II, s. 98
120.31(1)The definitions in subsection 110.2(1) apply in this section.Marginal note:Addition to tax payable(2)There shall be added in computing an individual’s tax payable under this Part for a particular taxation year the total of all amounts each of which is the amount, if any, by which(a)the individual’s notional tax payable for an eligible taxation year to which a specified portion of a qualifying amount received by the individual relates and in respect of which an amount is deducted under section 110.2 in computing the individual’s taxable income for the particular yearexceeds(b)the individual’s tax payable under this Part for the eligible taxation year.Marginal note:Notional tax payable(3)For the purpose of subsection (2), an individual’s notional tax payable for an eligible taxation year, calculated for the purpose of computing the individual’s tax payable under this Part for a taxation year (in this subsection referred to as “the year of receipt”) in which the individual received a qualifying amount, is the total of(a)the amount, if any, by which(i)the amount that would be the individual’s tax payable under this Part for the eligible taxation year if the total of all amounts, each of which is the specified portion, in relation to the eligible taxation year, of a qualifying amount received by the individual before the end of the year of receipt, were added in computing the individual’s taxable income for the eligible taxation yearexceeds(ii)the total of all amounts each of which is an amount, in respect of a qualifying amount received by the individual before the year of receipt, that was included because of this paragraph in computing the individual’s notional tax payable under this Part for the eligible taxation year, and(b)if the eligible taxation year ended before the taxation year preceding the year of receipt, an amount equal to the amount that would be calculated as interest payable on the amount, if any, by which the amount determined under paragraph (a) in respect of the eligible taxation year exceeds the taxpayer’s tax payable under this Part for that year, if the amount that would be calculated as interest payable on that excess were calculated(i)for the period that began on May 1 of the year following the eligible taxation year and that ended immediately before the year of receipt, and(ii)at the prescribed rate that is applicable for the purpose of subsection 164(3) with respect to the period.
(a)the individual’s notional tax payable for an eligible taxation year to which a specified portion of a qualifying amount received by the individual relates and in respect of which an amount is deducted under section 110.2 in computing the individual’s taxable income for the particular year
(b)the individual’s tax payable under this Part for the eligible taxation year.
(a)the amount, if any, by which(i)the amount that would be the individual’s tax payable under this Part for the eligible taxation year if the total of all amounts, each of which is the specified portion, in relation to the eligible taxation year, of a qualifying amount received by the individual before the end of the year of receipt, were added in computing the individual’s taxable income for the eligible taxation yearexceeds(ii)the total of all amounts each of which is an amount, in respect of a qualifying amount received by the individual before the year of receipt, that was included because of this paragraph in computing the individual’s notional tax payable under this Part for the eligible taxation year, and(b)if the eligible taxation year ended before the taxation year preceding the year of receipt, an amount equal to the amount that would be calculated as interest payable on the amount, if any, by which the amount determined under paragraph (a) in respect of the eligible taxation year exceeds the taxpayer’s tax payable under this Part for that year, if the amount that would be calculated as interest payable on that excess were calculated(i)for the period that began on May 1 of the year following the eligible taxation year and that ended immediately before the year of receipt, and(ii)at the prescribed rate that is applicable for the purpose of subsection 164(3) with respect to the period.
(i)the amount that would be the individual’s tax payable under this Part for the eligible taxation year if the total of all amounts, each of which is the specified portion, in relation to the eligible taxation year, of a qualifying amount received by the individual before the end of the year of receipt, were added in computing the individual’s taxable income for the eligible taxation year
(ii)the total of all amounts each of which is an amount, in respect of a qualifying amount received by the individual before the year of receipt, that was included because of this paragraph in computing the individual’s notional tax payable under this Part for the eligible taxation year, and
(i)for the period that began on May 1 of the year following the eligible taxation year and that ended immediately before the year of receipt, and(ii)at the prescribed rate that is applicable for the purpose of subsection 164(3) with respect to the period.
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]2000, c. 19, s. 302013, c. 34, s. 255
120.4(1)The definitions in this subsection apply in this section.arm’s length capitalarm’s length capital, of a specified individual, means property of the individual if the property, or property for which it is a substitute, was not(a)acquired as income from, or a taxable capital gain or profit from the disposition of, another property that was derived directly or indirectly from a related business in respect of the specified individual;(b)borrowed by the specified individual under a loan or other indebtedness; or(c)transferred, directly or indirectly by any means whatever, to the specified individual from a person who was related to the specified individual (other than as a consequence of the death of a person). (capital indépendant)excluded amountexcluded amount, in respect of an individual for a taxation year, means an amount that is the individual’s income for the year from, or the individual’s taxable capital gain or profit for the year from the disposition of, a property to the extent that the amount(a)if the individual has not attained the age of 24 years before the year, is from a property that was acquired by, or for the benefit of, the individual as a consequence of the death of a person who is(i)a parent of the individual, or(ii)any person, if the individual is(A)enrolled as a full-time student during the year at apost-secondary educational institution(as defined in subsection 146.1(1)), or(B)an individual in respect of whom an amount may be deducted under section 118.3 in computing a taxpayer’s tax payable under this Part for the year;(b)is from a property acquired by the individual under a transfer described in subsection 160(4);(c)is a taxable capital gain that arises because of subsection 70(5);(d)is a taxable capital gain for the year from the disposition by the individual of property that is, at the time of the disposition,qualified farm or fishing propertyorqualified small business corporation shares(as those terms are defined in subsection 110.6(1)), unless the amount would be deemed to be a dividend under subsection 120.4(4) or (5) if this definition were read without reference to this paragraph;(e)if the individual has attained the age of 17 years before the year, is(i)not derived directly or indirectly from a related business in respect of the individual for the year, or(ii)derived directly or indirectly from an excluded business of the individual for the year;(f)if the individual has attained the age of 17 years but not the age of 24 years before the year, is(i)a safe harbour capital return of the individual, or(ii)a reasonable return in respect of the individual, having regard only to the contributions of arm’s length capital by the individual; or(g)if the individual has attained the age of 24 years before the year, is(i)income from, or a taxable capital gain from the disposition of, excluded shares of the individual, or(ii)a reasonable return in respect of the individual. (montant exclu)excluded businessexcluded business, of a specified individual for a taxation year, means a business if the specified individual is actively engaged on a regular, continuous and substantial basis in the activities of the business in either(a)the taxation year, except in respect of an amount described in paragraph (e) of the definitionsplit income; or(b)any five prior taxation years of the specified individual. (entreprise exclue)excluded sharesexcluded shares, of a specified individual at any time, means shares of the capital stock of a corporation owned by the specified individual if(a)the following conditions are met:(i)less than 90% of the business income of the corporation for the last taxation year of the corporation that ends at or before that time (or, if no such taxation year exists, for the taxation year of the corporation that includes that time) was from the provision of services, and(ii)the corporation is not a professional corporation;(b)immediately before that time, the specified individual owns shares of the capital stock of the corporation that(i)give the holders thereof 10% or more of the votes that could be cast at an annual meeting of the shareholders of the corporation, and(ii)have a fair market value of 10% or more of the fair market value of all of the issued and outstanding shares of the capital stock of the corporation; and(c)all or substantially all of the income of the corporation for the relevant taxation year in subparagraph (a)(i) is income that is not derived, directly or indirectly, from one or more related businesses in respect of the specified individual other than a business of the corporation. (actions exclues)reasonable returnreasonable return, in respect of a specified individual for a taxation year, means a particular amount derived directly or indirectly from a related business in respect of the specified individual that(a)would, if this subsection were read without reference to subparagraph (f)(ii) or (g)(ii) of the definitionexcluded amount, be an amount described in the definitionsplit incomein respect of the specified individual for the year; and(b)is reasonable having regard to the following factors relating to the relative contributions of the specified individual, and each source individual in respect of the specified individual, in respect of the related business:(i)the work they performed in support of the related business,(ii)the property they contributed, directly or indirectly, in support of the related business,(iii)the risks they assumed in respect of the related business,(iv)the total of all amounts that were paid or that became payable, directly or indirectly, by any person or partnership to, or for the benefit of, them in respect of the related business, and(v)such other factors as may be relevant. (rendement raisonnable)related businessrelated business, in respect of a specified individual for a taxation year, means(a)a business carried on by(i)a source individual in respect of the specified individual at any time in the year, or(ii)a partnership, corporation or trust if a source individual in respect of the specified individual at any time in the year is actively engaged on a regular basis in the activities of the partnership, corporation or trust related to earning income from the business;(b)a business of a particular partnership, if a source individual in respect of the specified individual at any time in the year has an interest — including directly or indirectly — in the particular partnership; and(c)a business of a corporation, if the following conditions are met at any time in the year:(i)a source individual in respect of the specified individual owns(A)shares of the capital stock of the corporation, or(B)property that derives, directly or indirectly, all or part of its fair market value from shares of the capital stock of the corporation, and(ii)it is the case that0.1A ≤ B + CwhereAis the total fair market value of all of the issued and outstanding shares of the capital stock of the corporation,Bis the total fair market value of property described in clause (i)(A), andCis the portion of the total fair market value of property described in clause (i)(B) that is derived from shares of the capital stock of the corporation. (entreprise liée)safe harbour capital returnsafe harbour capital return, of a specified individual for a taxation year, means an amount that does not exceed the amount determined by the formulaA × BwhereAis the rate equal to the highest rate of interest prescribed under paragraph 4301(c) of theIncome Tax Regulationsin effect for a quarter in the year; andBis the total of all amounts each of which is determined by the formulaC × D/EwhereCis the fair market value of property contributed by the specified individual in support of a related business at the time it was contributed,Dis the number of days in the year that the property (or property substituted for it) is used in support of the related business and has not directly or indirectly, in any manner whatever, been returned to the specified individual, andEis the number of days in the year. (rendement exonéré)source individualsource individual, in respect of a specified individual for a taxation year, means an individual (other than a trust) who, at any time in the year, is(a)resident in Canada; and(b)related to the specified individual. (particulier source)specified individualspecified individual, for a taxation year, means an individual (other than a trust) who(a)is resident in Canada(i)in