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Newfoundland and Labrador
Regulation 2010


NEWFOUNDLAND AND LABRADOR REGULATION 67/10

NEWFOUNDLAND AND LABRADOR
REGULATION 67/10

Resort Property Investment Tax Credit Regulations
(Amendment)
under the
Income Tax Act, 2000
(O.C. 2010-225)

(Filed August 10, 2010)

Under the authority of section 46.1 of the Income Tax Act, 2000, the Lieutenant-Governor in Council makes the following regulations.

Dated at St. John’s, August 9, 2010.

Gary Norris
Clerk of the Executive Council

REGULATIONS

Analysis


        1.   S.2 Amdt.
Definitions

        2.   S.5 Amdt.
Application for tax credit receipt

        3.   S.7 Amdt.
Holding period

        4.   S.9 Amdt.
Revocation of certificate of registration as a qualifying resort developer

        5.   S.13 Amdt.
Breach


NLR 85/07
as amended

        1. Paragraph 2(f) of the Resort Property Investment Tax Credit Regulations is repealed and the following substituted:

              (f)  "qualifying investor" means a person other than a trust who invests in a qualifying resort development property unit, and where, in the case of an individual investor, the person is 19 years of age or older;

 

        2. (1) Paragraph 5(7)(c) of the regulations is repealed and the following substituted:

             (c)  where construction of fewer than 50 of the qualifying resort development property units has been completed, the qualifying resort developer has provided a guarantee or other security to the minister in the form required by the minister in the amount of $500,000;

          (c.1)  where the qualifying investor and the qualifying resort developer or owner are not, in the opinion of the minister, at arm's length from each other, the purchase price paid by the qualifying investor for the qualifying resort development property unit is the price that he or she would have paid if he or she was a person purchasing the unit at arm's length from the qualifying resort developer or owner;

             (2)  Section 5 of the regulations is amended by adding immediately after subsection (7) the following:

          (7.1)  A qualifying resort developer may reduce the guarantee or other security referred to in paragraph (7)(c) by $10,000 for each qualifying resort development property unit with respect to which the qualifying resort developer has completed construction and offered it for sale, to a maximum of $400,000 and 40 units.

          (7.2)  A qualifying resort developer shall not reduce the guarantee or other security referred to in paragraph (7)(c) beyond the maximum amount referred to in subsection (7.1) until he or she has completed construction of the remaining 10 units and offered them for sale.

          (7.3)  A qualifying resort development complex to which paragraph (7)(c) applies shall comply with the requirements of subparagraphs 2(h)(iv) to (vii) not later than when the qualifying resort developer transfers title to the twenty-fifth qualifying resort development property unit and, where it doesn’t, the minister shall not issue further tax credit receipts until those requirements are met.

 

        3. Subsection 7(3) of the regulations is repealed.

 

        4. Paragraph 9(2)(a) of the regulations is repealed and the following substituted:

             (a)  a tax credit receipt has been issued, the qualifying resort developer is liable for the full amount of the tax credit and shall immediately forfeit to the minister from the guarantee or other security referred to in paragraph 5(7)(c) an amount equal to the aggregate of the amounts of the tax credit receipts issued for the qualifying resort development property units; or

 

        5. Subsection 13(1) of the regulations is repealed and the following substituted:

Breach

      13. (1) A breach of the 5 year operating commitment under paragraph 3(2)(f) shall result in the forfeiture to the minister of the guarantee or other security referred to in paragraph 5(7)(c).