Income Tax Act — I-3.3 44
 under subsection 44(1), the taxpayer shall be deemed to have elected in respect thereof under subsection 13(4); and (b) if the taxpayer has elected in respect of that property under subsection 13(4), the taxpayer shall be deemed to have elected in respect thereof under subsection 44(1). Replacement property (5) For the purposes of this section, a particular capital property of a taxpayer is a replacement property for a former property of the taxpayer, if (a) it is reasonable to conclude that the property was acquired by the taxpayer to replace the former property; (a.1) it was acquired by the taxpayer and used by the taxpayer or a person related to the taxpayer for a use that is the same as or similar to the use to which the taxpayer or a person related to the taxpayer put the former property; (b) where the former property was used by the taxpayer or a person related to the taxpayer for the purpose of gaining or producing income from a business, the particular capital property was acquired for the purpose of gaining or producing income from that or a similar business or for use by a person related to the taxpayer for such a purpose; (c) where the former property was a taxable Canadian property of the taxpayer, the particular capital property is a taxable Canadian property of the taxpayer; and (d) where the former property was a taxable Canadian property (other than treaty-protected property) of the taxpayer, the particular capital property is a taxable Canadian property (other than treaty-protected property) of the taxpayer. Deemed proceeds of disposition (6) If a taxpayer has disposed of property that was a former business property and was in part a building and in part the land (or an interest, or for civil law a right, therein) subjacent to, or immediately contiguous to and necessary for the use of, the building, for the purposes of this Subdivision, the amount if any, by which (a) the proceeds of disposition of one such part determined without regard to this subsection exceed (b) the adjusted cost base to the taxpayer of that part shall, to the extent that the taxpayer so elects in the taxpayer’s return of income under this Part for the year in which the taxpayer acquired a replacement property for the former business property, be deemed not to be proceeds of disposition of that part and to be proceeds of disposition of the other part. Where subpara. (1)(e)(iii) does not apply (7) Subparagraph 44(1)(e)(iii) does not apply to permit a taxpayer to claim any amount under that subparagraph in computing a gain for a taxation year where (a) the taxpayer, at the end of the year or at any time in the immediately following year, was not resident in Canada or was exempt from tax under any provision of this Part; (b) the person to whom the former property of the taxpayer was disposed of was a corporation that, immediately after the disposition, (i) was controlled, directly or indirectly in any manner whatever, by the taxpayer, (ii) was controlled, directly or indirectly in any manner whatever, by a person or group of persons by whom the taxpayer was controlled, directly or indirectly in any manner whatever, or (iii) controlled the taxpayer, directly or indirectly in any manner whatever, where the taxpayer is a corporation; or (c) the former property of the taxpayer was disposed of to a partnership in which the taxpayer was, immediately after the disposition, a majority-interest partner. Application of s. 70(10) (8) The definitions in subsection 70(10) apply to this section. [NOTE: Application provisions are not included in the consolidated text; see relevant amending Acts and regulations.] R.S., 1985, c. 1 (5th Supp.), s. 44; 1994, c. 7, Sch. II, s. 24, c. 21, s. 17; 1995, c. 21, s. 12; 1998, c. 19, s. 90; 1999, c. 22, s. 12; 2001, c. 17, s. 28; 2007, c. 2, s. 5; 2013, c. 34, ss. 104, 186, c. 40, s. 20(E) 2023, c. 26, s. 9(F) 2024, c. 17, s. 8