Technical Tax Amendments Act, 2012 (S.C. 2013, c. 34)
Full Document:
Assented to 2013-06-26
281. (1) Subsection 134.1(2) of the Act is replaced by the following:
Marginal note:Application
(2) For the purposes of applying subsections 104(10) and (11) and 133(6) to (9) (other than the definition “non-resident-owned investment corporation” in subsection 133(8)), section 212 and any tax treaty, a corporation described in subsection (1) is deemed to be a non-resident-owned investment corporation in its first non-NRO year in respect of dividends paid in that year on shares of its capital stock to a non-resident person, to a trust for the benefit of non-resident persons or their unborn issue or to a non-resident-owned investment corporation.
(2) Subsection (1) applies to a corporation that ceases to be a non-resident-owned investment corporation because of a transaction or an event that occurs, or a circumstance that arises, in a taxation year of the corporation that ends after February 27, 2000.
282. (1) Subsection 135.1(7) of the Act is replaced by the following:
Marginal note:Withholding on redemption
(7) A person or partnership (in this subsection referred to as the “redeeming entity”) that redeems, acquires or cancels a shareholder’s share shall withhold and forthwith remit to the Receiver General, on account of the shareholder’s tax liability, 15% from the amount otherwise payable on the redemption, acquisition or cancellation, if
(a) the share was, at the time it was issued, a tax deferred cooperative share;
(b) the redeeming entity is the corporation that issued the share, or a person or partnership with whom the corporation does not deal at arm’s length; and
(c) the shareholder is not a trust whose taxable income is exempt from tax under this Part because of paragraph 149(1)(r) or (x).
(2) Section 135.1 of the Act is amended by adding the following after subsection (8):
Marginal note:Application of subsection (10)
(9) Subsection (10) applies in respect of the disposition, after September 28, 2009, by a taxpayer of a tax deferred cooperative share (in this subsection and subsection (10) referred to as the “old share”) of an agricultural cooperative corporation if
(a) the disposition results from the acquisition, cancellation or redemption of the old share in the course of a reorganization of the capital of the corporation;
(b) in exchange for the old share the corporation issues to the taxpayer a share (in this subsection and subsection (10) referred to as the “new share”) that is described in all of paragraphs (b) to (d) of the definition “tax deferred cooperative share” in subsection (1); and
(c) the amount of paid-up capital, and the amount, if any, that the taxpayer is entitled to receive on a redemption, acquisition or cancellation, of the new share are equal to those amounts, respectively, in respect of the old share.
Marginal note:Shares issued on corporate reorganizations
(10) If this subsection applies in respect of an exchange of a taxpayer’s old share for a new share, for the purposes of this section (other than subsection (9)),
(a) the new share issued in exchange for the old share is deemed to have been issued, pursuant to an allocation in proportion to patronage, at the time the old share was issued; and
(b) provided that no person or partnership receives at any time any consideration (other than the new share) in exchange for the old share, for the purposes of subsections (2) and (7) the taxpayer is deemed to have disposed of the old share for nil proceeds.
(3) Subsection (1) applies to redemptions, acquisitions and cancellations that occur after 2007.
(4) Subsection (2) is deemed to have come into force on September 29, 2009, except that in its application to an exchange of shares described by subparagraph 87(2)(s)(ii) of the Act, as enacted by subsection 223(8), that occurs before October 31, 2011,
(a) with respect to a new share received on the exchange that has been disposed of before October 31, 2011, paragraph 135.1(10)(a) of the Act, as enacted by subsection (2), is to be read as follows:
(a) the new share issued in exchange for the old share is deemed to have been issued at the time the old share was issued; and
and
(b) paragraph 135.1(10)(b) of the Act, as enacted by subsection (2), is to be read as follows:
(b) for the purposes of subsections (2) and (7) the taxpayer is deemed to have disposed of the old share for nil proceeds.
283. (1) Subsection 136(1) of the Act is replaced by the following:
Marginal note:Cooperative not private corporation
136. (1) Notwithstanding any other provision of this Act, a cooperative corporation that would, if this Act were read without reference to this section, be a private corporation is deemed not to be a private corporation except for the purposes of sections 15.1, 123.4, 125, 125.1, 127, 127.1, 152 and 157, the definition “mark-to-market property” in subsection 142.2(1) and the definition “small business corporation” in subsection 248(1) as it applies for the purpose of paragraph 39(1)(c).