the case where the individual dies in the year, immediately before the death, and(ii)in any other case, at the end of the year; and(b)if the individual has not attained the age of 17 years before the year, has a parent resident in Canada at any time in the year. (particulier déterminé)split incomesplit income, of a specified individual for a taxation year, means the total of all amounts (other than excluded amounts) each of which is(a)an amount required to be included in computing the individual’s income for the year(i)in respect of taxable dividends received by the individual in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation), or(ii)because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),(b)a portion of an amount included because of the application of paragraph 96(1)(f) in computing the individual’s income for the year, to the extent that the portion(i)is not included in an amount described in paragraph (a), and(ii)can reasonably be considered to be income derived directly or indirectly from(A)one or more related businesses in respect of the individual for the year, or(B)the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year(I)is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property, or(II)in the case of a particular partnership, has an interest in the particular partnership directly or indirectly through one or more other partnerships,(c)a portion of an amount included because of the application of subsection 104(13) or 105(2) in respect of a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)) in computing the individual’s income for the year, to the extent that the portion(i)is not included in an amount described in paragraph (a), and(ii)can reasonably be considered(A)to be in respect of taxable dividends received in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation),(B)to arise because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),(C)to be income derived directly or indirectly from one or more related businesses in respect of the individual for the year, or(D)to be income derived from the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property,(d)an amount included in computing the individual’s income for the year to the extent that the amount is in respect of a debt obligation that(i)is of a corporation (other than a mutual fund corporation or a corporation shares of a class of the capital stock of which are listed on a designated stock exchange), partnership or trust (other than a mutual fund trust), and(ii)is not(A)described in paragraph (a) of the definitionfully exempt interestin subsection 212(3),(B)listed or traded on a public market, or(C)a deposit, standing to the credit of the individual,(I)within the meaning assigned by theCanada Deposit Insurance Corporation Act, or(II)with a credit union or a branch in Canada of a bank, and(e)an amount in respect of a property, to the extent that(i)the amount(A)is a taxable capital gain, or a profit, of the individual for the year from the disposition after 2017 of the property, or(B)is included under subsection 104(13) or 105(2) in computing the individual’s income for the year and can reasonably be considered to be attributable to a taxable capital gain, or a profit, of any person or partnership for the year from the disposition after 2017 of the property, and(ii)the property is(A)a share of the capital stock of a corporation (other than a share of a class listed on a designated stock exchange or a share of the capital stock of a mutual fund corporation), or(B)a property in respect of which the following conditions are met:(I)the property is1an interest in a partnership,2an interest as a beneficiary under a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)), or3a debt obligation (other than a debt obligation described in any of clauses (d)(ii)(A) to (C)), and(II)either1in respect of the property an amount is included in the individual’s split income for the year or an earlier taxation year, or2all or any part of the fair market value of the property, immediately before the disposition referred to in clause (i)(A) or (B), as the case may be, is derived, directly or indirectly, from a share described in clause (A). (revenu fractionné)Marginal note:Additional rules — specified individual(1.1)For the purpose of applying this section in respect of a specified individual in respect of a taxation year,(a)an individual is deemed to be actively engaged on a regular, continuous and substantial basis in the activities of a business in a taxation year of the individual if the individual works in the business at least an average of 20 hours per week during the portion of the year in which the business operates;(b)if an amount would — if this section were read without reference to this paragraph — be split income of a specified individual who has attained the age of 17 years before the year in respect of a property, and that property was acquired by, or for the benefit of, the specified individual as a consequence of the death of another person, then(i)for the purpose of applying paragraph (b) of the definitionreasonable returnin subsection (1), to the extent that the particular amount referred to in that paragraph is in respect of the property, then the factors referred to in that paragraph in respect of the other person are to be included for the purpose of determining a reasonable return in respect of the individual,(ii)for the purposes of this subparagraph and the definitionexcluded businessin subsection (1), if the other person was actively engaged on a regular, substantial and continuous basis in the activities of a business throughout five previous taxation years, then the individual is deemed to have been actively engaged on a regular, substantial and continuous basis in the business throughout those five years, and(iii)for the purpose of applying paragraph (g) of the definitionexcluded amountin subsection (1) in respect of that property, the individual is deemed to have attained the age of 24 years before the year if the other person had attained the age of 24 years before the year;(c)an amount that is a specified individual’s income for a taxation year from, or the specified individual’s taxable capital gain or profit for the year from the disposition of, a property is deemed to be an excluded amount in respect of the specified individual for the taxation year if(i)the following conditions are met:(A)the amount would be an excluded amount in respect of the specified individual’s spouse or common-law partner for the year, if the amount were included in computing the spouse or common-law partner’s income for the year, and(B)the spouse or common-law partner has attained the age of 64 years before the year, or(ii)the amount would have been an excluded amount in respect of an individual who was, immediately before their death, the specified individual’s spouse or common-law partner, if the amount were included in computing the spouse or common-law partner’s income for their last taxation year (determined as if this section applies in respect of that year);(d)for greater certainty, an amount derived directly or indirectly from a business includes(i)an amount that(A)is derived from the provision of property or services to, or in support of, the business, or(B)arises in connection with the ownership or disposition of an interest in the person or partnership carrying on the business, and(ii)an amount derived from an amount described in this paragraph; and(e)for the purposes of this section, an individual is deemed not to be related to their spouse or common-law partner at any time in a year if, at the end of the year, the individual is living separate and apart from their spouse or common-law partner because of a breakdown of their marriage or common-law partnership.Marginal note:Tax on split income(2)There shall be added to a specified individual’s tax payable under this Part for a taxation year the highest individual percentage for the year multiplied by the individual’s split income for the year.Marginal note:Tax payable by a specified individual(3)Notwithstanding any other provision of this Act, if an individual is a specified individual for a taxation year, the individual’s tax payable under this Part for the year shall not be less than the amount by which the amount added under subsection (2) to the individual’s tax payable under this Part for the year exceeds the amount determined by the formulaA + BwhereAis the amount deducted under section 118.3 in computing the individual’s tax payable under this Part for the year; andBis the total of all amounts each of which is the amount that(a)may be deducted under section 121 or 126 in computing the individual’s tax payable under this Part for the year, and(b)can reasonably be considered to be in respect of an amount included in computing the individual’s split income for the year.Marginal note:Taxable capital gain(4)If a specified individual who has not attained the age of 17 years before a taxation year would have for the taxation year, if this Act were read without reference to this section, a taxable capital gain (other than an excluded amount) from a disposition of shares (other than shares of a class listed on a designated stock exchange or shares of a mutual fund corporation) that are transferred, either directly or indirectly, in any manner whatever, to a person with whom the specified individual does not deal at arm’s length, then the amount of that taxable capital gain is deemed not to be a taxable capital gain and twice the amount is deemed to be received by the specified individual in the year as a taxable dividend that is not an eligible dividend.Marginal note:Taxable capital gain of trust(5)If a specified individual who has not attained the age of 17 years before a taxation year would be, if this Act were read without reference to this section, required under subsection 104(13) or 105(2) to include an amount in computing the specified individual’s income for the taxation year, then to the extent that the amount can reasonably be considered to be attributable to a taxable capital gain (other than an excluded amount) of a trust from a disposition of shares (other than shares of a class listed on a designated stock exchange or shares of a mutual fund corporation) that are transferred, either directly or indirectly, in any manner whatever, to a person with whom the specified individual does not deal at arm’s length, subsections 104(13) and 105(2) do not apply in respect of the amount and twice the amount is deemed to be received by the specified individual in the year as a taxable dividend that is not an eligible dividend.
(a)acquired as income from, or a taxable capital gain or profit from the disposition of, another property that was derived directly or indirectly from a related business in respect of the specified individual;(b)borrowed by the specified individual under a loan or other indebtedness; or(c)transferred, directly or indirectly by any means whatever, to the specified individual from a person who was related to the specified individual (other than as a consequence of the death of a person). (capital indépendant)
(a)if the individual has not attained the age of 24 years before the year, is from a property that was acquired by, or for the benefit of, the individual as a consequence of the death of a person who is(i)a parent of the individual, or(ii)any person, if the individual is(A)enrolled as a full-time student during the year at apost-secondary educational institution(as defined in subsection 146.1(1)), or(B)an individual in respect of whom an amount may be deducted under section 118.3 in computing a taxpayer’s tax payable under this Part for the year;(b)is from a property acquired by the individual under a transfer described in subsection 160(4);(c)is a taxable capital gain that arises because of subsection 70(5);(d)is a taxable capital gain for the year from the disposition by the individual of property that is, at the time of the disposition,qualified farm or fishing propertyorqualified small business corporation shares(as those terms are defined in subsection 110.6(1)), unless the amount would be deemed to be a dividend under subsection 120.4(4) or (5) if this definition were read without reference to this paragraph;(e)if the individual has attained the age of 17 years before the year, is(i)not derived directly or indirectly from a related business in respect of the individual for the year, or(ii)derived directly or indirectly from an excluded business of the individual for the year;(f)if the individual has attained the age of 17 years but not the age of 24 years before the year, is(i)a safe harbour capital return of the individual, or(ii)a reasonable return in respect of the individual, having regard only to the contributions of arm’s length capital by the individual; or(g)if the individual has attained the age of 24 years before the year, is(i)income from, or a taxable capital gain from the disposition of, excluded shares of the individual, or(ii)a reasonable return in respect of the individual. (montant exclu)
(i)a parent of the individual, or(ii)any person, if the individual is(A)enrolled as a full-time student during the year at apost-secondary educational institution(as defined in subsection 146.1(1)), or(B)an individual in respect of whom an amount may be deducted under section 118.3 in computing a taxpayer’s tax payable under this Part for the year;
(A)enrolled as a full-time student during the year at apost-secondary educational institution(as defined in subsection 146.1(1)), or(B)an individual in respect of whom an amount may be deducted under section 118.3 in computing a taxpayer’s tax payable under this Part for the year;
