Income Tax Act — I-3.3 80.2
e specified amount would, if this Act were read without reference to this subsection, have been paid, to have this subsection apply to the specified amount; and (g) the specified amount is paid before 2006. Inclusion in recipient’s income (6) The recipient shall include in computing the recipient’s income for the taxation year or fiscal period in which the original amount was paid or became payable or receivable, the amount, if any, by which the eligible portion of the specified amount exceeds the portion of the original amount that was included in computing the income of the recipient for the taxation year or fiscal period because of paragraph 12(1)(o) or that was not deductible in computing the income of the recipient for the taxation year or fiscal period because of paragraph 18(1)(m). Interpretation — portion of the original amount (7) For the purpose of subsection (6), the portion of the original amount that was included in computing the income of the recipient or that was not deductible in computing the income of the recipient is the amount that would be included in computing the income of the recipient under paragraph 12(1)(o) or that would not be deductible in computing the income of the recipient under paragraph 18(1)(m), if the original amount were equal to the eligible portion of the specified amount. Inclusion in recipient’s income (8) The recipient shall include, in computing the recipient’s income for its taxation year or fiscal period in which the original amount was paid or became payable or receivable, the amount, if any, by which the specified amount exceeds the eligible portion of the specified amount. Deduction by taxpayer (9) Subject to paragraphs 18(1)(a) and (b), the taxpayer may deduct in computing the taxpayer’s income for the taxpayer’s taxation year in which the specified amount was paid, the amount, if any, by which the specified amount exceeds the eligible portion of the specified amount. Specified amount deemed not to be payable or receivable (10) Except for the purposes of this section and subparagraph 53(1)(e)(iv.1), (a) the taxpayer is deemed not to have paid, and not to have been obligated to pay, the specified amount; and (b) the recipient is deemed not to have received, and not to have been entitled to receive, the specified amount. Eligible portion of a specified amount (11) The eligible portion of a specified amount is (a) an amount equal to the specified amount if (i) the specified amount was paid before September 17, 2004, (ii) the original amount is a tax imposed under a provincial law on the production of (A) petroleum, natural gas or related hydrocarbons from a natural accumulation of petroleum or natural gas (other than a mineral resource) located in Canada, or from an oil or gas well located in Canada if the petroleum, natural gas or related hydrocarbons are not, before extraction, owned by the Crown in right of Canada or a province, or (B) metals, minerals or coal from a mineral resource located in Canada if the metals, minerals or coal are not, before extraction, owned by the Crown in right of Canada or a province, (iii) the specified amount does not exceed the taxpayer’s share of the original amount, or (iv) the original amount is a prescribed amount; and (b) the taxpayer’s share of the original amount, in any other case. Taxpayer’s share of original amount (12) A taxpayer’s share of an original amount in respect of a specified amount paid by the taxpayer to a recipient in respect of a property is the amount that may reasonably be considered to be the taxpayer’s share of the total of all amounts described in paragraph 12(1)(o) or 18(1)(m) in respect of the property, which share may not exceed the total of (a) that proportion of the total of all amounts described in paragraph 12(1)(o) or 18(1)(m) in respect of the property that the taxpayer’s share of production from the property payable to the taxpayer as a royalty, which royalty is computed without reference to the costs of expl