(§ 11-602(b), Administrative Code.)
(a) The term "business capital" means the total average fair market value of all the taxpayer's assets (whether or not shown on its balance sheet), exclusive of stock issued by the taxpayer or assets constituting subsidiary capital (19 RCNY § 11-46, "subsidiary capital," infra) or investment capital (19 RCNY § 11-36, "investment capital," supra), less current liabilities (other than loans or advances outstanding for more than a year) payable by their terms on demand or not more than one year from the date incurred, to the extent such liabilities are not deducted in computing subsidiary capital or investment capital.
(b) Liabilities so deductible include notes, accounts payable, wages payable, accrued taxes, expenses and interest. Notes and other written obligations payable by their terms on demand or not more than one year from their date, which are regularly renewed from year to year, are not deductible in computing business capital. Loans or advances outstanding for more than a year as of any date during the year covered by the report, are not deductible in computing business capital. Where a taxpayer owns property subject to a debt, lien or encumbrance or other obligation, the fair market value of the property, not merely the taxpayer's equity therein, shall be used in computing the average fair market value of the property in valuing business capital, whether or not the taxpayer has any personal liability under any obligation to which the property is held subject.
(c) The term "business capital" includes loans to a subsidiary, the interest on which is claimed by and allowed to the subsidiary as a deduction for purposes of any tax imposed by Title 11, Chapter 6, Subchapter 2 or Subchapter 3 of the Administrative Code, provided such loans do not constitute investment capital pursuant to 19 RCNY § 11-37.
(d) (1) If in a taxable year a taxpayer has business capital but no investment capital, cash in hand and cash on deposit (as defined in 19 RCNY § 11-37(a)(3)) must be treated on all reports for the taxable year as business capital.
(2) If in a taxable year a taxpayer has both business and investment capital, the taxpayer may elect to treat cash on hand and cash on deposit (as defined in 19 RCNY § 11-37(a)(3)) as business capital. A taxpayer may not elect to treat part of its cash as business capital and part as investment capital. No election to treat cash as business capital may be made if the taxpayer has no business capital exclusive of cash. Any taxpayer who may elect under this paragraph (2) will be presumed to have made an irrevocable election to treat cash as business capital for that taxable year unless such taxpayer properly elects under 19 RCNY § 11-37(a)(2)(ii) to treat cash on hand and on deposit as investment capital.