(i)not derived directly or indirectly from a related business in respect of the individual for the year, or(ii)derived directly or indirectly from an excluded business of the individual for the year;
(i)a safe harbour capital return of the individual, or(ii)a reasonable return in respect of the individual, having regard only to the contributions of arm’s length capital by the individual; or
(i)income from, or a taxable capital gain from the disposition of, excluded shares of the individual, or(ii)a reasonable return in respect of the individual. (montant exclu)
(a)the taxation year, except in respect of an amount described in paragraph (e) of the definitionsplit income; or(b)any five prior taxation years of the specified individual. (entreprise exclue)
(a)the following conditions are met:(i)less than 90% of the business income of the corporation for the last taxation year of the corporation that ends at or before that time (or, if no such taxation year exists, for the taxation year of the corporation that includes that time) was from the provision of services, and(ii)the corporation is not a professional corporation;(b)immediately before that time, the specified individual owns shares of the capital stock of the corporation that(i)give the holders thereof 10% or more of the votes that could be cast at an annual meeting of the shareholders of the corporation, and(ii)have a fair market value of 10% or more of the fair market value of all of the issued and outstanding shares of the capital stock of the corporation; and(c)all or substantially all of the income of the corporation for the relevant taxation year in subparagraph (a)(i) is income that is not derived, directly or indirectly, from one or more related businesses in respect of the specified individual other than a business of the corporation. (actions exclues)
(i)less than 90% of the business income of the corporation for the last taxation year of the corporation that ends at or before that time (or, if no such taxation year exists, for the taxation year of the corporation that includes that time) was from the provision of services, and(ii)the corporation is not a professional corporation;
(i)give the holders thereof 10% or more of the votes that could be cast at an annual meeting of the shareholders of the corporation, and(ii)have a fair market value of 10% or more of the fair market value of all of the issued and outstanding shares of the capital stock of the corporation; and
(a)would, if this subsection were read without reference to subparagraph (f)(ii) or (g)(ii) of the definitionexcluded amount, be an amount described in the definitionsplit incomein respect of the specified individual for the year; and(b)is reasonable having regard to the following factors relating to the relative contributions of the specified individual, and each source individual in respect of the specified individual, in respect of the related business:(i)the work they performed in support of the related business,(ii)the property they contributed, directly or indirectly, in support of the related business,(iii)the risks they assumed in respect of the related business,(iv)the total of all amounts that were paid or that became payable, directly or indirectly, by any person or partnership to, or for the benefit of, them in respect of the related business, and(v)such other factors as may be relevant. (rendement raisonnable)
(i)the work they performed in support of the related business,(ii)the property they contributed, directly or indirectly, in support of the related business,(iii)the risks they assumed in respect of the related business,(iv)the total of all amounts that were paid or that became payable, directly or indirectly, by any person or partnership to, or for the benefit of, them in respect of the related business, and(v)such other factors as may be relevant. (rendement raisonnable)
(a)a business carried on by(i)a source individual in respect of the specified individual at any time in the year, or(ii)a partnership, corporation or trust if a source individual in respect of the specified individual at any time in the year is actively engaged on a regular basis in the activities of the partnership, corporation or trust related to earning income from the business;(b)a business of a particular partnership, if a source individual in respect of the specified individual at any time in the year has an interest — including directly or indirectly — in the particular partnership; and(c)a business of a corporation, if the following conditions are met at any time in the year:(i)a source individual in respect of the specified individual owns(A)shares of the capital stock of the corporation, or(B)property that derives, directly or indirectly, all or part of its fair market value from shares of the capital stock of the corporation, and(ii)it is the case that0.1A ≤ B + CwhereAis the total fair market value of all of the issued and outstanding shares of the capital stock of the corporation,Bis the total fair market value of property described in clause (i)(A), andCis the portion of the total fair market value of property described in clause (i)(B) that is derived from shares of the capital stock of the corporation. (entreprise liée)
(i)a source individual in respect of the specified individual at any time in the year, or(ii)a partnership, corporation or trust if a source individual in respect of the specified individual at any time in the year is actively engaged on a regular basis in the activities of the partnership, corporation or trust related to earning income from the business;
(i)a source individual in respect of the specified individual owns(A)shares of the capital stock of the corporation, or(B)property that derives, directly or indirectly, all or part of its fair market value from shares of the capital stock of the corporation, and(ii)it is the case that0.1A ≤ B + CwhereAis the total fair market value of all of the issued and outstanding shares of the capital stock of the corporation,Bis the total fair market value of property described in clause (i)(A), andCis the portion of the total fair market value of property described in clause (i)(B) that is derived from shares of the capital stock of the corporation. (entreprise liée)
(A)shares of the capital stock of the corporation, or(B)property that derives, directly or indirectly, all or part of its fair market value from shares of the capital stock of the corporation, and
(a)resident in Canada; and(b)related to the specified individual. (particulier source)
(a)is resident in Canada(i)in the case where the individual dies in the year, immediately before the death, and(ii)in any other case, at the end of the year; and(b)if the individual has not attained the age of 17 years before the year, has a parent resident in Canada at any time in the year. (particulier déterminé)
(i)in the case where the individual dies in the year, immediately before the death, and(ii)in any other case, at the end of the year; and
(a)an amount required to be included in computing the individual’s income for the year(i)in respect of taxable dividends received by the individual in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation), or(ii)because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),(b)a portion of an amount included because of the application of paragraph 96(1)(f) in computing the individual’s income for the year, to the extent that the portion(i)is not included in an amount described in paragraph (a), and(ii)can reasonably be considered to be income derived directly or indirectly from(A)one or more related businesses in respect of the individual for the year, or(B)the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year(I)is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property, or(II)in the case of a particular partnership, has an interest in the particular partnership directly or indirectly through one or more other partnerships,(c)a portion of an amount included because of the application of subsection 104(13) or 105(2) in respect of a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)) in computing the individual’s income for the year, to the extent that the portion(i)is not included in an amount described in paragraph (a), and(ii)can reasonably be considered(A)to be in respect of taxable dividends received in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation),(B)to arise because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),(C)to be income derived directly or indirectly from one or more related businesses in respect of the individual for the year, or(D)to be income derived from the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property,(d)an amount included in computing the individual’s income for the year to the extent that the amount is in respect of a debt obligation that(i)is of a corporation (other than a mutual fund corporation or a corporation shares of a class of the capital stock of which are listed on a designated stock exchange), partnership or trust (other than a mutual fund trust), and(ii)is not(A)described in paragraph (a) of the definitionfully exempt interestin subsection 212(3),(B)listed or traded on a public market, or(C)a deposit, standing to the credit of the individual,(I)within the meaning assigned by theCanada Deposit Insurance Corporation Act, or(II)with a credit union or a branch in Canada of a bank, and(e)an amount in respect of a property, to the extent that(i)the amount(A)is a taxable capital gain, or a profit, of the individual for the year from the disposition after 2017 of the property, or(B)is included under subsection 104(13) or 105(2) in computing the individual’s income for the year and can reasonably be considered to be attributable to a taxable capital gain, or a profit, of any person or partnership for the year from the disposition after 2017 of the property, and(ii)the property is(A)a share of the capital stock of a corporation (other than a share of a class listed on a designated stock exchange or a share of the capital stock of a mutual fund corporation), or(B)a property in respect of which the following conditions are met:(I)the property is1an interest in a partnership,2an interest as a beneficiary under a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)), or3a debt obligation (other than a debt obligation described in any of clauses (d)(ii)(A) to (C)), and(II)either1in respect of the property an amount is included in the individual’s split income for the year or an earlier taxation year, or2all or any part of the fair market value of the property, immediately before the disposition referred to in clause (i)(A) or (B), as the case may be, is derived, directly or indirectly, from a share described in clause (A). (revenu fractionné)
(i)in respect of taxable dividends received by the individual in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation), or(ii)because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),
(i)is not included in an amount described in paragraph (a), and(ii)can reasonably be considered to be income derived directly or indirectly from(A)one or more related businesses in respect of the individual for the year, or(B)the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year(I)is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property, or(II)in the case of a particular partnership, has an interest in the particular partnership directly or indirectly through one or more other partnerships,
(A)one or more related businesses in respect of the individual for the year, or(B)the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year(I)is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property, or(II)in the case of a particular partnership, has an interest in the particular partnership directly or indirectly through one or more other partnerships,
(I)is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property, or(II)in the case of a particular partnership, has an interest in the particular partnership directly or indirectly through one or more other partnerships,
(i)is not included in an amount described in paragraph (a), and(ii)can reasonably be considered(A)to be in respect of taxable dividends received in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation),(B)to arise because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),(C)to be income derived directly or indirectly from one or more related businesses in respect of the individual for the year, or(D)to be income derived from the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property,
(A)to be in respect of taxable dividends received in respect of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange or shares of the capital stock of a mutual fund corporation),(B)to arise because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a designated stock exchange),(C)to be income derived directly or indirectly from one or more related businesses in respect of the individual for the year, or(D)to be income derived from the rental of property by a particular partnership or trust, if a person who is related to the individual at any time in the year is actively engaged on a regular basis in the activities of the particular partnership or trust related to the rental of property,
(i)is of a corporation (other than a mutual fund corporation or a corporation shares of a class of the capital stock of which are listed on a designated stock exchange), partnership or trust (other than a mutual fund trust), and(ii)is not(A)described in paragraph (a) of the definitionfully exempt interestin subsection 212(3),(B)listed or traded on a public market, or(C)a deposit, standing to the credit of the individual,(I)within the meaning assigned by theCanada Deposit Insurance Corporation Act, or(II)with a credit union or a branch in Canada of a bank, and
