Canadian exploration 
expense

See discussion on page 12.

Canadian oil and gas 
property expense

See discussion on page 13.

Canadian partnership

At any time is a partnership all of the members of which are 
resident in Canada at that time.

Canadian resource property

A mining property or an oil and gas property in Canada. 

Capital cost allowance

The amount allowed to be deducted from income to account 
for the depreciation of capital property. The amount of capital 
cost allowance available for a property in a year will depend on 
its cost and what type of property it is. The Regulations contain 
a detailed categorization of types of property and the rates at 
which they can be depreciated.

Capital gain

A capital gain from a disposition of capital property is the amount 
by which the proceeds of disposition exceed the adjusted cost 
base and any reasonable costs of disposition.

Capital loss

A capital loss from a disposition of capital property is the amount 
by which the adjusted cost base and any reasonable costs of 
disposition exceed the proceeds of disposition.

Capital property

Capital property is property that, when disposed of, will give 
rise to a capital gain or a capital loss, rather than a gain or loss 
recognized on account of income. Property is capital property if 
the taxpayer acquires it to produce income rather than to resell 
it for a profit. Thus, inventory is not capital property, but each of 
land (other than a resource property) and machinery used in the 
mining process is capital property.

Capital tax

A tax on the capital of a corporation. For these purposes, the 
capital of a corporation consists of its equity and debt less an 
investment allowance for its interests in the equity and debt of 
other corporations.

Control

There are two types of control of a corporation recognized by 
the ITA: de jure control and de facto control. 

De jure control contemplates the right of control that rests in 
ownership of such a number of shares as carries with it the 
right to a majority of the votes in the election of the board of 
directors. 

De facto control contemplates control of a corporation, directly 
or indirectly in any manner whatever, as a matter of fact by the 
exertion of influence on the business and affairs of the corporation.

For the purposes of the acquisition-of-control rules in the ITA, 
an acquisition of control of a corporation occurs where a person 
acquires de jure control of the corporation.

© 2013 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms 
affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

 Glossary 

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