Income Tax Act — I-3.3 204.82
losses in respect of its eligible investments shall not be taken into account in computing the amount of the shareholders’ equity in the corporation; (b) where (i) the relevant year ends after 1998, and (ii) it is expected that a redemption of its Class A shares will occur after the end of a particular taxation year and, as a consequence, the amount of the shareholders’ equity in the corporation at the end of the particular year would otherwise be reduced to take into account the expected redemption, subject to paragraph 204.82(2.2)(c), the amount (or, where the relevant year ends in 1999, 2000, 2001 or 2002, 20%, 40%, 60% or 80%, respectively of the amount) expected to be redeemed shall not be taken into account in determining the amount of the shareholders’ equity in the corporation at the end of the particular year; (c) paragraph 204.82(2.2)(b) does not apply to a redemption expected to be made after the end of a taxation year where (i) the redemption is made within 60 days after the end of the year, and (ii) either (A) tax under Part XII.5 became payable as a consequence of the redemption, or (B) tax under Part XII.5 would not have become payable as a consequence of the redemption if the redemption had occurred at the end of the year; (c.1) the specified adjustment in respect of shareholders’ equity in the corporation at the end of a taxation year is the amount determined by the formula (A × (B/C)) - D where A is the shareholders’ equity at the end of the year, B is the total of (i) the fair market value at the end of the year of all Class A shares issued by it before March 6, 1996 and more than five years before the end of the year, (ii) the fair market value at the end of the year of all Class A shares issued by it after March 5, 1996 and more than eight years before the end of the year, (iii) the fair market value at the end of the year of all Class A shares issued by it in the last 60 days of the year, and (iv) if the corporation so elects in writing filed with the Minister not more than six months after the end of the year and is not a revoked corporation at the end of the year, the fair market value at the end of the year of all shares of classes, of the capital stock of the corporation, to which clause 204.81(1)(c)(ii)(C) applies, C is the fair market value at the end of the year of all shares issued by it, and D is the amount by which the shareholders’ equity in the corporation at the end of the year has been reduced to take into account the expected subsequent redemption of shares of the capital stock of the corporation; and (d) the adjusted cost to the corporation of an eligible investment of the corporation at any time is (i) 150% of the cost to the corporation of the eligible investment at that time where the eligible investment is (A) a property acquired by the corporation after February 18, 1997 (other than a property to which subparagraph (i.1) applies) that would be an eligible investment of the corporation if the reference to “$50,000,000” in paragraph (f) of the definition eligible investment in subsection 204.8(1) were read as “$10,000,000”, or (B) a share of the capital stock of a prescribed corporation, (i.1) 200% of the cost to the corporation of the eligible investment at that time where the eligible investment is a property acquired by the corporation after February 16, 1999 (other than a property described in clause (i)(B)) that would be an eligible investment of the corporation if the reference to “$50,000,000” in paragraph (f) of the definition eligible investment in subsection 204.8(1) were read as “$2,500,000”, and (ii) in any other case, the cost to the corporation of the eligible investment of the corporation at that time. Recovery of credit (3) Where a corporation is liable under subsection 204.82(2) to pay a tax in respect of 12 consecutive months (in this subsection referred to as the “particular period”), the corporation shall pay a tax under this Part for a taxation year in respect of ea