Income Tax Regulations — 1100
his paragraph for the year) of property included in Class 10 in Schedule II; and Additional Allowance — Year 2000 Computer Software (zh) where the taxpayer (i) has elected for the year in prescribed manner, (ii) was not in the year a large corporation, as defined in subsection 225.1(8) of the Act, or a partnership any member of which was such a corporation in a taxation year that included any time that is in the partnership’s year, and (iii) acquired property included in paragraph (o) of Class 12 in Schedule II (A) in the year, (B) after 1997 and before November 1999, and (C) for the purpose of replacing property that was acquired before 1998 that has a material risk of malfunctioning because of the change of the calendar year to 2000 and that is described in paragraph (f) of Class 10, or paragraph (o) of Class 12, in Schedule II, such additional amount as the taxpayer claims in respect of all property described in subparagraph (iii) not exceeding the least of (iv) the amount, if any, by which $50,000 exceeds the total of (A) the total of all amounts each of which is an amount claimed by the taxpayer under this paragraph for a preceding taxation year, (B) the total of all amounts each of which is an amount claimed by the taxpayer for the year or a preceding taxation year under paragraph (zg), and (C) the total of all amounts each of which is an amount claimed under this paragraph or paragraph (zg) by a corporation for a taxation year in which it was associated with the taxpayer, (v) 50% of the capital cost to the taxpayer of all property described in subparagraph (iii), and (vi) the undepreciated capital cost to the taxpayer as of the end of the year (computed without reference to subsection (2) and after making all deductions claimed under other provisions of this subsection for the year but before making any deduction under this paragraph for the year) of property included in Class 12 in Schedule II. (1.1) Despite subsections (0.1), (1) and (3), the amount deductible by a taxpayer for a taxation year in respect of a property that is a specified leasing property at the end of the year is the lesser of (a) the amount, if any, by which the aggregate of (i) all amounts that would be considered to be repayments in the year or a preceding year on account of the principal amount of a loan made by the taxpayer if (A) the taxpayer had made the loan at the time that the property last became a specified leasing property and in a principal amount equal to the fair market value of the property at that time, (B) interest had been charged on the principal amount of the loan outstanding from time to time at the rate, determined in accordance with section 4302, in effect at the earlier of (I) the time, if any, before the time referred to in subclause (II), at which the taxpayer last entered into an agreement to lease the property, and (II) the time that the property last became a specified leasing property (or, where a particular lease provides that the amount paid or payable by the lessee of the property for the use of, or the right to use, the property varies according to prevailing interest rates in effect from time to time, and the taxpayer so elects, in respect of all of the property that is the subject of the particular lease, in the taxpayer’s return of income under Part I of the Act for the taxation year of the taxpayer in which the particular lease was entered into, the rate determined in accordance with section 4302 that is in effect at the beginning of the period for which the interest is being calculated), compounded semi-annually not in advance, and (C) the amounts that were received or receivable by the taxpayer before the end of the year for the use of, or the right to use, the property before the end of the year and after the time it last became a specified leasing property were blended payments of principal and interest, calculated in accordance with clause (B), on the loan applied firstly on account of interest on principal