54 (1) In this Division, “associated corporation”, of another corporation for a taxation year, means a corporation that is associated at any time in the year with the other corporation, whether or not either of them is subject to tax under this Act; (“société associée”) “excluded mark-to-market property” means, in respect of a corporation, property, other than specified mark-to-market property, held by the corporation, and in respect of which, (a) any mark-to-market changes recognized under generally accepted accounting principles from the beginning to the end of a taxation year of the corporation would be reflected in the calculation of the corporation’s income for the taxation year for the purposes of Division B of Part III if the property were held by the corporation throughout the taxation year, or (b) if the property is denominated in a foreign currency, any change under generally accepted accounting principles in the value of that currency relative to Canadian currency from the beginning to the end of a taxation year of the corporation would be reflected in the calculation of the corporation’s income for the taxation year for the purposes of Division B of Part III if the property were held by the corporation throughout the taxation year; (“bien évalué à la valeur du marché qui est exclu”) “fair value” means, in respect of property of a corporation, the amount determined in accordance with generally accepted accounting principles that is the fair value of the property to the corporation, expressed in Canadian currency; (“juste valeur”) “mark-to-market changes” means, with respect to a specified mark-to-market property or excluded mark-to-market property held by a corporation, changes in the fair value of the property that occur after the corporation acquires the property and before the corporation disposes of the property; (“variation de l’évaluation à la valeur du marché”) “relevant authority” means, with respect to a life insurance corporation, (a) the Superintendent of Financial Institutions, if the life insurance corporation is required by law to report to the Superintendent of Financial Institutions, or (b) the authority in the province under the laws of which the life insurance corporation is incorporated that performs a similar function to the Superintendent of Financial Institutions, in any other case; (“autorité compétente”) “specified mark-to-market property” means, in respect of a corporation, property, other than excluded mark-to-market property, held by the corporation and in respect of which, (a) any mark-to-market changes recognized under generally accepted accounting principles from the beginning to the end of a taxation year of the corporation would be reflected in the calculation of the corporation’s net income for the taxation year for the purposes of this Division if the property were held by the corporation throughout the taxation year, or (b) if the property is denominated in a foreign currency, any change under generally accepted accounting principles in the value of that currency relative to Canadian currency from the beginning to the end of a taxation year of the corporation would be reflected in the calculation of the corporation’s net income for the taxation year for the purposes of this Division if the property were held by the corporation throughout the taxation year; (“bien évalué à la valeur du marché qui est déterminé”) “total assets” means, subject to subsection (1.1), the amount that would be shown on a corporation’s balance sheet at the end of a taxation year as the corporation’s total assets if the balance sheet were prepared in accordance with generally accepted accounting principles, except that the consolidation and equity methods of accounting are not to be used; (“actif total”) “total revenue” means, with respect to a corporation for a taxation year, the amount that would be the corporation’s gross revenue for the year as determined in accordance with generally accepted accounting principles, except that the consolidation and equity methods of accounting are not used. (“recettes totales”)  2007, c. 11, Sched. A, s. 54 (1); 2008, c. 7, Sched. S, s. 14 (1, 2). Adjustment to total assets re: specified mark-to-market property (1.1) The amount in respect of a specified mark-to-market property to be included in the total assets of a corporation for a taxation year for the purposes of this Division is determined without reference to mark-to-market changes with respect to the specified mark-to-market property.  2008, c. 7, Sched. S, s. 14 (3). Net income or net loss (2) For the purposes of this Division, the net income or net loss of a corporation for a taxation year is, (a) in the case of a corporation resident in Canada, other than a life insurance corporation or a bank, the amount that would be its net income or net loss, before any income taxes, for the fiscal period coinciding with the taxation year, as determined in accordance with generally accepted accounting principles, except that the consolidation and equity methods of accounting are not used; (b) in the case of a corporation not resident in Canada, other than a life insurance corporation or a bank, the amount that would be its net income or net loss before any income taxes for the fiscal period coinciding with the taxation year, as determined in accordance with generally accepted accounting principles, except that the consolidation and equity methods of accounting are not