(A)described in paragraph (a) of the definitionfully exempt interestin subsection 212(3),(B)listed or traded on a public market, or(C)a deposit, standing to the credit of the individual,(I)within the meaning assigned by theCanada Deposit Insurance Corporation Act, or(II)with a credit union or a branch in Canada of a bank, and
(I)within the meaning assigned by theCanada Deposit Insurance Corporation Act, or(II)with a credit union or a branch in Canada of a bank, and
(i)the amount(A)is a taxable capital gain, or a profit, of the individual for the year from the disposition after 2017 of the property, or(B)is included under subsection 104(13) or 105(2) in computing the individual’s income for the year and can reasonably be considered to be attributable to a taxable capital gain, or a profit, of any person or partnership for the year from the disposition after 2017 of the property, and(ii)the property is(A)a share of the capital stock of a corporation (other than a share of a class listed on a designated stock exchange or a share of the capital stock of a mutual fund corporation), or(B)a property in respect of which the following conditions are met:(I)the property is1an interest in a partnership,2an interest as a beneficiary under a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)), or3a debt obligation (other than a debt obligation described in any of clauses (d)(ii)(A) to (C)), and(II)either1in respect of the property an amount is included in the individual’s split income for the year or an earlier taxation year, or2all or any part of the fair market value of the property, immediately before the disposition referred to in clause (i)(A) or (B), as the case may be, is derived, directly or indirectly, from a share described in clause (A). (revenu fractionné)
(A)is a taxable capital gain, or a profit, of the individual for the year from the disposition after 2017 of the property, or(B)is included under subsection 104(13) or 105(2) in computing the individual’s income for the year and can reasonably be considered to be attributable to a taxable capital gain, or a profit, of any person or partnership for the year from the disposition after 2017 of the property, and
(A)a share of the capital stock of a corporation (other than a share of a class listed on a designated stock exchange or a share of the capital stock of a mutual fund corporation), or(B)a property in respect of which the following conditions are met:(I)the property is1an interest in a partnership,2an interest as a beneficiary under a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)), or3a debt obligation (other than a debt obligation described in any of clauses (d)(ii)(A) to (C)), and(II)either1in respect of the property an amount is included in the individual’s split income for the year or an earlier taxation year, or2all or any part of the fair market value of the property, immediately before the disposition referred to in clause (i)(A) or (B), as the case may be, is derived, directly or indirectly, from a share described in clause (A). (revenu fractionné)
(I)the property is1an interest in a partnership,2an interest as a beneficiary under a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)), or3a debt obligation (other than a debt obligation described in any of clauses (d)(ii)(A) to (C)), and(II)either1in respect of the property an amount is included in the individual’s split income for the year or an earlier taxation year, or2all or any part of the fair market value of the property, immediately before the disposition referred to in clause (i)(A) or (B), as the case may be, is derived, directly or indirectly, from a share described in clause (A). (revenu fractionné)
(a)an individual is deemed to be actively engaged on a regular, continuous and substantial basis in the activities of a business in a taxation year of the individual if the individual works in the business at least an average of 20 hours per week during the portion of the year in which the business operates;(b)if an amount would — if this section were read without reference to this paragraph — be split income of a specified individual who has attained the age of 17 years before the year in respect of a property, and that property was acquired by, or for the benefit of, the specified individual as a consequence of the death of another person, then(i)for the purpose of applying paragraph (b) of the definitionreasonable returnin subsection (1), to the extent that the particular amount referred to in that paragraph is in respect of the property, then the factors referred to in that paragraph in respect of the other person are to be included for the purpose of determining a reasonable return in respect of the individual,(ii)for the purposes of this subparagraph and the definitionexcluded businessin subsection (1), if the other person was actively engaged on a regular, substantial and continuous basis in the activities of a business throughout five previous taxation years, then the individual is deemed to have been actively engaged on a regular, substantial and continuous basis in the business throughout those five years, and(iii)for the purpose of applying paragraph (g) of the definitionexcluded amountin subsection (1) in respect of that property, the individual is deemed to have attained the age of 24 years before the year if the other person had attained the age of 24 years before the year;(c)an amount that is a specified individual’s income for a taxation year from, or the specified individual’s taxable capital gain or profit for the year from the disposition of, a property is deemed to be an excluded amount in respect of the specified individual for the taxation year if(i)the following conditions are met:(A)the amount would be an excluded amount in respect of the specified individual’s spouse or common-law partner for the year, if the amount were included in computing the spouse or common-law partner’s income for the year, and(B)the spouse or common-law partner has attained the age of 64 years before the year, or(ii)the amount would have been an excluded amount in respect of an individual who was, immediately before their death, the specified individual’s spouse or common-law partner, if the amount were included in computing the spouse or common-law partner’s income for their last taxation year (determined as if this section applies in respect of that year);(d)for greater certainty, an amount derived directly or indirectly from a business includes(i)an amount that(A)is derived from the provision of property or services to, or in support of, the business, or(B)arises in connection with the ownership or disposition of an interest in the person or partnership carrying on the business, and(ii)an amount derived from an amount described in this paragraph; and(e)for the purposes of this section, an individual is deemed not to be related to their spouse or common-law partner at any time in a year if, at the end of the year, the individual is living separate and apart from their spouse or common-law partner because of a breakdown of their marriage or common-law partnership.
(i)for the purpose of applying paragraph (b) of the definitionreasonable returnin subsection (1), to the extent that the particular amount referred to in that paragraph is in respect of the property, then the factors referred to in that paragraph in respect of the other person are to be included for the purpose of determining a reasonable return in respect of the individual,(ii)for the purposes of this subparagraph and the definitionexcluded businessin subsection (1), if the other person was actively engaged on a regular, substantial and continuous basis in the activities of a business throughout five previous taxation years, then the individual is deemed to have been actively engaged on a regular, substantial and continuous basis in the business throughout those five years, and(iii)for the purpose of applying paragraph (g) of the definitionexcluded amountin subsection (1) in respect of that property, the individual is deemed to have attained the age of 24 years before the year if the other person had attained the age of 24 years before the year;
(i)the following conditions are met:(A)the amount would be an excluded amount in respect of the specified individual’s spouse or common-law partner for the year, if the amount were included in computing the spouse or common-law partner’s income for the year, and(B)the spouse or common-law partner has attained the age of 64 years before the year, or(ii)the amount would have been an excluded amount in respect of an individual who was, immediately before their death, the specified individual’s spouse or common-law partner, if the amount were included in computing the spouse or common-law partner’s income for their last taxation year (determined as if this section applies in respect of that year);
(A)the amount would be an excluded amount in respect of the specified individual’s spouse or common-law partner for the year, if the amount were included in computing the spouse or common-law partner’s income for the year, and(B)the spouse or common-law partner has attained the age of 64 years before the year, or
(i)an amount that(A)is derived from the provision of property or services to, or in support of, the business, or(B)arises in connection with the ownership or disposition of an interest in the person or partnership carrying on the business, and(ii)an amount derived from an amount described in this paragraph; and
(A)is derived from the provision of property or services to, or in support of, the business, or(B)arises in connection with the ownership or disposition of an interest in the person or partnership carrying on the business, and
(a)may be deducted under section 121 or 126 in computing the individual’s tax payable under this Part for the year, and(b)can reasonably be considered to be in respect of an amount included in computing the individual’s split income for the year.
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]2000, c. 19, s. 302007, c. 35, s. 682011, c. 24, s. 362013, c. 34, s. 256(E)2014, c. 39, s. 372016, c. 11, s. 42018, c. 12, s. 13
(a)the product of the amount, if any, that is required by subparagraph 82(1)(b)(i) to be included in computing the individual’s income for the year multiplied by(i)for the 2018 taxation year, 8/11, and(ii)for taxation years after 2018, 9/13, and(b)the product of the amount, if any, that is required by subparagraph 82(1)(b)(ii) to be included in computing the individual’s income for the year multiplied by(i)for the 2009 taxation year, 11/18,(ii)for the 2010 taxation year, 10/17,(iii)for the 2011 taxation year, 13/23, and(iv)for taxation years after 2011, 6/11.
(i)for the 2018 taxation year, 8/11, and(ii)for taxation years after 2018, 9/13, and
(i)for the 2009 taxation year, 11/18,(ii)for the 2010 taxation year, 10/17,(iii)for the 2011 taxation year, 13/23, and(iv)for taxation years after 2011, 6/11.
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]R.S., 1985, c. 1 (5th Supp.), s. 1212007, c. 2, s. 482008, c. 28, s. 172013, c. 33, s. 112015, c. 36, s. 102016, c. 7, s. 262018, c. 12, s. 14
122(1)Notwithstanding section 117, the tax payable under this Part for a taxation year by a trust (other than a graduated rate estate or qualified disability trust) is the total of(a)the highest individual percentage for the taxation year multiplied by the trust’s amount taxable for the taxation year,(b)if the trust is a SIFT trust for the taxation year, the positive or negative amount determined by the formulaA × BwhereAis the positive or negative decimal fraction determined by the formulaC + D - EwhereCis the net corporate income tax rate in respect of the SIFT trust for the taxation year,Dis the provincial SIFT tax rate of the SIFT trust for the taxation year, andEis the decimal fraction equivalent of the percentage rate of tax provided in paragraph (a) for the taxation year, andBis the SIFT trust’s taxable SIFT trust distributions for the taxation year, and(c)if subsection (2) applies to the trust for the taxation year, the amount determined by the formulaA − (B − C)whereAis the amount that would be determined for B for the year if(i)the rate of tax payable under this Part by the trust for each taxation year referred to in the description of B were the highest individual percentage for the taxation year, and(ii)the trust’s taxable income for a particular taxation year referred to in the description of B were reduced by the total of(A)the amount, if any, that was paid or distributed in satisfaction of all or part of an individual’s interest as a beneficiary under the trust if(I)the individual was an electing beneficiary of the trust for the particular year,(II)the payment or distribution can reasonably be considered to be made out of that taxable income, and(III)the payment or distribution was made in a taxation year referred to in the description of B,(B)the amount that is the portion of the tax payable under this Part by the trust for the particular year that can reasonably be considered to relate to the amount determined under clause (A), and(C)the amount that is the portion of the tax payable, under the law of the province in which the trust is resident for the particular year, that can reasonably be considered to relate to the amount determined under clause (A),Bis the total of all amounts each of which is the amount of tax payable under this Part by the trust for a taxation year that precedes the year if that preceding taxation year is(i)the later of(A)the first taxation year for which the trust was a qualified disability trust, and(B)the last taxation