Tax and Revenue Administration Alberta Corporate Tax Act Special Notice Vol. 5 No. 24

Vol. 5 No. 24 / December 2007

ALBERTA CORPORATE TAX ACT SPECIAL NOTICE:
Bill 36 - Alberta Corporate Tax Amendment Act, 2007
(Royal Assent December 7, 2007)

NOTE: This special notice is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this special notice and governing legislation, the legislation takes precedence.

Bill 36 – the Alberta Corporate Tax Amendment Act 2007 was passed on December 7, 2007.  Major changes to the Alberta Corporate Tax Act (the Act) include the following:

Alberta Small Business Deduction

The Alberta small business threshold was increased to $430,000 on April 1, 2007.  The threshold will increase to $460,000 on April 1, 2008, and $500,000 on April 1, 2009.

Alberta Royalty Tax Credit (ARTC) and Royalty Credit for Individuals and Trusts (RCIT)

The ARTC and RCIT programs were discontinued effective January 1, 2007.  Corporations, individuals, and trusts can claim ARTC and RCIT based on eligible Alberta crown royalties paid, or payable by them, for production before January 1, 2007.

Special rules were enacted to accommodate the discontinuance of the programs.  Generally, the rules allow for a pro-ration of the Crown Royalty Shelter (CRS) for taxation years beginning before January 1, 2007, and ending after December 31, 2006.

Alberta Finance and Enterprise, Tax and Revenue Administration (TRA), is currently preparing the 2007 guide for completing the Alberta Royalty Tax Credit – AT1 Schedule 6 calculation of the CRS.  TRA will post the guide on our website in mid January with instructions for claimants to make their claims.

All claims must be submitted to TRA within three years of the claimants' tax year-end. ARTC installment applications are to be made before the end of the corporation's taxation year.

GAAR