Tax Terms
Accelerated capital cost
allowance
Rapid capital cost allowance for a specific class of property in
specific circumstances. In the mining context, a taxpayer is
entitled to accelerated capital cost allowance of up to 100% for
property belonging to Class 41(a) or Class 41(a.1).
Active business income
In the context of the foreign affiliate rules, active business
income includes income earned from any business (other than
an investment business or a non-qualifying active business)
and certain income from property such as interest, royalties,
and rent that is deemed by the foreign affiliate rules to be active
business income.
Adjusted cost base
The cost of acquisition of a property as adjusted by the ITA.
Adjusted cumulative foreign
resource expense
Consists of cumulative foreign resource expenses as adjusted
to take into account a transaction subject to the successor
corporation rules.
Adjusted stub period accrual
See discussion page 33.
All or substantially all
The ITA does not define the term “all or substantially all.” The
CRA takes the position that all or substantially all means 90%
but does not provide a methodology to use in the calculation of
all or substantially all. The limited jurisprudence available does
not provide much guidance.
Allowable capital loss
One-half of a capital loss.
Allowance for depreciation
Allowance for depreciation means an allowance for the
undepreciated value of depreciable assets for certain provincial
mining tax regimes. Depreciable assets include the costs of
the mine, mill, plant, and equipment, as well as exploration and
development expenses. The allowance is permitted as part of
the calculation to determine the theoretical value of the ore, at
the mouth of the mine, on which the mining tax is calculated.
Allowance for processing
An allowance by way of return on capital employed in the
secondary crushing, grinding, concentrating, chemical
extraction, smelting, refining, or packaging of output. The
allowance is permitted as part of the provincial mining tax
calculation to determine the theoretical value of the ore, at the
mouth of the mine, on which the mining tax is calculated.
Canadian-controlled private
corporation
A private corporation that is a Canadian corporation and that is
not controlled by one or more non-residents of Canada, one or
more public corporations, or any combination of them.
Canadian corporation
A corporation incorporated in any jurisdiction in Canada or
resident in Canada.
Canadian development
expense
See discussion on page 12.
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A Guide to Canadian Mining Taxation