year, if any, for which subsection (2) applied to the trust, or(ii)a taxation year that ends after the taxation year described in subparagraph (i), andCis the total of all amounts each of which is an amount determined for clause (ii)(B) of the description of A in determining the amount for A for the year.Marginal note:Credits available to trusts(1.1)No deduction may be made under this Subdivision (other than section 118.1, 120.2 or 121) in computing the tax payable by a trust for a taxation year.Marginal note:Qualified disability trust — application of (1)(c)(2)This subsection applies to a trust for a particular taxation year if the trust was a qualified disability trust for a preceding taxation year and(a)none of the beneficiaries under the trust at the end of the particular year was an electing beneficiary of the trust for a preceding year;(b)the particular year ended immediately before the trust ceased to be resident in Canada; or(c)an amount is paid or distributed in the particular year to a beneficiary under the trust in satisfaction of all or part of the beneficiary’s interest in the trust unless(i)the beneficiary is an electing beneficiary of the trust for the particular year or a preceding year,(ii)the amount is deducted under paragraph 104(6)(b) in computing the trust’s income for the particular year, or(iii)the amount is paid or distributed in satisfaction of a right to enforce payment of an amount that was deducted under paragraph 104(6)(b) in computing the trust’s income for a preceding year.Marginal note:Definitions(3)The following definitions apply in this section.beneficiarybeneficiary, under a trust, includes a person beneficially interested in the trust. (bénéficiaire)electing beneficiaryelecting beneficiary, for a taxation year of a qualified disability trust, means a beneficiary under the trust that for the year(a)makes an election described in clause (a)(iii)(A) of the definitionqualified disability trustin this subsection; and(b)is described in paragraph (b) of that definition. (bénéficiaire optant)non-deductible distributions amountnon-deductible distributions amountfor a taxation year has the meaning assigned by subsection 104(16). (montant de distribution non déductible)qualified disability trustqualified disability trust, for a taxation year (in this definition referred to as the “trust year”), means a trust, if(a)the trust(i)is, at the end of the trust year, a testamentary trust that arose on and as a consequence of a particular individual’s death,(ii)is resident in Canada for the trust year, and(iii)includes in its return of income under this Part for the trust year(A)an election, made jointly with one or more beneficiaries under the trust in prescribed form, to be a qualified disability trust for the trust year, and(B)the Social Insurance Number of each of those beneficiaries;(b)each of those beneficiaries is an individual, named as a beneficiary by the particular individual in the instrument under which the trust was created,(i)in respect of whom paragraphs 118.3(1)(a) to (b) apply for the individual’s taxation year (in this definition referred to as the “beneficiary year”) in which the trust year ends, and(ii)who does not jointly elect with any other trust, for a taxation year of the other trust that ends in the beneficiary year, to be a qualified disability trust; and(c)subsection (2) does not apply to the trust for the trust year. (fiducie admissible pour personne handicapée)taxable SIFT trust distributionstaxable SIFT trust distributions, of a SIFT trust for a taxation year, means the lesser of(a)its amount taxable for the taxation year, and(b)the amount determined by the formulaA/(1 - (B + C))whereAis its non-deductible distributions amount for the taxation year,Bis the net corporate income tax rate in respect of the SIFT trust for the taxation year, andCis the provincial SIFT tax rate of the SIFT trust for the taxation year. (montant de distribution imposable)
(a)the highest individual percentage for the taxation year multiplied by the trust’s amount taxable for the taxation year,(b)if the trust is a SIFT trust for the taxation year, the positive or negative amount determined by the formulaA × BwhereAis the positive or negative decimal fraction determined by the formulaC + D - EwhereCis the net corporate income tax rate in respect of the SIFT trust for the taxation year,Dis the provincial SIFT tax rate of the SIFT trust for the taxation year, andEis the decimal fraction equivalent of the percentage rate of tax provided in paragraph (a) for the taxation year, andBis the SIFT trust’s taxable SIFT trust distributions for the taxation year, and(c)if subsection (2) applies to the trust for the taxation year, the amount determined by the formulaA − (B − C)whereAis the amount that would be determined for B for the year if(i)the rate of tax payable under this Part by the trust for each taxation year referred to in the description of B were the highest individual percentage for the taxation year, and(ii)the trust’s taxable income for a particular taxation year referred to in the description of B were reduced by the total of(A)the amount, if any, that was paid or distributed in satisfaction of all or part of an individual’s interest as a beneficiary under the trust if(I)the individual was an electing beneficiary of the trust for the particular year,(II)the payment or distribution can reasonably be considered to be made out of that taxable income, and(III)the payment or distribution was made in a taxation year referred to in the description of B,(B)the amount that is the portion of the tax payable under this Part by the trust for the particular year that can reasonably be considered to relate to the amount determined under clause (A), and(C)the amount that is the portion of the tax payable, under the law of the province in which the trust is resident for the particular year, that can reasonably be considered to relate to the amount determined under clause (A),Bis the total of all amounts each of which is the amount of tax payable under this Part by the trust for a taxation year that precedes the year if that preceding taxation year is(i)the later of(A)the first taxation year for which the trust was a qualified disability trust, and(B)the last taxation year, if any, for which subsection (2) applied to the trust, or(ii)a taxation year that ends after the taxation year described in subparagraph (i), andCis the total of all amounts each of which is an amount determined for clause (ii)(B) of the description of A in determining the amount for A for the year.
(i)the rate of tax payable under this Part by the trust for each taxation year referred to in the description of B were the highest individual percentage for the taxation year, and(ii)the trust’s taxable income for a particular taxation year referred to in the description of B were reduced by the total of(A)the amount, if any, that was paid or distributed in satisfaction of all or part of an individual’s interest as a beneficiary under the trust if(I)the individual was an electing beneficiary of the trust for the particular year,(II)the payment or distribution can reasonably be considered to be made out of that taxable income, and(III)the payment or distribution was made in a taxation year referred to in the description of B,(B)the amount that is the portion of the tax payable under this Part by the trust for the particular year that can reasonably be considered to relate to the amount determined under clause (A), and(C)the amount that is the portion of the tax payable, under the law of the province in which the trust is resident for the particular year, that can reasonably be considered to relate to the amount determined under clause (A),
(A)the amount, if any, that was paid or distributed in satisfaction of all or part of an individual’s interest as a beneficiary under the trust if(I)the individual was an electing beneficiary of the trust for the particular year,(II)the payment or distribution can reasonably be considered to be made out of that taxable income, and(III)the payment or distribution was made in a taxation year referred to in the description of B,(B)the amount that is the portion of the tax payable under this Part by the trust for the particular year that can reasonably be considered to relate to the amount determined under clause (A), and(C)the amount that is the portion of the tax payable, under the law of the province in which the trust is resident for the particular year, that can reasonably be considered to relate to the amount determined under clause (A),
(I)the individual was an electing beneficiary of the trust for the particular year,(II)the payment or distribution can reasonably be considered to be made out of that taxable income, and(III)the payment or distribution was made in a taxation year referred to in the description of B,
(i)the later of(A)the first taxation year for which the trust was a qualified disability trust, and(B)the last taxation year, if any, for which subsection (2) applied to the trust, or(ii)a taxation year that ends after the taxation year described in subparagraph (i), and
(A)the first taxation year for which the trust was a qualified disability trust, and(B)the last taxation year, if any, for which subsection (2) applied to the trust, or
(a)none of the beneficiaries under the trust at the end of the particular year was an electing beneficiary of the trust for a preceding year;(b)the particular year ended immediately before the trust ceased to be resident in Canada; or(c)an amount is paid or distributed in the particular year to a beneficiary under the trust in satisfaction of all or part of the beneficiary’s interest in the trust unless(i)the beneficiary is an electing beneficiary of the trust for the particular year or a preceding year,(ii)the amount is deducted under paragraph 104(6)(b) in computing the trust’s income for the particular year, or(iii)the amount is paid or distributed in satisfaction of a right to enforce payment of an amount that was deducted under paragraph 104(6)(b) in computing the trust’s income for a preceding year.
(i)the beneficiary is an electing beneficiary of the trust for the particular year or a preceding year,(ii)the amount is deducted under paragraph 104(6)(b) in computing the trust’s income for the particular year, or(iii)the amount is paid or distributed in satisfaction of a right to enforce payment of an amount that was deducted under paragraph 104(6)(b) in computing the trust’s income for a preceding year.
(a)makes an election described in clause (a)(iii)(A) of the definitionqualified disability trustin this subsection; and(b)is described in paragraph (b) of that definition. (bénéficiaire optant)
(a)the trust(i)is, at the end of the trust year, a testamentary trust that arose on and as a consequence of a particular individual’s death,(ii)is resident in Canada for the trust year, and(iii)includes in its return of income under this Part for the trust year(A)an election, made jointly with one or more beneficiaries under the trust in prescribed form, to be a qualified disability trust for the trust year, and(B)the Social Insurance Number of each of those beneficiaries;(b)each of those beneficiaries is an individual, named as a beneficiary by the particular individual in the instrument under which the trust was created,(i)in respect of whom paragraphs 118.3(1)(a) to (b) apply for the individual’s taxation year (in this definition referred to as the “beneficiary year”) in which the trust year ends, and(ii)who does not jointly elect with any other trust, for a taxation year of the other trust that ends in the beneficiary year, to be a qualified disability trust; and(c)subsection (2) does not apply to the trust for the trust year. (fiducie admissible pour personne handicapée)
(i)is, at the end of the trust year, a testamentary trust that arose on and as a consequence of a particular individual’s death,(ii)is resident in Canada for the trust year, and(iii)includes in its return of income under this Part for the trust year(A)an election, made jointly with one or more beneficiaries under the trust in prescribed form, to be a qualified disability trust for the trust year, and(B)the Social Insurance Number of each of those beneficiaries;
(A)an election, made jointly with one or more beneficiaries under the trust in prescribed form, to be a qualified disability trust for the trust year, and(B)the Social Insurance Number of each of those beneficiaries;
(i)in respect of whom paragraphs 118.3(1)(a) to (b) apply for the individual’s taxation year (in this definition referred to as the “beneficiary year”) in which the trust year ends, and(ii)who does not jointly elect with any other trust, for a taxation year of the other trust that ends in the beneficiary year, to be a qualified disability trust; and
(a)its amount taxable for the taxation year, and(b)the amount determined by the formulaA/(1 - (B + C))whereAis its non-deductible distributions amount for the taxation year,Bis the net corporate income tax rate in respect of the SIFT trust for the taxation year, andCis the provincial SIFT tax rate of the SIFT trust for the taxation year. (montant de distribution imposable)
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]R.S., 1985, c. 1 (5th Supp.), s. 1222001, c. 17, s. 1052007, c. 29, s. 122008, c. 28, s. 182013, c. 34, ss. 13, 2572014, c. 39, s. 382016, c. 7, s. 62, c. 11, s. 52017, c. 33, s. 46
