Calculated Percentages
Even when there is no taxable income (e.g., a corporation with a non-capital loss), the gross revenue and salaries and wages determine the allocation percentage. This percentage is used to calculate the provincial capital tax liability.
Permanent Establishments
When you enter gross revenue or salaries and wages, an X will appear in the permanent establishment field for that province. Enter an X manually for provinces where the corporation has no activity but it maintains a permanent establishment.
Provincial Credit Forms
Several of the less common provincial credit forms are not included in the program. In these cases complete the provincial credit form manually and enter the credit amount in the input cell provided in Schedule 5. Attach the provincial credit schedule to your return.
Regulation
The following instructions are taken from the form.
- Use this schedule if any of the following apply to your corporation during the tax year:
- it had a permanent establishment in more than one jurisdiction (corporations that have no taxable income should only complete columns A, B, and D in Part 1)
- it is claiming provincial or territorial tax credits or rebates (see Part 2)
- it has to pay taxes, other than income tax, for Newfoundland and Labrador or Ontario (see Part 2)
- All legislative references are to the federal Income Tax Regulations (the Regulations).
- For more information, see theT2 Corporation – Income Tax Guide.
|
Regulation |
Type of corporation |
Type of entry in column B |
Type of entry in column D |
|---|---|---|---|
|
402 |
Corporations not specified |
Salaries and wages |
Gross revenue |
|
403 |
Insurance corporations |
No entry required |
Net premiums |
|
404 |
Banks |
Salaries and wages |
Amount of loans and deposits |
|
404.1 |
Federal credit unions |
Salaries and wages |
Amount of loans and deposits |
|
405 |
Trust and loan corporations |
No entry required |
Gross revenue |
|
406(1) (Note 1) |
Railway corporations |
Equated track miles/kilometres |
Gross ton miles/kilometres |
|
406(2) (Note 1) |
Railway corporations (Note 2) |
The method of allocation depends on the business line - refer to the Regulations. |
|
|
407 |
Airline corporations |
Capital cost of fixed assets |
Revenue plane miles/kilometres (Note 4) |
|
408 |
Grain elevator operators |
Salaries and wages |
Bushels of grain received |
|
409 |
Bus and truck operators |
Salaries and wages |
Miles/kilometres driven |
|
410 (Note 5) |
Ship operators |
Salaries and wages (Note 6) |
Port-call-tonnage |
|
411 |
Pipeline operators |
Salaries and wages |
Miles/kilometres of pipeline |
|
412 |
Divided businesses |
The method of allocation depends on the business line - refer to the Regulations. |
|
|
413 |
Non-resident corporations |
The method of allocation depends on the business line - refer to the Regulations. |
|
|
Note 1 |
Include the subsection (with brackets) when entering this regulation on line 100 in Part 1 of this Schedule. |
|
Note 2 |
Operating an airline service, ships, hotels, or receiving substantial revenues from petroleum or natural gas royalties. |
|
Note 3 |
Exclude aircraft. |
|
Note 4 |
Exclude miles/kilometres flown over the territorial waters of Canada. |
|
Note 5 |
In Part 1, instead of taxable income, use the excess of taxable income over allocable income for the calculation in column C and allocable income for the calculation in column E. |
|
Note 6 |
Only where taxable income exceeds allocable income. |