7-902332
24(1)
which of subsections 13(5) and 20(16) of the Income Tax Act (the "Act") apply
This is in reply to your memorandum of August 28, 1990 in which you requested our comments regarding the availability of a terminal loss under subsection 20(16) of the Act 24(1) a year subsequent to the first year in which subsection 20(16) might have had application.
Briefly the situation is:
24(1)
Terminal loss Issue
Subsection 20(16) of the Act provides rules for calculating a taxpayer's terminal loss at the end of a taxation year. As an aside the 1977, Notice of Ways and Means Motion stated that an amendment for that year meant that for taxation years ending after March 31, 1977, in respect of depreciable property a taxpayer is required to deduct a terminal loss in the year in which it arises whether or not the taxpayer has a source of income in that year.
24(1) 21(1)(b)
Applicability of subsection 13(5)
Subsection 13(5) of the Act is a rule of general application containing the rules for computing the undepreciated capital cost of property of a prescribed class that has been transferred from one class to another class.
21(1)(b) 24(1)
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