122.1(1)The following definitions apply in this section and in sections 104 and 122.eligible resale propertyeligible resale property, of an entity, means real or immovable property (other than capital property) of the entity(a)that is contiguous to a particular real or immovable property that is capital property or eligible resale property, held by(i)the entity, or(ii)another entity affiliated with the entity; and(b)the holding of which is ancillary to the holding of the particular property. (bien de revente admissible)entityentitymeans a corporation, trust or partnership. (entité)equityequity, of an entity, means(a)if the entity is a corporation, a share of the capital stock of the corporation;(b)if the entity is a trust, an income or capital interest in the trust;(c)if the entity is a partnership, an interest as a member of the partnership;(d)a liability of the entity (and, for purposes of the definitionpublicly-traded liabilityin this section, a security of the entity that is a liability of another entity) if(i)the liability is convertible into, or exchangeable for, equity of the entity or of another entity, or(ii)any amount paid or payable in respect of the liability is contingent or dependent on the use of or production from property, or is computed by reference to revenue, profit, cash flow, commodity price or any other similar criterion or by reference to dividends paid or payable to shareholders of any class of shares of the capital stock of a corporation, or to income or capital paid or payable to any member of a partnership or beneficiary under a trust; and(e)a right to, or to acquire, anything described in this paragraph and any of paragraphs (a) to (d). (capitaux propres)equity valueequity value, of an entity at any time, means the total fair market value at that time of(a)if the entity is a corporation, all of the issued and outstanding shares of the capital stock of the corporation;(b)if the entity is a trust, all of the income or capital interests in the trust; or(c)if the entity is a partnership, all of the interests in the partnership. (valeur des capitaux propres)excluded subsidiary entityexcluded subsidiary entity, for a taxation year, means an entity none of the equity of which is at any time in the taxation year(a)listed or traded on a stock exchange or other public market; nor(b)held by any person or partnership other than(i)a real estate investment trust,(ii)a taxable Canadian corporation,(iii)a SIFT trust (determined without reference to subsection (2)),(iv)a SIFT partnership (determined without reference to subsection 197(8)),(v)a person or partnership that does not have, in connection with the holding of a security of the entity, property the value of which is determined, all or in part, by reference to a security that is listed or traded on a stock exchange or other public market, or(vi)an excluded subsidiary entity for the taxation year. (filiale exclue)gross REIT revenuegross REIT revenue, of an entity for a taxation year, means the amount, if any, by which the total of all amounts received or receivable in the year (depending on the method regularly followed by the entity in computing the entity’s income) by the entity exceeds the total of all amounts each of which is the cost to the entity of a property disposed of in the year. (revenu brut de FPI)investmentinvestment, in a trust or partnership,(a)means(i)a property that is a security of the trust or partnership, or(ii)a right which may reasonably be considered to replicate a return on, or the value of, a security of the trust or partnership; but(b)does not include(i)an unaffiliated publicly-traded liability of the trust or partnership, nor(ii)regulated innovative capital. (placement)non-portfolio earningsnon-portfolio earnings, of a SIFT trust for a taxation year, means the total of(a)the amount, if any, by which(i)the total of all amounts each of which is the SIFT trust’s income for the taxation year from a business carried on by it in Canada or from a non-portfolio property, other than income that is a taxable dividend received by the SIFT trust,exceeds(ii)the total of all amounts each of which is the SIFT trust’s loss for the taxation year from a business carried on by it in Canada or from a non-portfolio property, and(b)the amount, if any, by which(i)the total of(A)all taxable capital gains of the SIFT trust from dispositions of non-portfolio properties during the taxation year, and(B)one-half of the total of all amounts each of which is deemed under subsection 131(1) to be a capital gain of the SIFT trust for the taxation year in respect of a non-portfolio property of the SIFT trust for the taxation yearexceeds(ii)the total of the allowable capital losses of the SIFT trust for the taxation year from dispositions of non-portfolio properties during the taxation year. (gains hors portefeuille)non-portfolio propertynon-portfolio property, of a particular entity for a taxation year, means a property, held by the particular entity at any time in the taxation year, that is(a)a security of a subject entity (other than a portfolio investment entity), if at that time the particular entity holds(i)securities of the subject entity that have a total fair market value that is greater than 10% of the equity value of the subject entity, or(ii)securities of the subject entity that, together with all the securities that the particular entity holds of entities affiliated with the subject entity, have a total fair market value that is greater than 50% of the equity value of the particular entity;(b)a Canadian real, immovable or resource property, if at any time in the taxation year the total fair market value of all properties held by the particular entity that are Canadian real, immovable or resource properties is greater than 50% of the equity value of the particular entity; or(c)a property that the particular entity, or a person or partnership with whom the particular entity does not deal at arm’s length, uses at that time in the course of carrying on a business in Canada. (bien hors portefeuille)portfolio investment entityportfolio investment entityat any time means an entity that does not at that time hold any non-portfolio property. (entité de placement de portefeuille)publicly-traded liabilitypublicly-traded liability, of an entity, means a liability that is a security of the entity, that is not equity of the entity and that is listed or traded on a stock exchange or other public market. (dette transigée publiquement)public marketpublic marketincludes any trading system or other organized facility on which securities that are qualified for public distribution are listed or traded, but does not include a facility that is operated solely to carry out the issuance of a security or its redemption, acquisition or cancellation by its issuer. (marché public)qualified REIT propertyqualified REIT property, of a trust at any time, means a property that, at that time, is held by the trust and is(a)a real or immovable property that is capital property, an eligible resale property, an indebtedness of a Canadian corporation represented by a bankers’ acceptance, a property described by paragraph (a) or (b) of the definitionqualified investmentin section 204 or a deposit with a credit union;(b)a security of a subject entity all or substantially all of the gross REIT revenue of which, for its taxation year that ends in the trust’s taxation year that includes that time, is from maintaining, improving, leasing or managing real or immovable properties that are capital properties of the trust or of an entity of which the trust holds a share or an interest, including real or immovable properties that the trust, or an entity of which the trust holds a share or an interest, holds together with one or more other persons or partnerships;(c)a security of a subject entity, if the entity holds no property other than(i)legal title to real or immovable property of the trust or of another subject entity all of the securities of which are held by the trust (including real or immovable property that the trust or the other subject entity holds together with one or more other persons or partnerships), and(ii)property described in paragraph (d); or(d)ancillary to the earning by the trust of amounts described in subparagraphs (b)(i) and (iii) of the definitionreal estate investment trust, other than(i)an equity of an entity, or(ii)a mortgage, hypothecary claim, mezzanine loan or similar obligation. (bien admissible de FPI)real estate investment trustreal estate investment trust, for a taxation year, means a trust that is resident in Canada throughout the taxation year, if(a)at each time in the taxation year the total fair market value at that time of all non-portfolio properties that are qualified REIT properties held by the trust is at least 90% of the total fair market value at that time of all non-portfolio properties held by the trust;(b)not less than 90% of the trust’s gross REIT revenue for the taxation year is from one or more of the following:(i)rent from real or immovable properties,(ii)interest,(iii)dispositions of real or immovable properties that are capital properties,(iv)dividends,(v)royalties, and(vi)dispositions of eligible resale properties;(c)not less than 75% of the trust’s gross REIT revenue for the taxation year is from one or more of the following:(i)rent from real or immovable properties,(ii)interest from mortgages, or hypothecs, on real or immovable properties, and(iii)dispositions of real or immovable properties that are capital properties;(d)at each time in the taxation year an amount, that is equal to 75% or more of the equity value of the trust at that time, is the amount that is the total fair market value of all properties held by the trust each of which is a real or immovable property that is capital property, an eligible resale property, an indebtedness of a Canadian corporation represented by a bankers’ acceptance, a property described by paragraph (a) or (b) of the definitionqualified investmentin section 204 or a deposit with a credit union; and(e)investments in the trust are, at any time in the taxation year, listed or traded on a stock exchange or other public market. (fiducie de placement immobilier)real or immovable propertyreal or immovable property, of a taxpayer,(a)includes(i)a security held by the taxpayer, if the security is a security of a trust that satisfies (or of any other entity that would, if it were a trust, satisfy) the conditions set out in paragraphs (a) to (d) of the definitionreal estate investment trust, or(ii)an interest in real property or a real right in immovables (other than a right to a rental or royalty described in paragraph (d) or (e) of the definition “Canadian resource property” in subsection 66(15)); but(b)does not include any depreciable property, other than(i)a property included, otherwise than by an election permitted by regulation, in Class 1, 3 or 31 of Schedule II to theIncome Tax Regulations,(ii)a property ancillary to the ownership or utilization of a property described in subparagraph (i), or(iii)a lease in, or a leasehold interest in respect of, land or property described in subparagraph (i). (bien immeuble ou réel)regulated innovative capitalregulated innovative capitalmeans equity of a trust, where(a)since November 2006, the equity has been authorized, by the Superintendent of Financial Institutions or by a provincial regulatory authority having powers similar to those of the Superintendent, as Tier 1 or Tier 2 capital of a financial institution (as defined by subsection 181(1));(b)the terms and conditions of the equity have not changed after August 1, 2008;(c)the trust has not issued any equity after October 31, 2006; and(d)the trust does not hold any non-portfolio property other than(i)liabilities of the financial institution, and(ii)shares of the capital stock of the financial institution that were acquired by the trust for the sole purpose of satisfying a right to require the trust to accept, as demanded by a holder of the equity, the surrender of the equity. (capital innovateur réglementé)rent from real or immovable propertiesrent from real or immovable properties(a)includes(i)rent or similar payments for the use of, or right to use, real or immovable properties, and(ii)payment for services ancillary to the rental of real or immovable properties and customarily supplied or rendered in connection with the rental of real or immovable properties; but(iii)[Repealed, 2013, c. 34, s. 258](b)does not include(i)payment for services supplied or rendered, other than those described in subparagraph (a)(ii), to the tenants of such properties,(ii)fees for managing or operating such properties,(iii)payment for the occupation of, use of, or right to use a room in a hotel or other similar lodging facility, or(iv)rent based on profits. (loyer de biens immeubles ou réels)securitysecurityof a particular entity means any right, whether absolute or contingent, conferred by the particular entity or by an entity that is affiliated with the particular entity, to receive, either immediately or in the future, an amount that can reasonably be regarded as all or any part of the capital, of the revenue or of the income of the particular entity, or as interest paid or payable by the particular entity, and for greater certainty includes(a)a liability of the particular entity;(b)if the particular entity is a corporation,(i)a share of the capital stock of the corporation, and(ii)a right to control in any manner whatever the voting rights of a share of the capital stock of the corporation;(c)if the particular entity is a trust, an income or a capital interest in the trust;(d)if the particular entity is a partnership, an interest as a member of the partnership; and(e)a right to, or to acquire, anything described in this paragraph and any of paragraphs (a) to (d). (titre)SIFT trustSIFT trust, being a specified investment flow-through trust, for a taxation year means a trust (other than an excluded subsidiary