• Marginal note:Ecological gifts

  (d) the total of all amounts each of which is the fair market value of a gift of land, including a servitude for the use and benefit of a dominant land, a covenant or an easement, the fair market value of which is certified by the Minister of the Environment and that is certified by that Minister, or by a person designated by that Minister, to be ecologically sensitive land, the conservation and protection of which is, in the opinion of that Minister, or that person, important to the preservation of Canada’s environmental heritage, which gift was made by the corporation in the year or in any of the five preceding taxation years to

• Marginal note:Proof of gift

  (2) A gift shall not be included for the purpose of determining a deduction under subsection (1) unless the making of the gift is proven by filing with the Minister

  • (a) a receipt for the gift that contains prescribed information;

  • (b) in the case of a gift described in paragraph (1)(c), the certificate issued under subsection 33(1) of the Cultural Property Export and Import Act; and

  • (c) in the case of a gift described in paragraph (1)(d), both certificates referred to in that paragraph.

such amount, not greater than the fair market value otherwise determined and not less than the adjusted cost base to the corporation of the property at that time, as the corporation designates in its return of income under section 150 for the year in which the gift is made is, if the making of the gift is proven by filing with the Minister a receipt containing prescribed information, deemed to be its proceeds of disposition of the property and, for the purposes of subsection (1), the fair market value of the gift made by the corporation.

• Marginal note:Ecological gifts

  (5) For the purposes of applying subparagraph 69(1)(b)(ii), section 207.31 and this section in respect of a gift described in paragraph (1)(d) that is made by a taxpayer and that is a servitude, covenant or easement to which land is subject, the greater of

  • (a) the fair market value otherwise determined of the gift, and

  • (b) the amount by which the fair market value of the land is reduced as a result of the making of the gift

  is deemed to be the fair market value (or, for the purpose of subsection (3), the fair market value otherwise determined) of the gift at the time the gift was made and, subject to subsection (3), to be the taxpayer’s proceeds of disposition of the gift.

• Marginal note:Ecological gifts

  (5) For the purposes of applying subparagraph 69(1)(b)(ii), this section and section 207.31 in respect of a gift described in paragraph (1)(d) that is made by a taxpayer, the amount that is the fair market value (or, for the purpose of subsection (3), the fair market value otherwise determined) of the gift at the time the gift was made and, subject to subsection (3), the taxpayer’s proceeds of disposition of the gift, is deemed to be the amount determined by the Minister of the Environment to be

  • (a) where the gift is land, the fair market value of the gift; or

  • (b) where the gift is a servitude, covenant or easement to which land is subject, the greater of

    • (i) the fair market value otherwise determined of the gift, and

    • (ii) the amount by which the fair market value of the land is reduced as a result of the making of the gift.

• (ii) paragraph 20(1)(j) or subsection 65(1), 66(4), 66.1(3), 66.2(2), 66.21(4) or 66.4(2),

• (d) 50% of the total of all amounts each of which is an amount deducted under subsection 66(4), 66.1(3), 66.2(2), 66.21(4) or 66.4(2) in computing the individual’s income for the year in respect of expenses

  • (i) incurred and renounced under subsection 66(12.6), (12.601), (12.62) or (12.64) by a corporation, or

  • (ii) incurred by a partnership of which the individual was a specified member in the fiscal period of the partnership in which the expense was incurred, and

• (a) the amount determined by the formula

  [$250,000 – (A + B + C + D)] × E

  where

  A

  is the total of all amounts each of which is an amount deducted under this section in computing the individual’s taxable income for a preceding taxation year that ended before 1988,

  B

  is the total of all amounts each of which is

  • (i) 3/4 of an amount deducted under this section in computing the individual’s taxable income for a preceding taxation year that ended after 1987 and before 1990 (other than amounts deducted under this section for a taxation year in respect of an amount that was included in computing an individual’s income for that year because of subparagraph 14(1)(a)(v) as that subparagraph applied for taxation years that ended before February 28, 2000), or

  • (ii) 3/4 of an amount deducted under this section in computing the individual’s taxable income for a preceding taxation year that began after February 27, 2000 and ended before October 18, 2000,

