Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.))

Act current to 2017-12-11 and last amended on 2017-07-01. Previous Versions

 [Repealed, 2013, c. 40, s. 27]

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. 1 (5th Supp.), s. 60.001;
  • 2013, c. 40, s. 27.
Marginal note:Eligible amount

 For the purpose of paragraph 60(j), the amount, if any, by which

  • (a) the amount of any payment received by a taxpayer in a taxation year out of or under a foreign retirement arrangement and included in computing the taxpayer’s income because of clause 56(1)(a)(i)(C.1) (other than any portion thereof that is included in respect of the taxpayer for the year under subparagraph 60(j(i) or that is part of a series of periodic payments)

exceeds

  • (b) the portion, if any, of the payment included under paragraph 60.01(a) that can reasonably be considered to derive from contributions to the foreign retirement arrangement made by a person other than the taxpayer or the taxpayer’s spouse or common-law partner or former spouse or common-law partner,

is an eligible amount in respect of the taxpayer for the year.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 1994, c. 7, Sch. II, s. 35, Sch. VIII, s. 21;
  • 2000, c. 12, s. 142;
  • 2001, c. 17, s. 239(F).

Meaning of lifetime benefit trust

  •  (1) For the purpose of subsection (2), a trust is at any particular time a lifetime benefit trust with respect to a taxpayer and the estate of a deceased individual if

    • (a) immediately before the death of the deceased individual, the taxpayer

      • (i) was both a spouse or common-law partner of the deceased individual and mentally infirm, or

      • (ii) was both a child or grandchild of the deceased individual and dependent on the deceased individual for support because of mental infirmity; and

    • (b) the trust is, at the particular time, a personal trust under which

      • (i) no person other than the taxpayer may receive or otherwise obtain the use of, during the taxpayer’s lifetime, any of the income or capital of the trust, and

      • (ii) the trustees

        • (A) are empowered to pay amounts from the trust to the taxpayer, and

        • (B) are required — in determining whether to pay, or not to pay, an amount to the taxpayer — to consider the needs of the taxpayer including, without limiting the generality of the foregoing, the comfort, care and maintenance of the taxpayer.

  • Meaning of qualifying trust annuity

    (2) Each of the following is a qualifying trust annuity with respect to a taxpayer:

    • (a) an annuity that meets the following conditions:

      • (i) it is acquired after 2005,

      • (ii) the annuitant under it is a trust that is, at the time the annuity is acquired, a lifetime benefit trust with respect to the taxpayer and the estate of a deceased individual,

      • (iii) it is for the life of the taxpayer (with or without a guaranteed period), or for a fixed term equal to 90 years minus the age in whole years of the taxpayer at the time it is acquired, and

      • (iv) if it is with a guaranteed period or for a fixed term, it requires that, in the event of the death of the taxpayer during the guaranteed period or fixed term, any amounts that would otherwise be payable after the death of the taxpayer be commuted into a single payment;

    • (b) an annuity that meets the following conditions:

      • (i) it is acquired after 1988,

      • (ii) the annuitant under it is a trust under which the taxpayer is the sole person beneficially interested (determined without regard to any right of a person to receive an amount from the trust only on or after the death of the taxpayer) in amounts payable under the annuity,

      • (iii) it is for a fixed term not exceeding 18 years minus the age in whole years of the taxpayer at the time it is acquired, and

      • (iv) if it is acquired after 2005, it requires that, in the event of the death of the taxpayer during the fixed term, any amounts that would otherwise be payable after the death of the taxpayer be commuted into a single payment; and

    • (c) an annuity that meets the following conditions:

      • (i) it is acquired

        • (A) after 2000 and before 2005 at a time at which the taxpayer was mentally or physically infirm, or

        • (B) in 2005 at a time at which the taxpayer was mentally infirm,

      • (ii) the annuitant under it is a trust under which the taxpayer is the sole person beneficially interested (determined without regard to any right of a person to receive an amount from the trust only on or after the death of the taxpayer) in amounts payable under the annuity, and

      • (iii) it is for the life of the taxpayer (with or without a guaranteed period), or for a fixed term equal to 90 years minus the age in whole years of the taxpayer at the time it is acquired.

  • Application of paragraph 60(l) to qualifying trust annuity

    (3) For the purpose of paragraph 60(l),

    • (a) in determining if a qualifying trust annuity with respect to a taxpayer is an annuity described in subparagraph 60(l)(ii), clauses 60(l)(ii)(A) and (B) are to be read without regard to their requirement that the taxpayer be the annuitant under the annuity; and

    • (b) if an amount paid to acquire a qualifying trust annuity with respect to a taxpayer would, if this Act were read without reference to this subsection, not be considered to have been paid by or on behalf of the taxpayer, the amount is deemed to have been paid on behalf of the taxpayer where

      • (i) it is paid

        • (A) by the estate of a deceased individual who was, immediately before death,

          • (I) a spouse or common-law partner of the taxpayer, or

          • (II) a parent or grandparent of the taxpayer on whom the taxpayer was dependent for support, or

