Interpretation

1   In this regulation:

"Act" means the Assessment Act;

"chronological age" means the number of years determined by subtracting

(a) the year in which the plant first commenced operation, or

(b) in the case of an industrial improvement or part of an industrial improvement that was constructed or installed after the plant commenced operation, the year in which the construction or installation of the industrial improvement or part of it was completed

from the year in which the new assessment roll is completed;

"effective age" means the number of years determined by

(a) calculating the total cost of the industrial improvement,

(b) multiplying the chronological age of each part of the industrial improvement by the cost of that part to give the weighted age of that part,

(c) adding the weighted ages of all of the parts of the industrial improvement, and

(d) dividing the sum of the weighted ages by the total cost of the industrial improvements and rounding the quotient up to the next whole year to yield the effective age;

"LNG improvement" means an industrial improvement that is part of a major LNG plant or part of an industrial improvement that is part of a major LNG plant;

"major LNG plant" means a plant that is designed

(a) to process natural gas, and

(b) to produce at least 4 million tonnes of liquefied natural gas per year,

and includes associated facilities used for the loading of liquefied natural gas onto sea going ships or barges and storage facilities that are ancillary to those loading facilities.

[am. B.C. Reg. 76/2015, s. 1.]

Determining depreciation

2   Subject to the other provisions of this regulation, for the purposes of section 20 of the Act, depreciation of an industrial improvement shall be applied in accordance with the following formula:

where

(a) "annual depreciation rate" is the percentage rate set out in the Schedule for the category of plant of which the industrial improvement is a part, and

(b) "age" is the chronological age or, where parts of an industrial improvement have different chronological ages, the effective age of the industrial improvement.

[am. B.C. Reg. 76/2015, s. 2.]

Maximum depreciation

3   If the depreciation determined under section 2 for an industrial improvement is equal to or in excess of 80%, the depreciation shall be deemed to be 80%.

Major LNG plants that have not commenced operation

3.1   (1) For the purposes of section 20 of the Act, this section prescribes the depreciation rate for an LNG improvement that is part of a major LNG plant that has not commenced operation.

(2) The depreciation rate is 40% for the year that the construction or installation of an LNG improvement commences and for each following year up to and including the year before the year that the major LNG plant commences operation.

[en. B.C. Reg. 76/2015, s. 3.]

Major LNG plants that have commenced operation

3.2   (1) For the purposes of section 20 of the Act, this section prescribes the depreciation rate for an LNG improvement that is part of a major LNG plant that has commenced operation.

(2) Subject to section 4, the depreciation rate for an LNG improvement whose construction or installation commenced before or in the year that the major LNG plant commenced operation is the rate set out in column 2 for the year set out in column 1 of the following Table 1:

Table 1

(3) Subject to section 4, the depreciation rate for an LNG improvement whose construction or installation commenced in a year after the year that the major LNG plant commenced operation is the rate set out in column 2 for the year set out in column 1 of the following Table 2:

Table 2

[en. B.C. Reg. 76/2015, s. 3.]

Closure allowances

4   (1) If the assessor determines

(a) that a plant is closed on or before October 31 of any year and the owner of the plant or a senior executive officer of the corporation that owns the plant confirms in writing that the closure is permanent, or

(b) that a plant has been closed for a minimum of 3 consecutive years immediately preceding October 31 in any year and the owner of the plant or a senior executive officer of the corporation that owns the plant confirms in writing the fact that the plant is closed and the duration of that closure,

the depreciation applicable to industrial improvements that are part of the plant shall, for the purposes of the assessment roll in the succeeding year, be deemed to be an amount sufficient to reduce the actual value of the industrial improvements to 10% of the cost of those industrial improvements.

(2) If the assessor determines that

(a) a separate industrial improvement within a plant is permanently closed or shut down on or before October 31 in any year and the owner or plant manager of the plant confirms in writing that the closure or shut down is permanent, or

(b) a separate industrial improvement within a plant has been closed or shut down for a minimum of 3 consecutive years immediately preceding October 31 in any year and the owner or plant manager confirms in writing the fact that the industrial improvement is closed or shut down and the duration of that closure or shut down

the depreciation applicable to that industrial improvement shall, for the purpose of the assessment roll in the succeeding year, be deemed to be an amount sufficient to reduce the actual value of the industrial improvement to 10% of the cost of that improvement.

(2.1) In addition to the requirements of subsection (1) or (2), a confirmation under this section must

(a) be made to the assessor of the assessment area in which the plant is located,

(b) be made by the November 30 next following the October 31 referred to in subsection (1) or (2),

(c) in the case of subsection (1) (a) or (2) (a), specify the date of the permanent closure or shutdown, and

(d) in the case of subsection (1) (b) or (2) (b), specify the commencement date and duration of the closure or shutdown

in order to be effective for the following tax year.

(3) Subsection (2) applies only with respect to a complete industrial improvement and shall not be applied to a part of an industrial improvement.

(4) If a previously closed plant or industrial improvement is reopened or reactivated, this section ceases to apply for the purposes of the assessment roll in the succeeding year and depreciation shall be determined in accordance with sections 2, 3 and 3.2.

(5) Repealed. [B.C. Reg. 364/2002, s. (b).]

[am. B.C. Regs. 475/92, s. (a); 396/99; 364/2002; 76/2015, s. 4.]

Rounding down amounts

5   The assessment authority may round the amount of depreciated value calculated under this regulation

(a) down to the nearest $100, where the value determined is greater than $101 and less than $99 999, and

(b) down to the nearest $1 000, where the value determined is $100 000 or greater.

[en. B.C. Reg. 475/92, s. (b); am. B.C. Regs. 292/2007, s. 2; 76/2015, s. 5.]