entity, or a real estate investment trust, for the taxation year) that meets the following conditions at any time during the taxation year:(a)the trust is resident in Canada;(b)investments in the trust are listed or traded on a stock exchange or other public market; and(c)the trust holds one or more non-portfolio properties. (fiducie intermédiaire de placement déterminée)subject entitysubject entitymeans a person or partnership that is(a)a corporation resident in Canada;(b)a trust resident in Canada;(c)a Canadian resident partnership; or(d)a non-resident person, or a partnership that is not described in paragraph (c), the principal source of income of which is one or any combination of sources in Canada. (entité déterminée)unaffiliated publicly-traded liabilityunaffiliated publicly-traded liability, of an entity at any time means a publicly-traded liability of the entity if, at that time the total fair market value of all publicly-traded liabilities of the entity that are held at that time by persons or partnerships that are not affiliated with the entity is at least 90% of the total fair market value of all publicly-traded liabilities of the entity. (dette non affiliée transigée publiquement)Marginal note:Application of subsection (1.2)(1.1)Subsection (1.2) applies to an entity for a taxation year in respect of an amount and another entity (referred to in this subsection and subsection (1.2) as the “parent entity”, “specified amount” and “source entity”, respectively), if(a)at any time in the taxation year the parent entity(i)is affiliated with the source entity, or(ii)holds securities of the source entity that(A)are described by any of paragraphs (a) to (c) of the definitionequityin subsection (1), and(B)have a total fair market value that is greater than 10% of the equity value of the source entity;(b)the specified amount is included in computing the parent entity’s gross REIT revenue for the taxation year in respect of a security of the source entity held by the parent entity; and(c)in the case of a source entity that is a subject entity described in paragraph (b) of the definitionqualified REIT propertyin subsection (1) in respect of the parent entity at each time during the taxation year at which the parent entity holds securities of the source entity, the specified amount cannot reasonably be considered to be derived from the source entity’s gross REIT revenue from maintaining, improving, leasing or managing real or immovable properties that are capital properties of the parent entity or of an entity of which the parent entity holds a share or an interest, including real or immovable properties that the parent entity, or an entity of which the parent entity holds a share or an interest, holds together with one or more other persons or partnerships.Marginal note:Character preservation rule(1.2)If this subsection applies to a parent entity for a taxation year in respect of a specified amount and a source entity, then for the purposes of the definitionreal estate investment trustin subsection (1), to the extent that the specified amount can reasonably be considered to be derived from gross REIT revenue of the source entity having a particular character, the specified amount is deemed to be gross REIT revenue of the parent entity having the same character and not having any other character.Marginal note:Character of revenue — hedging arrangements(1.3)For the purposes of the definitionreal estate investment trustin subsection (1),(a)if an amount is included in gross REIT revenue of a trust for a taxation year and it results from an agreement that can reasonably be considered to have been made by the trust to reduce its risk from fluctuations in interest rates in respect of debt incurred by the trust to acquire or refinance real or immovable property, the amount is deemed to have the same character as gross REIT revenue in respect of the real or immovable property and not any other character; and(b)if a real or immovable property is situated in a country other than Canada and an amount included in gross REIT revenue of a trust for a taxation year(i)is a gain from fluctuations in the value of the currency of that country relative to Canadian currency recognized on(A)revenue in respect of the real or immovable property, or(B)debt incurred by the trust for the purpose of earning revenue in respect of the real or immovable property, or(ii)results from an agreement that(A)provides for the purchase, sale or exchange of currency, and(B)can reasonably be considered to have been made by the trust to reduce its risk from currency fluctuations described in subparagraph (i),the amount is deemed to have the same character as gross REIT revenue in respect of the real or immovable property and not any other character.Marginal note:Application of definitionSIFT trust(2)The definitionSIFT trustapplies to a trust for a taxation year of the trust that ends after 2006, except that if the trust would have been a SIFT trust on October 31, 2006 had that definition been in force and applied to the trust as of that date, that definition does not apply to the trust for a taxation year of the trust that ends before the earlier of(a)2011, and(b)the first day after December 15, 2006 on which the trust exceeds normal growth as determined by reference to the normal growth guidelines issued by the Department of Finance on December 15, 2006, as amended from time to time, unless that excess arose as a result of a prescribed transaction.
(a)that is contiguous to a particular real or immovable property that is capital property or eligible resale property, held by(i)the entity, or(ii)another entity affiliated with the entity; and(b)the holding of which is ancillary to the holding of the particular property. (bien de revente admissible)
(i)the entity, or(ii)another entity affiliated with the entity; and
(a)if the entity is a corporation, a share of the capital stock of the corporation;(b)if the entity is a trust, an income or capital interest in the trust;(c)if the entity is a partnership, an interest as a member of the partnership;(d)a liability of the entity (and, for purposes of the definitionpublicly-traded liabilityin this section, a security of the entity that is a liability of another entity) if(i)the liability is convertible into, or exchangeable for, equity of the entity or of another entity, or(ii)any amount paid or payable in respect of the liability is contingent or dependent on the use of or production from property, or is computed by reference to revenue, profit, cash flow, commodity price or any other similar criterion or by reference to dividends paid or payable to shareholders of any class of shares of the capital stock of a corporation, or to income or capital paid or payable to any member of a partnership or beneficiary under a trust; and(e)a right to, or to acquire, anything described in this paragraph and any of paragraphs (a) to (d). (capitaux propres)
(i)the liability is convertible into, or exchangeable for, equity of the entity or of another entity, or(ii)any amount paid or payable in respect of the liability is contingent or dependent on the use of or production from property, or is computed by reference to revenue, profit, cash flow, commodity price or any other similar criterion or by reference to dividends paid or payable to shareholders of any class of shares of the capital stock of a corporation, or to income or capital paid or payable to any member of a partnership or beneficiary under a trust; and
(a)if the entity is a corporation, all of the issued and outstanding shares of the capital stock of the corporation;(b)if the entity is a trust, all of the income or capital interests in the trust; or(c)if the entity is a partnership, all of the interests in the partnership. (valeur des capitaux propres)
(a)listed or traded on a stock exchange or other public market; nor(b)held by any person or partnership other than(i)a real estate investment trust,(ii)a taxable Canadian corporation,(iii)a SIFT trust (determined without reference to subsection (2)),(iv)a SIFT partnership (determined without reference to subsection 197(8)),(v)a person or partnership that does not have, in connection with the holding of a security of the entity, property the value of which is determined, all or in part, by reference to a security that is listed or traded on a stock exchange or other public market, or(vi)an excluded subsidiary entity for the taxation year. (filiale exclue)
(i)a real estate investment trust,(ii)a taxable Canadian corporation,(iii)a SIFT trust (determined without reference to subsection (2)),(iv)a SIFT partnership (determined without reference to subsection 197(8)),(v)a person or partnership that does not have, in connection with the holding of a security of the entity, property the value of which is determined, all or in part, by reference to a security that is listed or traded on a stock exchange or other public market, or(vi)an excluded subsidiary entity for the taxation year. (filiale exclue)
(a)means(i)a property that is a security of the trust or partnership, or(ii)a right which may reasonably be considered to replicate a return on, or the value of, a security of the trust or partnership; but(b)does not include(i)an unaffiliated publicly-traded liability of the trust or partnership, nor(ii)regulated innovative capital. (placement)
(i)a property that is a security of the trust or partnership, or(ii)a right which may reasonably be considered to replicate a return on, or the value of, a security of the trust or partnership; but
(i)an unaffiliated publicly-traded liability of the trust or partnership, nor(ii)regulated innovative capital. (placement)
(a)the amount, if any, by which(i)the total of all amounts each of which is the SIFT trust’s income for the taxation year from a business carried on by it in Canada or from a non-portfolio property, other than income that is a taxable dividend received by the SIFT trust,exceeds(ii)the total of all amounts each of which is the SIFT trust’s loss for the taxation year from a business carried on by it in Canada or from a non-portfolio property, and(b)the amount, if any, by which(i)the total of(A)all taxable capital gains of the SIFT trust from dispositions of non-portfolio properties during the taxation year, and(B)one-half of the total of all amounts each of which is deemed under subsection 131(1) to be a capital gain of the SIFT trust for the taxation year in respect of a non-portfolio property of the SIFT trust for the taxation yearexceeds(ii)the total of the allowable capital losses of the SIFT trust for the taxation year from dispositions of non-portfolio properties during the taxation year. (gains hors portefeuille)
(i)the total of all amounts each of which is the SIFT trust’s income for the taxation year from a business carried on by it in Canada or from a non-portfolio property, other than income that is a taxable dividend received by the SIFT trust,
(ii)the total of all amounts each of which is the SIFT trust’s loss for the taxation year from a business carried on by it in Canada or from a non-portfolio property, and
(i)the total of(A)all taxable capital gains of the SIFT trust from dispositions of non-portfolio properties during the taxation year, and(B)one-half of the total of all amounts each of which is deemed under subsection 131(1) to be a capital gain of the SIFT trust for the taxation year in respect of a non-portfolio property of the SIFT trust for the taxation year
(A)all taxable capital gains of the SIFT trust from dispositions of non-portfolio properties during the taxation year, and(B)one-half of the total of all amounts each of which is deemed under subsection 131(1) to be a capital gain of the SIFT trust for the taxation year in respect of a non-portfolio property of the SIFT trust for the taxation year
(ii)the total of the allowable capital losses of the SIFT trust for the taxation year from dispositions of non-portfolio properties during the taxation year. (gains hors portefeuille)
(a)a security of a subject entity (other than a portfolio investment entity), if at that time the particular entity holds(i)securities of the subject entity that have a total fair market value that is greater than 10% of the equity value of the subject entity, or(ii)securities of the subject entity that, together with all the securities that the particular entity holds of entities affiliated with the subject entity, have a total fair market value that is greater than 50% of the equity value of the particular entity;(b)a Canadian real, immovable or resource property, if at any time in the taxation year the total fair market value of all properties held by the particular entity that are Canadian real, immovable or resource properties is greater than 50% of the equity value of the particular entity; or(c)a property that the particular entity, or a person or partnership with whom the particular entity does not deal at arm’s length, uses at that time in the course of carrying on a business in Canada. (bien hors portefeuille)
(i)securities of the subject entity that have a total fair market value that is greater than 10% of the equity value of the subject entity, or(ii)securities of the subject entity that, together with all the securities that the particular entity holds of entities affiliated with the subject entity, have a total fair market value that is greater than 50% of the equity value of the particular entity;