        • (B) by the trust that is the annuitant under the qualifying trust annuity, and

      • (ii) it would, if it had been paid by the taxpayer, be deductible under paragraph 60(l) in computing the taxpayer’s income for a taxation year and the taxpayer elects, in the taxpayer’s return of income under this Part for that taxation year, to have this paragraph apply to the amount.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 2013, c. 34, s. 197.
Marginal note:Definitions
  •  (1) The definitions in this subsection apply in this section and section 146.4,

    eligible individual

    particulier admissible

    eligible individual means a child or grandchild of a deceased annuitant under a registered retirement savings plan or a registered retirement income fund, or of a deceased member of a pooled registered pension plan, a registered pension plan or a specified pension plan, who was financially dependent on the deceased for support, at the time of the deceased’s death, by reason of mental or physical infirmity. (particulier admissible)

    eligible proceeds

    produit admissible

    eligible proceeds means an amount (other than an amount that was deducted under paragraph 60(l) in computing the eligible individual’s income) received by an eligible individual as a consequence of the death after March 3, 2010 of a parent or grandparent of the eligible individual that is

    • (a) a refund of premiums (as defined in subsection 146(1));

    • (b) an eligible amount under subsection 146.3(6.11); or

    • (c) a payment (other than a payment that is part of a series of periodic payments or that relates to an actuarial surplus) out of or under a pooled registered pension plan, a registered pension plan or a specified pension plan. (produit admissible)

    specified RDSP payment

    paiement de REEI déterminé

    specified RDSP payment in respect of an eligible individual means a payment that

    • (a) is made to a registered disability savings plan under which the eligible individual is the beneficiary;

    • (b) complies with the conditions set out in paragraphs 146.4(4)(f) to (h);

    • (c) is made after June 2011; and

    • (d) has been designated in prescribed form for a taxation year by the holder of the plan and the eligible individual at the time that the payment is made. (paiement de REEI déterminé)

    transitional eligible proceeds

    produit admissible transitoire

    transitional eligible proceeds of a taxpayer means

    • (a) any amount (other than an amount that is eligible proceeds or an amount that was deducted under paragraph 60(l) in computing the taxpayer’s income) that is received by the taxpayer as a consequence of the death of an individual after 2007 and before 2011 out of or under

      • (i) a registered retirement savings plan or registered retirement income fund, or

      • (ii) a registered pension plan (other than an amount that is received as part of a series of periodic payments or that relates to an actuarial surplus); or

    • (b) an amount withdrawn from the taxpayer’s registered retirement savings plan or a registered retirement income fund (in this subsection referred to as the “RRSP withdrawal”) if

      • (i) the taxpayer previously deducted an amount under paragraph 60(l) in respect of an amount that would be described by paragraph (a) if it were read without reference to “other than an amount that is eligible proceeds or an amount that was deducted under paragraph 60(l) in computing the taxpayer’s income”,

      • (ii) the RRSP withdrawal is included in computing the taxpayer’s income for the year of the withdrawal, and

      • (iii) the RRSP withdrawal does not exceed the amount deducted under subparagraph (i). (produit admissible transitoire)

  • Marginal note:Rollover to RDSP on death

    (2) There may be deducted in computing the income for a taxation year of a taxpayer who is an eligible individual an amount that

    • (a) does not exceed the lesser of

      • (i) the total specified RDSP payments made in the year or within 60 days after the end of the year (or within any longer period after the end of the year that is acceptable to the Minister) in respect of the taxpayer; and

      • (ii) the total amount of eligible proceeds that is included in computing the taxpayer’s income in the year; and

    • (b) was not deducted in computing the taxpayer’s income for a preceding taxation year.

  • Marginal note:Application of subsections (4) and (5)

    (3) Subsections (4) and (5) do not apply unless

    • (a) a taxpayer who was the annuitant under a registered retirement savings plan or a registered retirement income fund or was a member of a registered pension plan died after 2007 and before 2011;

    • (b) the taxpayer was, immediately before the taxpayer’s death, the parent or grandparent of an eligible individual;

    • (c) transitional eligible proceeds were received from the plan or fund by

      • (i) an eligible individual in respect of the taxpayer,

      • (ii) a person who was the spouse or common-law partner of the taxpayer immediately before the taxpayer’s death, or

      • (iii) a person who is a beneficiary of the taxpayer’s estate or who directly received transitional eligible proceeds as a consequence of the death of the taxpayer; and

    • (d) the transitional eligible proceeds were included in computing the income of a person for a taxation year.

  • Marginal note:Transitional rule

    (4) There may be deducted in computing the income of a taxpayer described in paragraph (3)(c) for a taxation year an amount approved by the Minister that does not exceed the lesser of

    • (a) the total specified RDSP payments made by the taxpayer before 2012, and

    • (b) the amount of transitional eligible proceeds included in computing the taxpayer’s income for the year.

  • Marginal note:Transitional rule — deceased taxpayer

    (5) There may be deducted in computing the income of a taxpayer for the taxation year in which the taxpayer died an amount approved by the Minister that does not exceed the lesser of

    • (a) the total specified RDSP payments made before 2012 by an individual described in subparagraph (3)(c)(iii), and

    • (b) the amount by which the total of all amounts that were included in computing the taxpayer’s income for the year under subsection 146(8.8) or 146.3(6) exceeds the total of all amounts, if any, that were deducted in computing the taxpayer’s income for the year under subsection 146(8.92) or 146.3(6.3).

  • Marginal note:Limitation

    (6) The total amounts that may be deducted under subsections (4) and (5) in respect of transitional eligible proceeds received in respect of the death of a taxpayer shall not exceed the total transitional eligible proceeds received in respect of the deceased taxpayer.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 1990, c. 35, s. 5;
  • 2010, c. 25, s. 11;
  • 2011, c. 24, s. 12;
  • 2012, c. 31, s. 13.
 
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