Budget Implementation Act, 2009 (S.C. 2009, c. 2)
Full Document:
Assented to 2009-03-12
46. (1) Paragraph (a) of the definition bien évalué à la valeur du marché in subsection 142.2(1) of the French version of the Act is replaced by the following:
a) une action;
(2) Paragraph (d) of the definition “mark-to-market property” in subsection 142.2(1) of the Act is replaced by the following:
(d) a share of a corporation in which the taxpayer has a significant interest at any time in the year,
(d.1) a property that is, at all times in the year at which the taxpayer holds the property, a prescribed payment card corporation share of the taxpayer,
(d.2) if the taxpayer is an investment dealer and the year begins after 1998, a property that is, at all times in the year at which the taxpayer holds the property, a prescribed securities exchange investment of the taxpayer,
(d.3) a share of a corporation held, at any time in the year, by the taxpayer if
(i) control of the corporation is, at any time (referred to in this paragraph as the “acquisition of control time”) that is after 2001 and is in the 24-month period that begins immediately after the end of the year, acquired by
(A) the taxpayer,
(B) one or more persons related to the taxpayer (otherwise than by reason of a right referred to in paragraph 251(5)(b)), or
(C) the taxpayer and one or more persons described in clause (B), and
(ii) the taxpayer elects in writing to have subparagraph (i) apply and files the election with the Minister on or before the taxpayer’s filing-due date for the taxpayer’s taxation year that includes the acquisition of control time, or
(3) The definition “mark-to-market property” in subsection 142.2(1) of the Act, as amended by subsection (2), is replaced by the following:
“mark-to-market property”
« bien évalué à la valeur du marché »
“mark-to-market property” of a taxpayer for a taxation year means property (other than an excluded property) held at any time in the taxation year by the taxpayer that is
(a) a share,
(b) if the taxpayer is not an investment dealer, a specified debt obligation that is a fair value property of the taxpayer for the taxation year,
(c) if the taxpayer is an investment dealer, a specified debt obligation, or
(d) a tracking property of the taxpayer that is a fair value property of the taxpayer for the taxation year;
(4) Subsection 142.2(1) of the Act is amended by adding the following in alphabetical order:
“excluded property”
« bien exclu »
“excluded property” of a taxpayer for a taxation year means property, held at any time in the taxation year by the taxpayer, that is
(a) a share of the capital stock of a corporation if, at any time in the taxation year, the taxpayer has a significant interest in the corporation,
(b) a property that is, at all times in the taxation year at which the taxpayer held the property, a prescribed payment card corporation share of the taxpayer,
(c) if the taxpayer is an investment dealer, a property that is, at all times in the taxation year at which the taxpayer held the property, a prescribed securities exchange investment of the taxpayer,
(d) a share of the capital stock of a corporation if
(i) control of the corporation is, at any time (referred to in this paragraph as the “acquisition of control time”) that is in the 24-month period that begins immediately after the end of the year, acquired by
(A) the taxpayer,
(B) one or more persons related to the taxpayer (otherwise than by reason of a right referred to in paragraph 251(5)(b)), or
(C) the taxpayer and one or more persons described in clause (B), and
(ii) the taxpayer elects in writing to have subparagraph (i) apply and files the election with the Minister on or before the taxpayer’s filing-due date for the taxpayer’s taxation year that includes the acquisition of control time, or
(e) a prescribed property;
“fair value property”
« bien évalué à sa juste valeur »
“fair value property” of a taxpayer for a taxation year means property, held at any time in the taxation year by the taxpayer, that is — or it is reasonable to expect would, if the taxpayer held the property at the end of the taxation year, be — valued (otherwise than solely because its fair value was less than its cost to the taxpayer or, if the property is a specified debt obligation, because of a default of the debtor) in accordance with generally accepted accounting principles, at its fair value (determined in accordance with those principles) in the taxpayer’s balance sheet as at the end of the taxation year;
“tracking property”
« bien à évaluer »
“tracking property” of a taxpayer means property of the taxpayer the fair market value of which is determined primarily by reference to one or more criteria in respect of property (referred to in this definition as “tracked property”) that, if owned by the taxpayer, would be mark-to-market property of the taxpayer, which criteria are
(a) the fair market value of the tracked property,
(b) the profits or gains from the disposition of the tracked property,
(c) the revenue, income or cash flow from the tracked property, or
(d) any other similar criteria in respect of the tracked property;
(5) The portion of subsection 142.2(2) of the Act before paragraph (a) is replaced by the following:
Marginal note:Significant interest