used, from, (i) carrying on a business in Canada, and (ii) property situated in Canada or used in carrying on a business in Canada, including any gains or losses from a disposition of the property or an interest in it; (c) in the case of a life insurance corporation resident in Canada during the year that carries on business both in and outside Canada during the year, the amount calculated using the formula, A/B × C in which, “A” is the amount of the life insurance corporation’s Canadian reserve liabilities as at the end of the year, “B”   is the amount of the life insurance corporation’s total reserve liabilities as at the end of the year, and “C”   is the amount of the life insurance corporation’s net income or net loss for the fiscal period coinciding with the taxation year, before the deduction of any income taxes and any tax payable under section 63, as reported in its annual report accepted by the relevant authority or, if the fiscal period does not coincide with the taxation year, a report prepared for the taxation year in accordance with the principles required by the relevant authority, adjusted if necessary so that the consolidation and equity methods of accounting are not used; (d) in the case of a life insurance corporation other than a corporation referred to in clause (c), the amount of the life insurance corporation’s net income or net loss for the fiscal period coinciding with the taxation year, before the deduction of any income taxes and any tax payable under section 63 as reported in its annual report accepted by the relevant authority or, if the fiscal period does not coincide with the taxation year, a report prepared for the taxation year in accordance with the principles required by the relevant authority, adjusted if necessary so that the consolidation and equity methods of accounting are not used; or (e) in the case of a bank, the amount of its net income or net loss for the fiscal period coinciding with the taxation year, before any income taxes, as reported in its annual report accepted by the Superintendent of Financial Institutions under the Bank Act (Canada), or if the fiscal period does not coincide with the taxation year, a report prepared for the taxation year in accordance with the principles required by the Superintendent of Financial Institutions, adjusted if necessary so that the consolidation and equity methods of accounting are not used. 2007, c. 11, Sched. A, s. 54 (2). Total revenue of corporate partner (3) If a corporation is a partner in a partnership at the end of a fiscal period of the partnership that ends in a taxation year of the corporation, the corporation’s total revenue for the taxation year for the purposes of this Division includes the product of, (a) the corporation’s percentage share in the partnership at the end of that fiscal period; and (b) the total revenue of the partnership for that fiscal period.  2007, c. 11, Sched. A, s. 54 (3). Total assets of corporate partner (4) If a corporation is a partner in a partnership at the end of the last fiscal period of the partnership that ends in a taxation year of the corporation, the amount of the corporation’s total assets for the taxation year for the purposes of this Division includes the product of, (a) the corporation’s percentage share in the partnership at the end of that fiscal period; and (b) the total assets of the partnership at the end of that fiscal period.  2007, c. 11, Sched. A, s. 54 (4). Partnership (5) Subject to subsection (6), for the purposes of this Division, (a) a partnership’s net income or net loss and its total assets and total revenue shall be determined in accordance with generally accepted accounting principles, except that the consolidation and equity methods of accounting shall not be used; (b) a corporation’s percentage share in a partnership at the end of a fiscal period is the corporation’s direct or indirect percentage interest in the income or loss of the partnership for the fiscal period which shall, if the partnership has no income or loss for the fiscal period, be the percentage that would reasonably be considered to represent the corporation’s direct or indirect percentage interest in the income of the partnership for the fiscal period if the partnership’s income for the fiscal period were $1 million; and (c) if a corporation has an indirect interest in the partnership at the end of a fiscal period through one or more other partnerships, the fiscal period is deemed to end in a taxation year of the corporation to which it is reasonable to expect that the partnership’s income or loss for the fiscal period would be indirectly allocated under the Federal Act.  2007, c. 11, Sched. A, s. 54 (5); 2008, c. 7, Sched. S, s. 14 (4). Exception for total assets (6) The amount in respect of a specified mark-to-market property to be included in the total assets of a partnership for a fiscal period for the purposes of applying subsection (4) to a corporation for a taxation year is determined without reference to any mark-to-market change with respect to the specified mark-to-market property.  2008, c. 7, Sched. S, s. 14 (5). Same (7) For the purposes of subsection (6), any mark-to-market changes with respect to property of a partnership are determined as if the partnership were a corporation and its fiscal period were a taxation year.  2008, c. 7, Sched. S, s. 14 (5). Section Amendments with date in force (d/m/y) 2008, c. 7, Sched. S, s. 14 (1-5) - 01/01/2008