,canada ,cu/oms #a & ,rev5ue ,ag5cy ,9t]pret,n ,bullet9 ,subject3 ,9come ,tax ,act--,3v].n ( ,prop]ty1 ,o!r ?an ,r1l ,prop]ty1 f or 6,9v5tory ,numb]3 ,,it-#ajb;,r#b ,date3 ,july #bb1 #aihe ,ref];e3 ,sec;n #i 7al sec;n #de1 subsec;ns #ac7#g7 & #bdh7#a71 & p>agraphs #ac7#ba77c7 & #ed7a71 7b7 & 7c77 ,! -;ts 9 ? bullet9 apply = tax,n ye>s -m5c+ af xs issue date4 ,,it-#ajb;,r w 3t9ue 6apply = tax,n ye>s -m5c+ 2f t date4 ,proposals 3ta9$ 9 ! ,notices ( ,ways & ,m1ns ,mo;ns ( ,may #i & ,may #bc1 #aihe >e n 3sid]$ 9 ? rel1se4 #a4 ,? bullet9 d1ls ) 3v].ns ( busi;s prop]ty1 o!r ?an r1l prop]ty ei f 9v5tory 6capital prop]ty or f #a ,,it-#ajb;,r#b a#a capital prop]ty 69v5tory1 )\t a *ange 9 [n]%ip "!(4 ,! bullet9 does n d1l )! rules 9 sec;n #de 3c]n+ ! det]m9,n ( capital ga9s or losses or )! rules 9 subsec;n #ac7#g7 3c]n+ capital co/ all[.e & xs recapture4 ,see ,,it-#bah =! ,de"p;t's views on pr(it on ! sale ( r1l prop]ty o!r ?an a pr9cipal resid;e4 #b4 ,9v5tory is def9$ 9 subsec;n #bdh7#a7 z 2+ 8a descrip;n ( prop]ty ! co/ or value ( : is relevant 9 -put+ a taxpay]'s 9come f a busi;s =a tax,n ye>04 ,capital prop]ty is def9$ 9 p>agraph #ed7b7 z 2+ 8any deprecia# prop]ty (! taxpay]1 & any prop]ty 7o!r ?an deprecia# prop]ty71 any ga9 or loss f ! 4posi;n ( : wd1 if ! prop]ty 7 4pos$ (1 2 a capital ga9 or a capital loss1 z ! case may be1 (! taxpay]04 #c4 ,capital prop]ty1 :e!r or n deprecia# prop]ty (a prescrib$ class1 t is us$ =! purpose ( e>n+ 9come #b ,,it-#ajb;,r#b b#a f a busi;s or prop]ty is n1 z a g5]al rule1 3v]t$ 69v5tory simply 2c x is put on ! m>ket = sale4 ,acly1 ": capital prop]ty is sold1 ! sales proce$s w ord9>ily 2 tr1t$ z proce$s ( 4posi;n ( capital prop]ty = all purposes (! ,act4 ,x is1 h["e1 ! ,de"p;t's posi;n t excep;ns 6? g5]al rule w o3ur4 #d4 ,": a taxpay] bo? sells & ei r5ts or l1ses prop]ty (! same k9d1 x is ! ,de"p;t's posi;n t all proce$s f ! sale ( prop]ty t has be5 r5t$ or l1s$ 3/itutes 9come (! taxpay] f ! sale ( 9v5tory un.s --------------------------------------#b 7a7 ! taxpay] op]ates a sep>ate & cle>ly 4t+ui%a# l1s+ divi.n1 9clud+ ! keep+ ( sep>ate records1 7b7 specific prop]ty is set aside 0! taxpay] = ei r5t+ or l1s+ & is factu,y s us$1 & #c ,,it-#ajb;,r#b a#b 7c7 prop]ties t >e s r5t$ or l1s$ >e norm,y sold = an am.t t is less ?an _! co/ 6! taxpay]4 ,": ! 3di;ns 9 7a7 to 7c7 abv >e -pli$ )1 ! ultimate 4posal ( prop]ty us$ = r5t+ or l1s+ w 2 tr1t$ z ! 4posal ( capital prop]ty4 #e4 ,x is recogniz$ t a taxpay] ^: busi;s 3si/s only (! r5t+ or l1s+ ( prop]ty is1 f "t 6"t1 requir$ 6renew s* prop]ty 0sell+ x af x has be5 r5t$ or l1s$ =a p]iod ( "t1 & pur*as+ new prop]ty4 ,9 ^! circum/.es1 ": ! proce$s f ! 4posal ( ea* 9dividual prop]ty norm,y exce$ ! taxpay]'s co/ "!