposes of paragraph 13(7)(b) and subparagraph 13(7)(d)(i), the cost of the property to the taxpayer shall be deemed to be the same amount, and (iii) where the cost or capital cost, as the case may be, of the property to the transferor immediately before the transferor disposed of it exceeds the capital cost of the property to the taxpayer at that time determined without reference to this paragraph, the capital cost of the property to the taxpayer at that time shall be deemed to be the amount that was the cost or capital cost, as the case may be, of the property to the transferor immediately before the transferor disposed of it and the excess shall be deemed to have been allowed to the taxpayer in respect of the property under regulations made under paragraph 20(1)(a) in computing the taxpayer’s income for taxation years ending before the acquisition of the property by the taxpayer; (e.1) where a taxpayer is deemed by paragraph 110.6(19)(a) to have disposed of and reacquired a property that immediately before the disposition was a depreciable property, the taxpayer shall be deemed to have acquired the property from himself, herself or itself and, in so having acquired the property, not to have been dealing with himself, herself or itself at arm’s length; (f) if a taxpayer is deemed under paragraph 111(4)(e) to have disposed of and reacquired depreciable property (other than a timber resource property), the capital cost to the taxpayer of the property at the time of the reacquisition is deemed to be equal to the total of (i) the capital cost to the taxpayer of the property at the time of the disposition, and (ii) 1/2 of the amount, if any, by which the taxpayer’s proceeds of disposition of the property exceed the capital cost to the taxpayer of the property at the time of the disposition; (g) where the cost to a taxpayer of a passenger vehicle exceeds $20,000 or such other amount as is prescribed, the capital cost to the taxpayer of the vehicle shall be deemed to be $20,000 or that other prescribed amount, as the case may be; (h) notwithstanding paragraph 13(7)(g), where a passenger vehicle is acquired by a taxpayer at any time from a person with whom the taxpayer does not deal at arm’s length, the capital cost at that time to the taxpayer of the vehicle shall be deemed to be the least of (i) the fair market value of the vehicle at that time, (ii) the amount that immediately before that time was the cost amount to that person of the vehicle, and (iii) $20,000 or such other amount as is prescribed; and (i) if the cost to a taxpayer of a zero-emission passenger vehicle exceeds the prescribed amount in subsection 7307(1.1) of the Income Tax Regulations , or if the cost of a passenger vehicle that was, at any time, designated immediate expensing property as defined in subsection 1104(3.1) of the Income Tax Regulations exceeds the prescribed amount in subsection 7307(1) of the Income Tax Regulations , (i) the capital cost to the taxpayer of the vehicle is deemed to be equal to the prescribed amount under subsection 7307(1) or (1.1), as the case may be, and (ii) for the purposes of paragraph (a) of the description of F in the definition undepreciated capital cost in subsection (21), the proceeds of disposition of the vehicle are deemed to be the amount determined by the formula A × B/C where A is the amount that would, in the absence of this subparagraph, be the proceeds of disposition of the vehicle, B is (A) if the vehicle is disposed of to a person or partnership with which the taxpayer deals at arm’s length, the capital cost to the taxpayer of the vehicle, and (B) in any other case, the amount determined for C, and C is the amount determined by the formula D + (E + F) − (G + H) where D is the cost to the taxpayer of the vehicle, E is the amount determined under paragraph (7.1)(d) in respect of the vehicle at the time of disposition, F is the maximum amount determined for C in the definition undepreciat