(2) For the purposes of the definitions “excluded property”, “mark-to-market property” and “specified debt obligation” in subsection (1) and subsections (5) and 142.6(1.6), a taxpayer has a significant interest in a corporation at any time if
(6) Subsections 142.2(4) and (5) of the Act are replaced by the following:
Extension of meaning of “related”
(4) For the purposes of this subsection and subsections (2) and (3), in determining if, at a particular time, a person or partnership is related to another person or partnership, the rules in section 251 are to be applied as if,
(a) a partnership (other than a partnership in respect of which any amount of the income or capital of the partnership that any entity may receive directly from the partnership at any time as a member of the partnership depends on the exercise by any entity of, or the failure by any entity to exercise, a discretionary power) were a corporation having capital stock of a single class divided into 100 issued shares and each member of the partnership owned, at the particular time, that proportion of the issued shares of that class that
(i) the fair market value of the member’s interest in the partnership at the particular time
is of
(ii) the fair market value of all interests in the partnership at the particular time; and
(b) a trust (other than a trust in respect of which any amount of the income or capital of the trust that any entity may receive directly from the trust at any time as a beneficiary under the trust depends on the exercise by any entity of, or the failure by any entity to exercise, a discretionary power) were a corporation having capital stock of a single class divided into 100 issued shares and each beneficiary under the trust owned, at the particular time, that proportion of the issued shares of that class that
(i) the fair market value of the beneficiary’s beneficial interest in the trust at the particular time
is of
(ii) the fair market value at that time of all beneficial interests in the trust.
(7) Subsections (1) and (2) apply to taxation years that end after February 22, 1994, except that any election made under paragraph (d.3) of the definition “mark-to-market property” in subsection 142.2(1) of the Act, as enacted by subsection (2), is deemed to have been made on a timely basis if it is filed with the Minister of National Revenue on or before the taxpayer’s filing-due date for the taxpayer’s taxation year in which this Act is assented to.
(8) Subsection (3) applies to taxation years that begin after September 2006 except that for taxation years that begin before November 7, 2007, the definition “mark-to-market property” in subsection 142.2(1) of the Act, as enacted by subsection (3), is to be read without its paragraph (d).
(9) Subsections (4) to (6) apply to taxation years that begin after September 2006 except that any election made under paragraph (d) of the definition “excluded property” in subsection 142.2(1) of the Act, as enacted by subsection (4), is deemed to have been made on a timely basis if it is filed with the Minister of National Revenue on or before the taxpayer’s filing-due date for the taxpayer’s taxation year in which this Act is assented to.
47. (1) Section 142.5 of the Act is amended by adding the following after subsection (8):
Marginal note:Application of subsection (8.2)
(8.1) Subsection (8.2) applies to a taxpayer for its transition year if
(a) subsection (2) deems the taxpayer to have disposed of a particular specified debt obligation immediately before the end of its transition year (in subsection (8.2) referred to as “the particular disposition”); and
(b) the particular specified debt obligation was owned by the taxpayer at the end of its base year and was not a mark-to-market property of the taxpayer for its base year.
Marginal note:Rules applicable to first deemed disposition of debt obligation
(8.2) If this subsection applies to a taxpayer for its transition year, the following rules apply to the taxpayer in respect of the particular disposition:
(a) subsection 20(21) does not apply to the taxpayer in respect of the particular disposition; and
(b) if section 12.4 does not apply to the taxpayer in respect of the particular disposition, there shall be included in computing the taxpayer’s income for its transition year the amount, if any, by which
(i) the total of all amounts each of which is
(A) an amount deducted under paragraph 20(1)(l) in respect of the particular specified debt obligation of the taxpayer in computing the taxpayer’s income for its base year, or
(B) an amount deducted under paragraph 20(1)(p) in respect of the particular specified debt obligation of the taxpayer in computing the taxpayer’s income for a taxation year that preceded its transition year,
exceeds
(ii) the total of all amounts each of which is
(A) an amount included under paragraph 12(1)(d) in respect of the particular specified debt obligation of the taxpayer in computing the taxpayer’s income for its transition year, or
(B) an amount included under paragraph 12(1)(i) in respect of the particular specified debt obligation of the taxpayer in computing the taxpayer’s income for its transition year or a preceding taxation year.
(2) Subsection (1) applies to taxation years that begin after September 2006.
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