5.2 (1) Except as otherwise provided in this section, if a corporation deducts or claims an amount under a provision of this Act, or of the Income Tax Act
(Canada) as it applies for the purposes of this Act, that is less than the maximum amount the corporation may deduct or claim in determining its income or taxable income for the taxation year, or fails to deduct or claim any amount under the provision for the taxation year, the corporation shall be deemed to deduct or claim an amount under the provision in determining its income or taxable income, as the case may be, for the taxation year, in addition to the amount, if any, that it has deducted or claimed under the provision, equal to the amount, if any, by which the lesser of “A” and “B” exceeds “C”, where, “A” is the greatest amount that may be deducted or claimed by the corporation under the provision in determining its income or taxable income under this Act for the taxation year, “B” is the greatest of the amounts deducted or claimed by the corporation under the corresponding provisions of the laws of other provinces in computing its income or taxable income for the taxation year under the laws of the other provinces, and “C” is the amount, if any, that the corporation deducted or claimed under the provision for the taxation year before the application of this subsection.  1998, c. 34, s. 27 (1); 1999, c. 9, s. 73 (1); 2004, c. 16, s. 2 (2). Exception (1.1) Subsection (1) does not apply if the corporation deducted or claimed the amount, or failed to deduct or claim the amount, primarily for purposes other than a reduction in the total amount of income tax payable to one or more provinces over the course of one or more taxation years.  1999, c. 9, s. 73 (2); 2004, c. 16, s. 2 (2). Same (2) Subsection (1) does not apply to a corporation for a taxation year unless the following conditions are satisfied: 1. The corporation’s Ontario allocation factor for a subsequent taxation year, within the meaning of subsection 12 (1), is at least 20 per cent greater than the corporation’s Ontario allocation factor for the taxation year. 2. The amount that would be the corporation’s income or taxable income for the taxation year, determined under this Act before the deduction of any amount deemed by subsection (1) to be deducted or claimed under the provision referred to in that subsection, is greater than the corporation’s income or taxable income, as the case may be, for the taxation year determined under the law of a province other than Ontario because the corporation deducted or claimed a greater amount in determining its income or taxable income under the corresponding provision of the law of the other province. 3. The total amount of all income tax that would be payable by the corporation to one or more provinces for all taxation years commencing with the taxation year and ending with the subsequent taxation year, determined before the deduction of any amount deemed to be claimed or deducted under subsection (1) for the taxation year, is less than the total amount of provincial income tax that would be payable by the corporation for those taxation years, determined after the deduction of the amount deemed to be claimed or deducted under subsection (1) and after all consequential adjustments are made to the corporation’s income and taxable income for those taxation years that would be required by reason of the increase required by subsection (1) in the total amount deducted or claimed under the provision for the taxation year.  1998, c. 34, s. 27 (1); 2004, c. 16, s. 2 (2). Limitation (3) The maximum amount that a corporation is deemed to deduct or claim for a taxation year by virtue of subsection (1) under the provisions of this Act, or of the Income Tax Act
(Canada) as they apply for the purposes of this Act, shall not exceed the amount that would be the corporation’s taxable income for the taxation year under this Act before any amount is deemed to be deducted or claimed under this section for the taxation year.  1998, c. 34, s. 27 (1); 2004, c. 16, s. 2 (2). Partnerships (4) If a corporation is a member of a partnership during a taxation year, subsections (1), (2) and (3) apply with necessary modifications in determining the corporation’s share of the income or loss of the partnership for a fiscal period ending in the taxation year.  1998, c. 34, s. 27 (1); 2004, c. 16, s. 2 (2). Amalgamation and winding-up (5) For the purposes of this section, (a) a corporation that is formed as a result of an amalgamation or merger of two or more corporations shall be deemed to be the same corporation as, and a continuation of, each of the corporations that amalgamated or merged; and (b) a corporation that is a parent for the purposes of subsection 88 (1) of the Income Tax Act (Canada), or would be a parent if it were a taxable Canadian corporation, shall be deemed to be the same corporation as, and a continuation of, each corporation that, if it were a taxable Canadian corporation, would be described as a subsidiary in that subsection, after the winding-up of the subsidiary.  1999, c. 9, s. 73 (3); 2004, c. 16, s. 2 (2). Same (6) Subsection (5) applies in respect of amalgamations, mergers and windings-up of corporations during a taxation year that begins on or after the day that subsection comes into force.  1999, c. 9, s. 73 (3); 2004, c. 16, s. 2 (2). Section Amendments with date in force (d/m/y) 1998, c. 34, s. 27 (1, 2) - 18/12/1998; 1999, c. 9, s. 73 (1, 2) - 18/12/1998; 1999, c. 9, s. 73 (3) - 14/12/1999 2004, c. 16, s. 2 (2)
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