2200. Where, under subsection 220(4) of the Act, the Minister has accepted, as security for payment of taxes, a mortgage or other security or guarantee, he may, by a document in writing, discharge such mortgage or other security or guarantee.

• 2201. (1) For the purpose of subsection 227(4.2) of the Act, “prescribed security interest”, in relation to an amount deemed by subsection 227(4) of the Act to be held in trust by a person, means that part of a mortgage securing the performance of an obligation of the person, that encumbers land or a building, where the mortgage is registered pursuant to the appropriate land registration system before the time the amount is deemed to be held in trust by the person.

• (2) For the purpose of subsection (1), where, at any time after 1999, the person referred to in subsection (1) fails to pay an amount deemed by subsection 227(4) of the Act to be held in trust by the person, as required under the Act, the amount of the prescribed security interest referred to in subsection (1) is deemed not to exceed the amount by which the amount, at that time, of the obligation outstanding secured by the mortgage exceeds the total of

  • (a) all amounts each of which is the value determined at the time of the failure, having regard to all the circumstances including the existence of any deemed trust for the benefit of Her Majesty pursuant to subsection 227(4) of the Act, of all the rights of the secured creditor securing the obligation, whether granted by the person or not, including guarantees or rights of set-off but not including the mortgage referred to in subsection (1), and

  • (b) all amounts applied after the time of the failure on account of the obligation,

  so long as any amount deemed under any enactment administered by the Minister, other than the Excise Tax Act, to be held in trust by the person, remains unpaid.

• (3) For greater certainty, a prescribed security interest includes the amount of insurance or expropriation proceeds relating to land or a building that is the subject of a registered mortgage interest, adjusted after 1999 in accordance with subsection (2), but does not include a lien, a priority or any other security interest created by statute, an assignment or hypothec of rents or leases, or a mortgage interest in any equipment or fixtures that a mortgagee or any other person has the right absolutely or conditionally to remove or dispose of separately from the land or building.

2300. Any election by a taxpayer under subparagraph 40(2)(c)(ii) of the Act shall be made by attaching to the return of income required by section 150 of the Act to be filed by him for his taxation year in which the disposition of the land, including the property that was his principal residence, occurred, a letter signed by the taxpayer

• (a) stating that he is electing under that subparagraph;

• (b) stating the number of taxation years ending after the acquisition date (within the meaning assigned by paragraph 40(2)(b) of the Act) for which the property was his principal residence and during which he was resident in Canada; and

• (c) giving a description of the property sufficient to identify it with the property designated as his principal residence.