Budget Implementation Act, 2009 (S.C. 2009, c. 2)
Full Document:
Assented to 2009-03-12
19. (1) Paragraph 87(2)(g.2) of the Act is replaced by the following:
Marginal note:Financial institution rules
(g.2) for the purposes of paragraphs 142.4(4)(c) and (d) and subsections 142.5(5) and (7), 142.51(11) and 142.6(1), the new corporation is deemed to be the same corporation as, and a continuation of, each predecessor corporation;
(2) Subsection 87(2) of the Act is amended by adding the following after paragraph (s):
Marginal note:Deemed SIFT wind-up corporation
(s.1) if a predecessor corporation was a SIFT wind-up corporation immediately before the amalgamation, the new corporation is deemed to be a SIFT wind-up corporation;
(3) Subsection 87(2.2) of the Act is replaced by the following:
Marginal note:Amalgamation of insurers
(2.2) Where there has been an amalgamation and one or more of the predecessor corporations was an insurer, the new corporation is, notwithstanding subsection (2), deemed, for the purposes of paragraphs 12(1)(d), (e), (e.1), (i) and (s), subsection 12.5(8), paragraphs 20(1)(l), (l.1), (p) and (jj) and 20(7)(c), subsections 20(22) and 20.4(4), sections 138, 138.1, 140, 142 and 148 and Part XII.3, to be the same corporation as, and a continuation of, each of those predecessor corporations.
(4) Subsections (1) and (3) apply to taxation years that begin after September 2006.
(5) Subsection (2) applies after December 19, 2007.
20. (1) Subparagraph 88(1)(g)(i) of the Act is replaced by the following:
(i) for the purposes of paragraphs 12(1)(d), (e), (e.1), (i) and (s), subsection 12.5(8), paragraphs 20(1)(l), (l.1), (p) and (jj) and 20(7)(c), subsections 20(22) and 20.4(4), sections 138, 138.1, 140, 142 and 148 and Part XII.3, the parent is deemed to be the same corporation as, and a continuation of, the subsidiary, and
(2) Subsection (1) applies to taxation years that begin after September 2006.
21. (1) The Act is amended by adding the following after section 88:
Marginal note:Application
88.1 (1) Subsection (2) applies to a trust’s distribution of property to a taxpayer if
(a) the distribution is a SIFT trust wind-up event;
(b) the trust is
(i) a SIFT wind-up entity whose only beneficiary, at all times at which the trust makes a distribution that is a SIFT trust wind-up event, is a taxable Canadian corporation, or
(ii) a trust whose only beneficiary, at all times at which the trust makes a distribution that is a SIFT trust wind-up event, is another trust described by subparagraph (i);
(c) where the trust is a SIFT wind-up entity, the distribution occurs no more than 60 days after the earlier of
(i) the first SIFT trust wind-up event of the trust, and
(ii) the first distribution to the trust that is a SIFT trust wind-up event of another trust; and
(d) if the property is shares of the capital stock of a taxable Canadian corporation,
(i) the property was not acquired by the trust on a distribution to which subsection 107(3.1) applies, and
(ii) the trust elects in writing, filed with the Minister on or before the trust’s filing-due date for its taxation year that includes the time of the distribution, that this section apply to the distribution.
Marginal note:SIFT trust wind-up event
(2) If this subsection applies to a trust’s distribution of property to a taxpayer, subsections 88(1) to (1.7), and section 87 and paragraphs 256(7)(a) to (e) as they apply for the purposes of those subsections, apply, with any modifications that the circumstances require, as if
(a) the trust were a taxable Canadian corporation (in this subsection referred to as the “subsidiary”) that is not a private corporation;
(b) where the taxpayer is a SIFT wind-up entity, the taxpayer were a taxable Canadian corporation that is not a private corporation;
(c) the distribution were a winding-up of the subsidiary;
(d) the taxpayer’s interest as a beneficiary under the trust were shares of a single class of shares of the capital stock of the subsidiary owned by the taxpayer;
(e) paragraph 88(1)(b) deemed the taxpayer’s proceeds of disposition of the shares described in paragraph (d) and owned by the taxpayer immediately before the distribution to be equal to the adjusted cost base to the taxpayer of the taxpayer’s interest as a beneficiary under the trust immediately before the distribution;
(f) each trust, a majority-interest beneficiary (in this subsection, within the meaning assigned by section 251.1) of which is another trust that is by operation of this subsection treated as if it were a corporation, were a corporation; and
(g) except for the purposes of subsections 88(1.1) and (1.2), the taxpayer last acquired control of the subsidiary and of each corporation (including a trust that is by operation of this subsection treated as if it were a corporation) controlled by the subsidiary at the time, if any, at which the taxpayer last became a majority-interest beneficiary of the trust.