(2) Subsection 136(2) of the Act is amended by striking out “and” at the end of paragraph (b) and by replacing paragraph (c) with the following:
(c) at least 90% of its members are individuals, other cooperative corporations, or corporations or partnerships that carry on the business of farming; and
(d) at least 90% of its shares, if any, are held by members described in paragraph (c) or by trusts governed by registered retirement savings plans, registered retirement income funds, TFSAs or registered education savings plans, the annuitants, holders or subscribers under which are members described in that paragraph.
(3) Subsection (1) applies to the 2001 and subsequent taxation years.
(4) Subsection (2) applies to the 1998 and subsequent taxation years, except that, in its application to taxation years that end before 2009, paragraph 136(2)(d) of the Act, as enacted by subsection (2), is to be read as follows:
(d) at least 90% of its shares, if any, are held by members described in paragraph (c) or by trusts governed by registered retirement savings plans, registered retirement income funds or registered education savings plans, the annuitants or subscribers under which are members described in that paragraph.
284. (1) Paragraph 137(4.3)(a) of the Act is replaced by the following:
(a) the preferred-rate amount of a corporation at the end of a taxation year is an amount equal to the total of its preferred-rate amount at the end of its immediately preceding taxation year and 100/17 of the amount deductible under section 125 from the tax for the year otherwise payable by it under this Part;
(2) The definition “member” in subsection 137(6) of the Act is replaced by the following:
“member”
« membre »
“member”, of a credit union, means
(a) a person who is recorded as a member on the records of the credit union and is entitled to participate in and use the services of the credit union, and
(b) a registered retirement savings plan, a registered retirement income fund, a TFSA or a registered education savings plan, the annuitant, holder or subscriber under which is a person described in paragraph (a).
(3) Subsection 137(7) of the Act is replaced by the following:
Marginal note:Credit union not private corporation
(7) Notwithstanding any other provision of this Act, a credit union that would, if this Act were read without reference to this section, be a private corporation is deemed not to be a private corporation except for the purposes of sections 123.1, 123.4, 125, 127, 127.1, 152 and 157 and the definition “small business corporation” in subsection 248(1) as it applies for the purpose of paragraph 39(1)(c).
(4) Subsection (1) applies to the 2008 and subsequent taxation years, except that, in the application of paragraph 137(4.3) of the Act, as amended by subsection (1), to a particular taxation year of a credit union that began in 2007 and ended in 2008, the preferred-rate amount of the credit union at the end of the particular taxation year is equal to the total of
(a) the preferred-rate amount of the credit union at the end of the taxation year that immediately preceded the particular taxation year; and
(b) the total of
(i) that proportion of the amount obtained by multiplying 25/4 by the amount deductible under section 125 of the Act for the particular taxation year, that the number of days in the particular taxation year that are in 2007 is of the number of days in the particular taxation year, and
(ii) that proportion of the amount obtained by multiplying 100/17 by the amount deductible under section 125 of the Act for the particular taxation year, that the number of days in the particular taxation year that are in 2008 is of the number of days in the particular taxation year.
(5) Subsection (2) applies to the 1996 and subsequent taxation years except that, in its application to taxation years that end before 2009, paragraph (b) of the definition “member” in subsection 137(6) of the Act, as enacted by subsection (2), is to be read as follows:
(b) a registered retirement savings plan, a registered retirement income fund or a registered education savings plan, the annuitant or subscriber under which is a person described in paragraph (a).
(6) Subsection (3) applies to the 2001 and subsequent taxation years.
285. (1) Subsection 137.1(2) of the Act is replaced by the following:
Marginal note:Amounts not included in income
(2) The following amounts shall not be included in computing the income of a deposit insurance corporation for a taxation year:
(a) any premium or assessment received, or receivable, by the corporation in the year from a member institution; and
(b) any amount received by the corporation in the year from another deposit insurance corporation to the extent that that amount can reasonably be considered to have been paid out of amounts referred to in paragraph (a) received by that other deposit insurance corporation in any taxation year.
(2) Subsection 137.1(4) of the Act is amended by striking out “or” at the end of paragraph (c) and by adding the following after paragraph (c):
(d) any amount paid by it to another deposit insurance corporation that is, because of paragraph (2)(b), not included in computing the income of that other deposit insurance corporation; or
(3) Subsections (1) and (2) apply to the 1998 and subsequent taxation years.
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