  C

  is 2/3 of the total of all amounts each of which is an amount deducted under this section in computing the individual’s taxable income

  • (i) for a preceding taxation year that ended after 1989 and before February 28, 2000, or

  • (ii) in respect of an amount that was included because of subparagraph 14(1)(a)(v) (as that subparagraph applied for taxation years that ended before February 28, 2000) in computing the individual’s income for a taxation year that began after 1987 and ended before 1990,

  D

  is the product obtained when the reciprocal of the fraction determined for E that applied to the taxpayer for a preceding taxation year that began before and included February 28, 2000 or October 17, 2000 is multiplied by the amount deducted under this subsection in computing the individual’s taxable income for that preceding year, and

  E

  is

  • (i) in the case of a taxation year that includes February 28, 2000 or October 17, 2000, the amount determined by the formula

    2 × (F + G) / H

    where

    F

    is the amount deemed by subsection 14(1.1) to be a taxable capital gain of the taxpayer for the taxation year,

    G

    is the amount by which the amount determined in respect of the taxpayer for the year under paragraph 3(b) exceeds the amount determined for F, and

    H

    is the total of

    • (A) the amount deemed by subsection 14(1.1) to be a taxable capital gain of the taxpayer for the taxation year multiplied by

      • (I) where that amount is determined by reference to paragraph 14(1.1)(a), the reciprocal of the fraction obtained by multiplying the fraction 3/4 by the fraction in paragraph 14(1)(b) that applies to the taxpayer for the taxation year,

      • (II) where that amount is determined by reference to paragraph 14(1.1)(b), and the taxation year does not end after February 27, 2000 and before October 18, 2000, 2, and

      • (III) where that amount is determined by reference to paragraph 14(1.1)(b), and the taxation year ends after February 27, 2000 and before October 18, 2000, 3/2, and

    • (B) the amount determined for G multiplied by the reciprocal of the fraction in paragraph 38(a) that applies to the taxpayer for the taxation year, and

  • (ii) in any other case, 1,

• (a) the amount determined by the formula in paragraph (2)(a) in respect of the individual for the year,

• Marginal note:Maximum capital gains deduction

  (4) Notwithstanding subsection (2) and (2.1), the total amount that may be deducted under this section in computing an individual’s income for a taxation year shall not exceed the amount determined by the formula in paragraph (2)(a) in respect of the individual for the year.

• Marginal note:Trust deduction

  (12) Notwithstanding any other provision of this Act, a trust described in paragraph 104(4)(a) or (a.1) (other than a trust that elected under subsection 104(5.3), an alter ego trust or a joint spousal or common-law partner trust) may, in computing its taxable income for its taxation year that includes the day determined under paragraph 104(4)(a) or (a.1), as the case may be, in respect of the trust, deduct under this section an amount equal to the least of

• (c) the amount, if any, by which the amount determined by the formula in paragraph (2)(a) in respect of the taxpayer’s spouse or common-law partner for the taxation year in which that spouse or common-law partner died exceeds the amount deducted under this section for that taxation year by that spouse or common-law partner.

• (I) the foreign resource pool expenses, if any, incurred by the partnership in that fiscal period,

E

is the total of all amounts each of which is the taxpayer’s loss for the year from an office, employment, business or property, the taxpayer’s allowable business investment loss for the year, an amount deducted under paragraph (1)(b) or section 110.6 in computing the taxpayer’s taxable income for the year or an amount that may be deducted under any of paragraphs 110(1)(d) to (d.3), (f), (j) and (k), section 112 and subsections 113(1) and 138(6) in computing the taxpayer’s taxable income for the year, and

B

is the amount, if any, determined in respect of the taxpayer for the year under section 110.5 or subparagraph 115(1)(a)(vii),

C

is the total of all amounts deducted under section 110.6 in computing the individual’s taxable income for taxation years that end before 1988 or after October 17, 2000,

D

is 3/4 of the total of all amounts each of which is an amount deducted under section 110.6 in computing the individual’s taxable income for a taxation year, preceding the particular year, that

