Petroleum and Gas Revenue Tax Act — P-12 10
Credit deductions 10 (1) Where a taxpayer is a corporation, there may be deducted from the tax otherwise payable (computed without reference to subsections (7) and 9(5)) by it on its production revenue for a taxation year, an amount equal to the aggregate of (a) the lesser of (i) the tax that would otherwise be payable by the corporation under this Part on its production revenue for the year if the reference to “production revenue” in section 9 were read as “eligible production revenue”, and (ii) the corporation’s credit limit for the taxation year, (b) in respect of the taxation year of the corporation that ends in 1985, the lesser of (i) the amount of tax determined under subparagraph (a)(i) for the year that may reasonably be attributed to the eligible production revenue for the period in the year commencing after December 31, 1984, and (ii) that proportion of the corporation’s allocated limit for the year that the number of days after December 31, 1984 in the year is of three hundred and sixty-five, and (c) in respect of the taxation years of the corporation that end after 1985, the least of (i) the amount of tax determined under subparagraph (a)(i) for the year on that portion of its eligible production revenue for the year that may reasonably be attributed to production in the period in the year commencing May 1, 1986, (ii) three times that proportion of the corporation’s allocated limit for the year that the number of days after April 1986 and before October 1986 in the year is of three hundred and sixty-five, and (iii) the amount, if any, by which the tax determined under subparagraph (a)(i) for the year exceeds the amount determined under paragraph (a) for the year. Definition of “credit limit” (2) For the purposes of subsection (1), the credit limit of a corporation for a taxation year is that proportion of the corporation’s allocated limit for the year that the number of days before October 1986 in the year is of three hundred and sixty-five. Definition of “allocated limit” (3) For the purposes of subsections (1) and (2), the allocated limit of a corporation for a taxation year in which the corporation (a) is not associated with one or more other corporations, is (i) two hundred and fifty thousand dollars where the year ends before 1986, or (ii) five hundred thousand dollars where the year ends after 1985; and (b) is associated with one or more other corporations, is the amount allocated to the corporation under subsection (4) or (5). Idem (4) The corporations in a group that, in a taxation year, are associated with each other may file with the Minister in prescribed form an agreement whereby, for the purpose of this section, they allocate an amount to one or more of them for the year, which amount or the aggregate of which amounts, as the case may be, is (a) two hundred and fifty thousand dollars for the year ending before 1986; or (b) five hundred thousand dollars for the year ending after 1985. Idem (5) If any of the corporations in a group referred to in subsection (4) fails to file with the Minister an agreement as contemplated by that subsection within thirty days after notice in writing by the Minister has been forwarded to any of them that such an agreement is required for the purpose of any assessment of tax for a taxation year under this Part, the Minister shall, for the purpose of this section, allocate an amount to one or more of them for the year, which amount or the aggregate of which amounts, as the case may be, is an amount referred to in paragraph (4)(a) or (b), as the case may be. Definition of “eligible production revenue” (6) For the purposes of this section, the eligible production revenue of a corporation for a taxation year is the aggregate of all amounts each of which is (a) the amount that would be the production revenue for the year of the corporation, other than an amount, if any, included therein by virtue of subsection 5(5) or (5.1) or by virtue of the corporation being a member of a par