(1 ! proce$s f ! sale ( all (! taxpay]'s prop]ty t has be5 r5t$ or l1s$ w 2 3sid]$ 6be rcvd 0! taxpay] on a3.t ( 9come r ?an capital4 #f4 ,not)/&+ #d & #e abv1 ":1 at any "t1 "picul> prop]ty is l1s$ 7a7 )\t op;n 6pur*ase1 #d ,,it-#ajb;,r#b b#b 7b7 =a su6ici5tly l;g p]iod ( "t s t ! anticipat$ sales price (! "picul> prop]ty at ! "t ( expiry (! l1se w n ord9>ily exce$ xs co/ 6! lessor1 & 7c7 ! "picul> prop]ty is n ord9>ily replac$ 0o!r prop]ty dur+ ! curr5cy (! l1se1 ! lessor may1 f t "t1 tr1t ! "picul> prop]ty z capital prop]ty r ?an 9v5tory = all purposes (! ,act4 #g4 ,! facts ( ea* case w det]m9e :e!r or n a 3v].n ( prop]ty1 z describ$ 9 #a abv has o3urr$4 ,= example1 a 3v].n is g5],y n 3sid]$ 6h tak5 place ": 7a7 prop]ty t 0 pur*as$ prim>ily = resale is tempor>ily )drawn f 9v5tory & us$ 9 a busi;s 6e>n 9come1 = example demon/rator or c\rtesy vehicles 0a c> d1l]1 salesm5's samples or ! use ( equip;t 0employees 9 c>ry+ \ _! busi;s responsibilities1 or #e ,,it-#ajb;,r#b c#b 7b7 ! co/ ( prop]ty 0 9correctly classifi$ 9 ! a3.ts (a busi;s & has be5 reclassifi$ 6reflect ! use made (! prop]ty1 z capital prop]ty or 9v5tory1 z ! case may be1 s9ce x 0 acquir$4 --------------------------------------#c ,capital ,prop]ty ,3v]t$ 6,9v5tory #h4 ,": capital prop]ty is 3v]t$ 69v5tory1 ! ac;n ( 3v].n does n 3/itute a 4posi;n )9 ! m1n+ ( p>agraphs #ac7#ba77c7 & #ed7c74 ,x is1 h["e1 recogniz$ t ! ultimate 4posi;n (a prop]ty t 0 s 3v]t$ may give rise 6a ga9 or loss on capital a3.t1 a ga9 or loss on 9come a3.t or a ga9 or loss t is "ply capital & "ply 9come4 ,acly1 ) respect 6capital prop]ty t has be5 3v]t$ 69v5tory1 taxpay]s may calculate capital ga9s or losses1 if any1 on ! basis t a no;nal 4posi;n ( s* prop]ty o3urr$ on ! date ( 3v].n4 ,! am.t #f ,,it-#ajb;,r#b a#c ( s* a no;n,y det]m9$ capital ga9 or loss 9 respect (a prop]ty w 2 ! di6];e 2t xs adju/$ co/ base1 z def9$ 9 p>agraph #ed7a71 7subject 6! ,,itar rules = prop]ty held on ,decemb] #ca1 #aiga7 & xs fair m>ket value on ! date ( 3v].n4 ,^! no;n,y det]m9$ capital ga9s or losses w 2 3sid]$ 6give rise 6taxa# capital ga9s or all[a# capital losses =! tax,n ye> dur+ : ! actual 4posi;n (! relevant prop]ty o3urs & w 2 requir$ 6be s report$ 9 t same ye>4 ,! am.t ( any 9come ga9 or loss >is+ on actual 4posi;n (! 3v]t$ prop]ty w 2 det]m9$ 9 a3ord.e ) g5],y a3ept$ a3.t+ pr9ciples on ! basis t xs 9itial 9v5tory value is xs fair m>ket value on ! date ( 3v].n4 ,9v5tory ,3v]t$ 6,capital ,prop]ty #i4 ,": at any "t a taxpay] f9ds x nec 63v]t a "picul> prop]ty f 9v5tory #g ,,it-#ajb;,r#b b#c 6capital prop]ty1 xs capital co/ = all purposes (! ,act w 2 xs 9v5tory value at t "t4 ,s* a 3v].n mi prop]ty 9 9v5tory 7a7 is requir$ = l1se 9 ! l1s+ divi.n (a taxpay] describ$ 9 #d abv1 7b7 has be5 l1s$ 0any taxpay] "u ! 3di;ns describ$ 9 #f abv1 or 7c7 is o!rwise us$ 0! taxpay] z a fix$ asset (! busi;s4 #aj4 ,! 3v].n (a unit ( m]*&ise f 9v5tory 6capital prop]ty1 z 5visag$ 0#i abv1 is n 3sid]$ 6be ei a 4posi;n or an acquisi;n4 ,"!=e1 on s* a 3v].n1 ! applic,n (! half-rate capital co/ all[.e rules 9 ! f/ ye> ( [n]%ip w 2 bas$ on ! actual date ( acquisi;n r ?an ! date ( 3v].n4 #h