• (a) ended after 1987 and before 1990, or

• (b) began after February 27, 2000 and ended before October 18, 2000,

E

is 2/3 of the total of all amounts deducted under section 110.6 in computing the individual’s taxable income for taxation years, preceding the particular year, that ended after 1989 and before February 28, 2000, and

E.1

is the amount determined by the formula

J × (0.5 / K)

where

J

is the amount deducted by the individual under section 110.6 for a taxation year of the individual, preceding the particular year, that includes February 28, 2000 or October 17, 2000, and

K

is the fraction in paragraph 38(a) that applies to the individual for the individual’s taxation year referred to in the description of J.

• (a) in the part of the year throughout which the taxpayer was non-resident, if section 114 applies to the taxpayer in respect of the year, and

• Marginal note:Guaranteed shares

  (2.2) No deduction may be made under subsection (1), (2) or 138(6) in computing the taxable income of a particular corporation in respect of a dividend received on a share of the capital stock of a corporation that was issued after 8:00 p.m. Eastern Daylight Saving Time, June 18, 1987 where

  • (a) a person or partnership (in this subsection and subsection (2.21) referred to as the “guarantor”) that is a specified financial institution or a specified person in relation to any such institution, but that is not the issuer of the share or an individual other than a trust, is, at or immediately before the time the dividend is paid, obligated, either absolutely or contingently and either immediately or in the future, to effect any undertaking (in this subsection and subsections (2.21) and (2.22) referred to as a “guarantee agreement”), including any guarantee, covenant or agreement to purchase or repurchase the share and including the lending of funds to or the placing of amounts on deposit with, or on behalf of, the particular corporation or any specified person in relation to the particular corporation given to ensure that

    • (i) any loss that the particular corporation or a specified person in relation to the particular corporation may sustain by reason of the ownership, holding or disposition of the share or any other property is limited in any respect, or

    • (ii) the particular corporation or a specified person in relation to the particular corporation will derive earnings by reason of the ownership, holding or disposition of the share or any other property; and

  • (b) the guarantee agreement was given as part of a transaction or event or a series of transactions or events that included the issuance of the share.

• Marginal note:Exceptions

  (2.21) Subsection (2.2) does not apply to a dividend received by a particular corporation on

  • (a) a share that is at the time the dividend is received a share described in paragraph (e) of the definition “term preferred share” in subsection 248(1);

  • (b) a grandfathered share, a taxable preferred share issued before December 16, 1987 or a prescribed share;

  • (c) a taxable preferred share issued after December 15, 1987 and of a class of the capital stock of a corporation that is listed on a prescribed stock exchange where all guarantee agreements in respect of the share were given by one or more of the issuer of the share and persons that are related (otherwise than because of a right referred to in paragraph 251(5)(b)) to the issuer unless, at the time the dividend is paid to the particular corporation, dividends in respect of more than 10 per cent of the issued and outstanding shares to which the guarantee agreement applies are paid to the particular corporation or the particular corporation and specified persons in relation to the particular corporation; or

  • (d) a share

    • (i) that was not acquired by the particular corporation in the ordinary course of its business,

    • (ii) in respect of which the guarantee agreement was not given in the ordinary course of the guarantor’s business, and

    • (iii) the issuer of which is, at the time the dividend is paid, related (otherwise than because of a right referred to in paragraph 251(5)(b)) to both the particular corporation and the guarantor.

• Marginal note:Interpretation

  (2.22) For the purposes of subsections (2.2) and (2.21),

  • (a) where a guarantee agreement in respect of a share is given at any particular time after 8:00 p.m. Eastern Daylight Saving Time, June 18, 1987, otherwise than under a written arrangement to do so entered into before 8:00 p.m. Eastern Daylight Saving Time, June 18, 1987, the share is deemed to have been issued at the particular time and the guarantee agreement is deemed to have been given as part of a series of transactions that included the issuance of the share; and

  • (b) “specified person” has the meaning assigned by paragraph (h) of the definition “taxable preferred share” in subsection 248(1).