(2) Subsection (1) applies after July 14, 2008, except that subsection 88.1(1) of the Act, as enacted by subsection (1), is to be read without reference to its paragraph (c) in its application to a trust’s distribution of property, if the distribution occurs no more than 60 days after the day on which this Act is assented to.
22. (1) The definition “general rate income pool” in subsection 89(1) of the Act is replaced by the following:
“general rate income pool”
« compte de revenu à taux général »
“general rate income pool” at the end of a particular taxation year, of a taxable Canadian corporation that is a Canadian-controlled private corporation or a deposit insurance corporation in the particular taxation year, is the positive or negative amount determined by the formula
A – B
where
- A
- is the positive or negative amount that would, before taking into consideration the specified future tax consequences for the particular taxation year, be determined by the formula
C + D + E + F – G
where
- C
- is the corporation’s general rate income pool at the end of its preceding taxation year,
- D
- is the amount, if any, that is the product of the corporation’s general rate factor for the particular taxation year multiplied by its adjusted taxable income for the particular taxation year,
- E
- is the total of all amounts each of which is
(a) an eligible dividend received by the corporation in the particular taxation year, or
(b) an amount deductible under section 113 in computing the taxable income of the corporation for the particular taxation year,
- F
- is the total of all amounts determined under subsections (4) to (6) in respect of the corporation for the particular taxation year, and
- G
- is
(a) unless paragraph (b) applies, the amount, if any, by which
(i) the total of all amounts each of which is the amount of an eligible dividend paid by the corporation in its preceding taxation year
exceeds
(ii) the total of all amounts each of which is an excessive eligible dividend designation made by the corporation in its preceding taxation year, or
(b) if subsection (4) applies to the corporation in the particular taxation year, nil, and
- B
- is the amount determined by the formula
H × (I – J)
where
- H
- is the corporation’s general rate factor for the particular taxation year,
- I
- is the total of the corporation’s full rate taxable incomes (as would be defined in the definition “full rate taxable income” in subsection 123.4(1), if that definition were read without reference to its subparagraphs (a)(i) to (iii)) for the corporation’s preceding three taxation years, determined without taking into consideration the specified future tax consequences, for those preceding taxation years, that arise in respect of the particular taxation year, and
- J
- is the total of the corporation’s full rate taxable incomes (as would be defined in the definition “full rate taxable income” in subsection 123.4(1), if that definition were read without reference to its subparagraphs (a)(i) to (iii)) for those preceding taxation years;
(2) Subparagraph (b)(iii) of the definition “paid-up capital” in subsection 89(1) of the Act is replaced by the following:
(iii) where the particular time is after March 31, 1977, an amount equal to the paid-up capital in respect of that class of shares at the particular time, computed without reference to the provisions of this Act except subsections 51(3) and 66.3(2) and (4), sections 84.1 and 84.2, subsections 85(2.1), 85.1(2.1) and (8), 86(2.1), 87(3) and (9), 128.1(2) and (3), 138(11.7), 139.1(6) and (7), 192(4.1) and 194(4.1) and section 212.1,
(3) Subsection 89(1) of the Act is amended by adding the following in alphabetical order:
“adjusted taxable income”
« revenu imposable rajusté »
“adjusted taxable income” of a corporation for a taxation year is the amount determined by the formula
A – B – C
where
- A
- is
(a) unless paragraph (b) applies, the corporation’s taxable income for the taxation year, and
(b) if the corporation is a deposit insurance corporation in the taxation year, nil,
- B
- is the amount determined by multiplying the amount, if any, deducted by the corporation under subsection 125(1) for the taxation year by the quotient obtained by dividing 100 by the rate of the deduction provided under that subsection for the taxation year, and
- C
- is
(a) if the corporation is a Canadian-controlled private corporation in the taxation year, the lesser of the corporation’s aggregate investment income for the taxation year and the corporation’s taxable income for the taxation year, and
(b) in any other case, nil;
“general rate factor”
« facteur du taux géneral »
“general rate factor” of a corporation for a taxation year is the total of
(a) that proportion of 0.68 that the number of days in the taxation year that are before 2010 is of the number of days in the taxation year,
(b) that proportion of 0.69 that the number of days in the taxation year that are in 2010 is of the number of days in the taxation year,
(c) that proportion of 0.70 that the number of days in the taxation year that are in 2011 is of the number of days in the taxation year, and
(d) that proportion of 0.72 that the number of days in the taxation year that are after 2011 is of the number of days in the taxation year;
(4) Subsections (1) and (3) apply to the 2006 and subsequent taxation years.
(5) Subsection (2) applies after December 19, 2007.
- Date modified: