RECOMMENDATION

Her Excellency the Governor General recommends to the House of Commons the appropriation of public revenue under the circumstances, in the manner and for the purposes set out in a measure entitled “An Act respecting certain measures in response to COVID-19”.

Short Title

Marginal note:Short title

1 This Act may be cited as the COVID-19 Emergency Response Act.

PART 1Income Tax Act and Income Tax Regulations

R.S., c. 1 (5th Supp.)Income Tax Act

• 2 (1) Section 122.5 of the Income Tax Act is amended by adding the following after subsection (3):

  • Marginal note:COVID-19 — additional deemed payment

    (3.001) An eligible individual in relation to a month specified for a taxation year who files a return of income for the taxation year is deemed to have paid during the specified month on account of their tax payable under this Part for the taxation year an amount determined by the formula

    0.5(A − B)

    where

    A

    is the total of

    • (a) $580,

    • (b) $580 for the qualified relation, if any, of the individual in relation to the specified month,

    • (c) if the individual has no qualified relation in relation to the specified month and is entitled to deduct an amount for the taxation year under subsection 118(1) because of paragraph (b) of the description of B in that subsection in respect of a qualified dependant of the individual in relation to the specified month, $580,

    • (d) $306 times the number of qualified dependants of the individual in relation to the specified month, other than a qualified dependant in respect of whom an amount is included under paragraph (c) in computing the total for the specified month,

    • (e) if the individual has no qualified relation and has one or more qualified dependants, in relation to the specified month, $306, and

    • (f) if the individual has no qualified relation and no qualified dependant, in relation to the specified month, the lesser of $306 and 2% of the amount, if any, by which the individual’s income for the taxation year exceeds $9,412; and

    B

    is 5% of the amount, if any, by which the individual’s adjusted income for the taxation year in relation to the specified month exceeds $37,789.

• (2) Section 122.5 of the Act is amended by adding the following after subsection (3.01):

  • Marginal note:COVID-19 — shared-custody parent

    (3.02) Notwithstanding subsection (3.001), if an eligible individual is a shared-custody parent (within the meaning assigned by section 122.6, but with the words qualified dependant in that section having the meaning assigned by subsection (1)) in respect of one or more qualified dependants at the beginning of a month, the amount deemed by subsection (3.001) to have been paid during the specified month is equal to the amount determined by the following formula:

    0.5(A + B)

    where

    A

    is the amount determined by the formula in subsection (3.001), calculated without reference to this subsection; and

    B

    is the amount determined by the formula in subsection (3.001), calculated without reference to this subsection and subparagraph (b)(ii) of the definition eligible individual in section 122.6.

• (3) Section 122.5 of the Act is amended by adding the following after subsection (4):

  • Marginal note:COVID-19 — month specified

    (4.1) Notwithstanding subsection (4) and for the purposes of this section, the month specified in subsection (3.001) is May 2020 (or an earlier month designated by the Minister) and the taxation year is the 2018 taxation year.

3 Section 122.61 of the Act is amended by adding the following after subsection (1):

4 Section 146.3 of the Act is amended by adding the following after subsection (1.3):

• 5 (1) Paragraph 152(1)(b) of the Act is replaced by the following:

  • (b) the amount of tax, if any, deemed by subsection 120(2) or (2.2), 122.5(3) or (3.001), 122.51(2), 122.7(2) or (3), 122.8(4), 122.9(2), 122.91(1), 125.4(3), 125.5(3), 125.6(2), 127.1(1), 127.41(3) or 210.2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year.

• (2) Paragraph 152(1.2)(d) of the Act is replaced by the following:

  • (d) if the Minister determines the amount deemed by subsection 122.5(3) or (3.001) to have been paid by an individual for a taxation year to be nil, subsection (2) does not apply to the determination unless the individual requests a notice of determination from the Minister.

• (3) Paragraph 152(4.2)(b) of the Act is replaced by the following:

  • (b) redetermine the amount, if any, deemed by subsection 120(2) or (2.2), 122.5(3) or (3.001), 122.51(2), 122.7(2) or (3), 122.8(4), 122.9(2), 122.91(1), 127.1(1), 127.41(3) or 210.2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year or deemed by subsection 122.61(1) to be an overpayment on account of the taxpayer’s liability under this Part for the year.

• 6 (1) Section 153 of the Act is amended by adding the following after subsection (1.01):

  • Marginal note:COVID-19 — deemed remittance

    (1.02) For the purposes of this Act, if an eligible employer pays, at a particular time that is within the eligible period, eligible remuneration in respect of which a particular amount is required to be deducted or withheld under subsection (1), then the eligible employer is deemed to have remitted to the Receiver General at the particular time in respect of the particular amount, an amount equal to the least of

    • (a) the amount determined by the formula

      A − B

      where

      A

      is the prescribed amount, and

      B

      is the total of all amounts, each of which is an amount deemed to have been remitted by the eligible employer under this subsection prior to the particular time (and, if more than one such payment is made at the particular time, the eligible employer may designate the order in which the amounts are considered to have been paid),

    • (b) the amount determined by the formula

      C × D

      where

      C

      is the prescribed percentage, and

      D

      is the amount of the eligible remuneration, and

    • (c) the amount determined by the formula

      E × F

      where

      E

      is the prescribed amount, and

      F

      is the total number of eligible employees employed by the eligible employer during the eligible period.

  • Marginal note:Definitions — subsection (1.02)

    (1.03) The following definitions apply for the purposes of this subsection and subsection (1.02).

    eligible employee

    eligible employee means an individual who is employed in Canada. (employé admissible)

    eligible employer

    eligible employer means a person or partnership that

    • (a) employs one or more eligible employees;

    • (b) has, on March 18, 2020, a business number in respect of which the person or partnership is registered with the Minister to make remittances required under this section; and

    • (c) is any of

      • (i) a Canadian-controlled private corporation for the purposes of section 125 that

        • (A) would have a business limit for its last taxation year that ended before the start of the eligible period greater than nil, if the amount determined for paragraph 125(5.1)(b) were deemed to be nil, or

        • (B) if the corporation does not have a taxation year that ended before the start of the eligible period, would meet the condition in clause (A) if its taxation year ended immediately before the start of the eligible period,

      • (ii) an individual (other than a trust),

      • (iii) a partnership, all of the members of which are described in subparagraphs (i) to (iii) or (v),

      • (iv) a person exempt from tax under Part I because of paragraph 149(1)(l), and

      • (v) a registered charity. (employeur admissible)

    eligible period

    eligible period means the period beginning on March 18, 2020 and that ends on June 19, 2020. (période d’admissibilité)

    eligible remuneration

    eligible remuneration means salary, wages or other remuneration paid to an eligible employee during the eligible period. (rémunération admissible)

  • Marginal note:Deemed remittances under subsection (1.02)

    (1.04) For greater certainty, amounts deemed under subsection (1.02) to have been remitted to the Receiver General are deemed to not be held in trust under subsections 227(4) and (4.1).