302. (1) Where in a taxation year a corporation had no permanent establishment outside Ontario, all of the corporation’s taxable income for the year shall be deemed to have been earned in Ontario. (2) Where in a taxation year a corporation had no permanent establishment in Ontario, all of the corporation’s taxable income for the taxation year shall be deemed to have been earned in jurisdictions other than Ontario. (3) Subject to subsection (5), where, in a taxation year, a corporation had a permanent establishment in Ontario and a permanent establishment in a jurisdiction other than Ontario, the amount of the corporation’s taxable income that shall be deemed to have been earned in the taxation year in that other jurisdiction is, (a) in any case other than a case specified in clause (b) or (c), one-half the aggregate of, (i) that proportion of the corporation’s taxable income for the taxation year that the gross revenue for the taxation year attributable to the permanent establishment in that other jurisdiction is of the corporation’s total gross revenue for the taxation year, and (ii) that proportion of the corporation’s taxable income for the taxation year that the aggregate of the salaries and wages paid in the taxation year by the corporation to the employees of the permanent establishments in that other jurisdiction is of the aggregate of all salaries and wages paid in the taxation year by the corporation; (b) in any case where the gross revenue for the taxation year of the corporation is nil, that proportion of the corporation’s taxable income for the taxation year that the aggregate of the salaries and wages paid in the taxation year by the corporation to employees of the permanent establishments in that other jurisdiction is of the aggregate of all salaries and wages paid in the taxation year by the corporation; and (c) in any case where the aggregate of the salaries and wages paid in the taxation year by the corporation is nil, that proportion of the corporation’s taxable income for the taxation year that the gross revenue for the taxation year reasonably attributable to the permanent establishments in that other jurisdiction is of the corporation’s total gross revenue for the taxation year. (4) For the purposes of subsection (3) and section 320 and subject to subsection (5), (a) where the destination of a shipment of merchandise to a customer to whom the merchandise is sold is in a jurisdiction in which the corporation making the sale has a permanent establishment, the gross revenue derived from the sale is attributable to that permanent establishment; (b) except as provided in clauses (c) and (d), where the destination of a shipment of merchandise to a customer to whom the merchandise is sold is in a jurisdiction in which the corporation making the sale has no permanent establishment, the gross revenue derived from the sale is attributable to the permanent establishment to which the person negotiating the sale may reasonably be regarded as being attached; (c) except as provided in clause (e), where the destination of a shipment of merchandise to a customer to whom the merchandise is sold is in a jurisdiction outside Canada in which the corporation making the sale has no permanent establishment, (i) where the merchandise was produced or manufactured, or produced and manufactured, entirely in one province or territory of Canada by the corporation, the gross revenue derived from the sale is attributable to the corporation’s permanent establishment in that province or territory, or (ii) where the merchandise was produced or manufactured, or produced and manufactured, partly in a province or territory of Canada and partly in another place by the corporation, the gross revenue derived from the sale that is attributable to its permanent establishment in that province or territory is that proportion thereof that the salaries and wages paid in the taxation year to employees of the permanent establishment in that province or territory where the merchandise was partly produced or manufactured, or partly produced and manufactured, is of the aggregate of the salaries and wages paid in the taxation year to employees of the permanent establishments where the merchandise was produced or manufactured, or produced and manufactured; (d) except as provided in clause (e), where a customer to whom merchandise is sold instructs that the shipment of the merchandise be made to another person, the destination of the shipment of the merchandise shall be deemed to be in the jurisdiction in which the permanent establishment of the customer negotiating the purchase of the merchandise is situated; (e) where a customer to whom merchandise is sold instructs that the shipment of the merchandise be made to another person and the permanent establishment of the customer negotiating the purchase of the merchandise is situated in a jurisdiction outside Canada in which the corporation making the sale has no permanent establishment, (i) where the merchandise was produced or manufactured, or produced and manufactured, entirely in one province or territory of Canada by the corporation, the gross revenue derived from the sale shall be attributable to its permanent establishment in that province or territory, or (ii) where the merchandise was produced or manufactured, or produced and manufactured, partly in a province or territory of Canada and partly in another place by the corporation, the gross revenue derived from the sale that is attributable to its permanent establishment in that province or territory is that proportion thereof that the salaries and wages paid in the taxation year to employees of the permanent establishment in that province or territory where the merchandise was partly produced or manufactured, or partly produced