5.3 (1) In this section, “specified reserve” means, in relation to a corporation, an amount claimed as a deduction in determining income under Part II under any of the following provisions of the Income Tax Act
(Canada) as they apply for the purposes of Part II, or under the comparable provisions of the laws of a province that impose a tax calculated by reference to the corporation’s income: 1. Paragraphs 20 (1) (l), (l.1), (m), (m.1), (n) and (o). 2. Subsection 26 (2). 3. Subsection 32 (1). 4. Clauses 40 (1) (a) (iii) (C) and (D). 5. Subparagraphs 138 (3) (a) (i), (ii) and (iv). 6. Such other provisions as may be prescribed by regulation.  1999, c. 9, s. 74; 2004, c. 16, s. 2 (2). Anti-avoidance, provincial tax (2) The amount of a specified reserve claimed by a corporation in determining its income under Part II for a taxation year shall be deemed to be the amount determined under subsection (4) if the conditions set out in subsection (3) are satisfied.  1999, c. 9, s. 74; 2004, c. 16, s. 2 (2). When applicable (3) Subsection (2) applies to a corporation for a taxation year if the following conditions are satisfied: 1. The amount of the specified reserve claimed by the corporation is greater than the amount of the specified reserve that it claims for the purposes of determining its income under the laws of another province that impose a similar tax calculated by reference to the corporation’s income or for the purposes of determining the amount of its income under the Income Tax Act (Canada), or the corporation does not claim any amount in respect of the specified reserve in determining its income for the purposes of the income tax laws of another province or under the Income Tax Act (Canada). 2. The corporation’s Ontario allocation factor, as defined in subsection 12 (1), for a subsequent taxation year is at least 20 per cent less than its Ontario allocation factor for the taxation year, or would be at least 20 per cent less if the corporation had tax payable under Part II for the taxation year and subsequent taxation years. 3. It is reasonable to consider that the primary reason that the corporation is claiming different amounts of the specified reserve is to reduce the amount of income taxes payable to one or more provinces over the course of one or more taxation years. 4. The total amount of income tax payable by the corporation under this Act and under the income tax laws of other provinces for the period that includes the taxation year and subsequent taxation years would be less if subsection (2) did not apply.  1999, c. 9, s. 74; 2004, c. 16, s. 2 (2). Amount deemed to be claimed (4) If subsection (2) applies to a corporation for a taxation year in respect of a specified reserve claimed by the corporation, the amount the corporation is deemed to have claimed for the taxation year is the lesser of, (a) the least of the amounts claimed by the corporation as the specified reserve for the same taxation year in determining the amount of its income for the purposes of the income tax laws of another province or under the Income Tax Act (Canada); or (b) nil, if no specified reserve is claimed by the corporation for the taxation year in determining the amount of its income for the purposes of the income tax laws of another province or under the Income Tax Act (Canada).  1999, c. 9, s. 74; 2004, c. 16, s. 2 (2). Partnerships (5) If a corporation is a member of a partnership during a taxation year, subsections (1), (2), (3) and (4) 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.  1999, c. 9, s. 74; 2004, c. 16, s. 2 (2). Amalgamation and winding-up (6) 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. 74; 2004, c. 16, s. 2 (2). Application (7) This section applies with respect to a corporation’s taxation years that end on or after the day this section comes into force.  1999, c. 9, s. 74; 2004, c. 16, s. 2 (2). Section Amendments with date in force (d/m/y) 1999, c. 9, s. 74 - 14/12/1999 2004, c. 16, s. 2 (2)
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