(a)a real or immovable property that is capital property, an eligible resale property, an indebtedness of a Canadian corporation represented by a bankers’ acceptance, a property described by paragraph (a) or (b) of the definitionqualified investmentin section 204 or a deposit with a credit union;(b)a security of a subject entity all or substantially all of the gross REIT revenue of which, for its taxation year that ends in the trust’s taxation year that includes that time, is from maintaining, improving, leasing or managing real or immovable properties that are capital properties of the trust or of an entity of which the trust holds a share or an interest, including real or immovable properties that the trust, or an entity of which the trust holds a share or an interest, holds together with one or more other persons or partnerships;(c)a security of a subject entity, if the entity holds no property other than(i)legal title to real or immovable property of the trust or of another subject entity all of the securities of which are held by the trust (including real or immovable property that the trust or the other subject entity holds together with one or more other persons or partnerships), and(ii)property described in paragraph (d); or(d)ancillary to the earning by the trust of amounts described in subparagraphs (b)(i) and (iii) of the definitionreal estate investment trust, other than(i)an equity of an entity, or(ii)a mortgage, hypothecary claim, mezzanine loan or similar obligation. (bien admissible de FPI)
(i)legal title to real or immovable property of the trust or of another subject entity all of the securities of which are held by the trust (including real or immovable property that the trust or the other subject entity holds together with one or more other persons or partnerships), and(ii)property described in paragraph (d); or
(i)an equity of an entity, or(ii)a mortgage, hypothecary claim, mezzanine loan or similar obligation. (bien admissible de FPI)
(a)at each time in the taxation year the total fair market value at that time of all non-portfolio properties that are qualified REIT properties held by the trust is at least 90% of the total fair market value at that time of all non-portfolio properties held by the trust;(b)not less than 90% of the trust’s gross REIT revenue for the taxation year is from one or more of the following:(i)rent from real or immovable properties,(ii)interest,(iii)dispositions of real or immovable properties that are capital properties,(iv)dividends,(v)royalties, and(vi)dispositions of eligible resale properties;(c)not less than 75% of the trust’s gross REIT revenue for the taxation year is from one or more of the following:(i)rent from real or immovable properties,(ii)interest from mortgages, or hypothecs, on real or immovable properties, and(iii)dispositions of real or immovable properties that are capital properties;(d)at each time in the taxation year an amount, that is equal to 75% or more of the equity value of the trust at that time, is the amount that is the total fair market value of all properties held by the trust each of which is a real or immovable property that is capital property, an eligible resale property, an indebtedness of a Canadian corporation represented by a bankers’ acceptance, a property described by paragraph (a) or (b) of the definitionqualified investmentin section 204 or a deposit with a credit union; and(e)investments in the trust are, at any time in the taxation year, listed or traded on a stock exchange or other public market. (fiducie de placement immobilier)
(i)rent from real or immovable properties,(ii)interest,(iii)dispositions of real or immovable properties that are capital properties,(iv)dividends,(v)royalties, and(vi)dispositions of eligible resale properties;
(i)rent from real or immovable properties,(ii)interest from mortgages, or hypothecs, on real or immovable properties, and(iii)dispositions of real or immovable properties that are capital properties;
(a)includes(i)a security held by the taxpayer, if the security is a security of a trust that satisfies (or of any other entity that would, if it were a trust, satisfy) the conditions set out in paragraphs (a) to (d) of the definitionreal estate investment trust, or(ii)an interest in real property or a real right in immovables (other than a right to a rental or royalty described in paragraph (d) or (e) of the definition “Canadian resource property” in subsection 66(15)); but(b)does not include any depreciable property, other than(i)a property included, otherwise than by an election permitted by regulation, in Class 1, 3 or 31 of Schedule II to theIncome Tax Regulations,(ii)a property ancillary to the ownership or utilization of a property described in subparagraph (i), or(iii)a lease in, or a leasehold interest in respect of, land or property described in subparagraph (i). (bien immeuble ou réel)
(i)a security held by the taxpayer, if the security is a security of a trust that satisfies (or of any other entity that would, if it were a trust, satisfy) the conditions set out in paragraphs (a) to (d) of the definitionreal estate investment trust, or(ii)an interest in real property or a real right in immovables (other than a right to a rental or royalty described in paragraph (d) or (e) of the definition “Canadian resource property” in subsection 66(15)); but
(i)a property included, otherwise than by an election permitted by regulation, in Class 1, 3 or 31 of Schedule II to theIncome Tax Regulations,(ii)a property ancillary to the ownership or utilization of a property described in subparagraph (i), or(iii)a lease in, or a leasehold interest in respect of, land or property described in subparagraph (i). (bien immeuble ou réel)
(a)since November 2006, the equity has been authorized, by the Superintendent of Financial Institutions or by a provincial regulatory authority having powers similar to those of the Superintendent, as Tier 1 or Tier 2 capital of a financial institution (as defined by subsection 181(1));(b)the terms and conditions of the equity have not changed after August 1, 2008;(c)the trust has not issued any equity after October 31, 2006; and(d)the trust does not hold any non-portfolio property other than(i)liabilities of the financial institution, and(ii)shares of the capital stock of the financial institution that were acquired by the trust for the sole purpose of satisfying a right to require the trust to accept, as demanded by a holder of the equity, the surrender of the equity. (capital innovateur réglementé)
(i)liabilities of the financial institution, and(ii)shares of the capital stock of the financial institution that were acquired by the trust for the sole purpose of satisfying a right to require the trust to accept, as demanded by a holder of the equity, the surrender of the equity. (capital innovateur réglementé)
(a)includes(i)rent or similar payments for the use of, or right to use, real or immovable properties, and(ii)payment for services ancillary to the rental of real or immovable properties and customarily supplied or rendered in connection with the rental of real or immovable properties; but(iii)[Repealed, 2013, c. 34, s. 258](b)does not include(i)payment for services supplied or rendered, other than those described in subparagraph (a)(ii), to the tenants of such properties,(ii)fees for managing or operating such properties,(iii)payment for the occupation of, use of, or right to use a room in a hotel or other similar lodging facility, or(iv)rent based on profits. (loyer de biens immeubles ou réels)
(i)rent or similar payments for the use of, or right to use, real or immovable properties, and(ii)payment for services ancillary to the rental of real or immovable properties and customarily supplied or rendered in connection with the rental of real or immovable properties; but(iii)[Repealed, 2013, c. 34, s. 258]
(i)payment for services supplied or rendered, other than those described in subparagraph (a)(ii), to the tenants of such properties,(ii)fees for managing or operating such properties,(iii)payment for the occupation of, use of, or right to use a room in a hotel or other similar lodging facility, or(iv)rent based on profits. (loyer de biens immeubles ou réels)
(a)a liability of the particular entity;(b)if the particular entity is a corporation,(i)a share of the capital stock of the corporation, and(ii)a right to control in any manner whatever the voting rights of a share of the capital stock of the corporation;(c)if the particular entity is a trust, an income or a capital interest in the trust;(d)if the particular entity is a partnership, an interest as a member of the partnership; and(e)a right to, or to acquire, anything described in this paragraph and any of paragraphs (a) to (d). (titre)
(i)a share of the capital stock of the corporation, and(ii)a right to control in any manner whatever the voting rights of a share of the capital stock of the corporation;
(a)the trust is resident in Canada;(b)investments in the trust are listed or traded on a stock exchange or other public market; and(c)the trust holds one or more non-portfolio properties. (fiducie intermédiaire de placement déterminée)
(a)a corporation resident in Canada;(b)a trust resident in Canada;(c)a Canadian resident partnership; or(d)a non-resident person, or a partnership that is not described in paragraph (c), the principal source of income of which is one or any combination of sources in Canada. (entité déterminée)
(a)at any time in the taxation year the parent entity(i)is affiliated with the source entity, or(ii)holds securities of the source entity that(A)are described by any of paragraphs (a) to (c) of the definitionequityin subsection (1), and(B)have a total fair market value that is greater than 10% of the equity value of the source entity;(b)the specified amount is included in computing the parent entity’s gross REIT revenue for the taxation year in respect of a security of the source entity held by the parent entity; and(c)in the case of a source entity that is a subject entity described in paragraph (b) of the definitionqualified REIT propertyin subsection (1) in respect of the parent entity at each time during the taxation year at which the parent entity holds securities of the source entity, the specified amount cannot reasonably be considered to be derived from the source entity’s gross REIT revenue from maintaining, improving, leasing or managing real or immovable properties that are capital properties of the parent entity or of an entity of which the parent entity holds a share or an interest, including real or immovable properties that the parent entity, or an entity of which the parent entity holds a share or an interest, holds together with one or more other persons or partnerships.
(i)is affiliated with the source entity, or(ii)holds securities of the source entity that(A)are described by any of paragraphs (a) to (c) of the definitionequityin subsection (1), and(B)have a total fair market value that is greater than 10% of the equity value of the source entity;
(A)are described by any of paragraphs (a) to (c) of the definitionequityin subsection (1), and(B)have a total fair market value that is greater than 10% of the equity value of the source entity;
(a)if an amount is included in gross REIT revenue of a trust for a taxation year and it results from an agreement that can reasonably be considered to have been made by the trust to reduce its risk from fluctuations in interest rates in respect of debt incurred by the trust to acquire or refinance real or immovable property, the amount is deemed to have the same character as gross REIT revenue in respect of the real or immovable property and not any other character; and(b)if a real or immovable property is situated in a country other than Canada and an amount included in gross REIT revenue of a trust for a taxation year(i)is a gain from fluctuations in the value of the currency of that country relative to Canadian currency recognized on(A)revenue in respect of the real or immovable property, or(B)debt incurred by the trust for the purpose of earning revenue in respect of the real or immovable property, or(ii)results from an agreement that(A)provides for the purchase, sale or exchange of currency, and(B)can reasonably be considered to have been made by the trust to reduce its risk from currency fluctuations described in subparagraph (i),the amount is deemed to have the same character as gross REIT revenue in respect of the real or immovable property and not any other character.
(i)is a gain from fluctuations in the value of the currency of that country relative to Canadian currency recognized on(A)revenue in respect of the real or immovable property, or(B)debt incurred by the trust for the purpose of earning revenue in respect of the real or immovable property, or(ii)results from an agreement that(A)provides for the purchase, sale or exchange of currency, and(B)can reasonably be considered to have been made by the trust to reduce its risk from currency fluctuations described in subparagraph (i),
(A)revenue in respect of the real or immovable property, or(B)debt incurred by the trust for the purpose of earning revenue in respect of the real or immovable property, or
(A)provides for the purchase, sale or exchange of currency, and(B)can reasonably be considered to have been made by the trust to reduce its risk from currency fluctuations described in subparagraph (i),
(a)2011, and(b)the first day after December 15, 2006 on which the trust exceeds normal growth as determined by reference to the normal growth guidelines issued by the Department of Finance on December 15, 2006, as amended from time to time, unless that excess arose as a result of a prescribed transaction.
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]2007, c. 29, s. 13, c. 35, s. 412009, c. 2, s. 362013, c. 34, s. 258, c. 40, s. 51
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]R.S., 1985, c. 1 (5th Supp.), s. 122.21994, c. 7, Sch