and manufactured, is of the aggregate of the salaries and wages paid in the taxation year to employees of the permanent establishments where the merchandise was produced or manufactured, or produced and manufactured; (f) where services are performed by a corporation in a jurisdiction in which the corporation has a permanent establishment, the gross revenue derived from the services is attributable to that permanent establishment; (g) where services are performed by a corporation in a jurisdiction in which the corporation has no permanent establishment, the gross revenue derived from the services is attributable to the permanent establishment to which the person negotiating the contract for the corporation may reasonably be regarded as being attached; (h) where standing timber or the right to cut standing timber is sold, the gross revenue derived from the sale is attributable to the permanent establishment that includes the timberlands on which the timber is standing; (i) gross revenue that arises from leasing land owned by the corporation in a province or territory shall be attributable to the province or territory where that land is situated; and (j) where land which constitutes a permanent establishment in a province under subsection 4 (7) of the Act is sold, and the income derived from the sale is included in determining the corporation’s income under paragraph 3 (a) of the Income Tax Act (Canada) as made applicable by section 9 of the Act, the gross revenue of the corporation derived from the sale for the taxation year shall be attributed to that permanent establishment. (5) In the application of subsections (3) and (4) and subsection 320 (3) for the purposes of this section and section 320, where, (a) the destination of a shipment of merchandise to a customer to whom the merchandise is sold by a corporation is in a country other than Canada or where the customer to whom the merchandise is sold instructs that the shipment of the merchandise be made by the corporation to another person and the permanent establishment of the customer negotiating the purchase of the merchandise is situated in a country other than Canada; (b) the corporation has a permanent establishment in that other country; and (c) the corporation is not subject to taxation on its income or profits under the laws of that other country or its gross revenue derived from the sale is not included in the profit or other base for income or profits taxation by that other country by reason of, (i) the provisions of any taxing statute of that other country, or (ii) the operation of any tax treaty or convention between Canada and that other country, the following rules apply: 1. Clauses (4) (a), (b) and (d) do not apply. 2. That portion of clause (4) (c) immediately preceding subclause (i) shall be read as follows: (c) except as provided in clause (e), where the destination of a shipment of merchandise to a customer to whom the merchandise is sold is in a jurisdiction outside Canada, . .  . .  . 3. That portion of clause (4) (e) immediately preceding subclause (i) shall be read as follows: (e) where a customer to whom merchandise is sold instructs that the shipment of the merchandise be made to another person and the permanent establishment of the customer negotiating the purchase of the merchandise is situated in a jurisdiction outside Canada, . .  . .  . 4. In the application of subclause (3) (a) (ii), clause (3) (b), subclauses (4) (c) (ii), (4) (e) (ii) and 320 (3) (a) (ii) and clause 320 (3) (b), salaries and wages paid in the taxation year to employees of any permanent establishment of the corporation situated in that other country shall be deemed to be nil. (6) For the purposes of this section, and sections 304, 307, 308, 309, 310, 311, 319, 320, 323, 324, 325, 326 and 327, where part of the operations of a corporation is conducted in partnership with one or more other persons, (a) the gross revenue of the corporation for the taxation year; and (b) the salaries and wages paid in the taxation year by the corporation, shall include, in respect of those operations, only that proportion of, (c) the total gross revenue of the partnership for its fiscal period ending in or coinciding with the taxation year; and (d) the total salaries and wages paid by the partnership in its fiscal period ending in or coinciding with the taxation year, respectively, that, (e) the corporation’s share of the income or loss of the partnership for the fiscal period ending in or coinciding with the taxation year, is of, (f) the total income or loss of the partnership for the fiscal period ending in or coinciding with the taxation year. (7) For the purposes of this section, and sections 304, 307, 308, 309, 310, 311, 320, 321, 324, 325, 326, 327 and 328, where a corporation pays a fee to a person under an agreement pursuant to which the person or employees of that person perform services for the corporation that would normally be performed by employees of the corporation, the fee so paid shall be deemed to be salary paid in the taxation year by the corporation and that part of the fee that may reasonably be regarded as payment in respect of services rendered at a particular permanent establishment of the corporation shall be deemed to be salary paid to an employee of that permanent establishment. (8) For the purpose of subsection (7), a fee does not include a commission paid to a person who is not an employee of the corporation. (9) For the purposes of subsection (3) and subsection 320 (3), “gross revenue” does not include interest on bonds, debentures or mortgages, dividends on shares of capital stock, or rentals or royalties from property that is not used in connection with the principal business operations of the corporation.  R.R.O. 1990, Reg. 183, s. 302.