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Income Tax Regulations

Version of section 400 from 2013-06-26 to 2020-06-17:

  •  (1) In applying the definition taxable income earned in the year in a province in subsection 124(4) of the Act for a corporation’s taxation year

    • (a) the prescribed rules referred to in that definition are the rules in this Part; and

    • (b) the amount determined under those prescribed rules means the total of all amounts each of which is the taxable income of the corporation earned in the taxation year in a particular province as determined under this Part.

  • (1.1) [Repealed, 2013, c. 33, s. 32]

  • (2) For the purposes of this Part, permanent establishment in respect of a corporation means a fixed place of business of the corporation, including an office, a branch, a mine, an oil well, a farm, a timberland, a factory, a workshop or a warehouse, and

    • (a) where the corporation does not have any fixed place of business it means the principal place in which the corporation’s business is conducted;

    • (b) where a corporation carries on business through an employee or agent, established in a particular place, who has general authority to contract for his employer or principal or who has a stock of merchandise owned by his employer or principal from which he regularly fills orders which he receives, the corporation shall be deemed to have a permanent establishment in that place;

    • (c) an insurance corporation is deemed to have a permanent establishment in each province and country in which the corporation is registered or licensed to do business;

    • (d) where a corporation, otherwise having a permanent establishment in Canada, owns land in a province, such land shall be deemed to be a permanent establishment;

    • (e) where a corporation uses substantial machinery or equipment in a particular place at any time in a taxation year it shall be deemed to have a permanent establishment in that place;

    • (e.1) if, but for this paragraph, a corporation would not have a permanent establishment, the corporation is deemed to have a permanent establishment at the place designated in its incorporating documents or bylaws as its head office or registered office;

    • (f) the fact that a corporation has business dealings through a commission agent, broker or other independent agent or maintains an office solely for the purchase of merchandise shall not of itself be held to mean that the corporation has a permanent establishment; and

    • (g) the fact that a corporation has a subsidiary controlled corporation in a place or a subsidiary controlled corporation engaged in trade or business in a place shall not of itself be held to mean that the corporation is operating a permanent establishment in that place.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • SOR/78-772, s. 1
  • SOR/81-267, s. 1
  • SOR/86-390, s. 1
  • SOR/94-140, s. 1
  • SOR/94-686, ss. 4(F), 57(F), 79(F)
  • 2009, c. 2, s. 91
  • SOR/2010-93, s. 8(F)
  • 2013, c. 33, s. 32
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