Income Tax Act

Marginal note:Definitions

• 207.5 (1) In this Part,

  RCA trust

  fiducie de convention de retraite

  RCA trust under a retirement compensation arrangement means

  • (a) any trust deemed by subsection 207.6(1) to be created in respect of subject property of the arrangement, and

  • (b) any trust governed by the arrangement; (fiducie de convention de retraite)

  refundable tax

  impôt remboursable

  refundable tax of a retirement compensation arrangement at the end of a taxation year of an RCA trust under the arrangement means the amount, if any, by which the total of

  • (a) 50% of all contributions made under the arrangement while it was a retirement compensation arrangement and before the end of the year, and

  • (b) 50% of the amount, if any, by which

    • (i) the total of all amounts each of which is the income (determined as if this Act were read without reference to paragraph 82(1)(b)) of an RCA trust under the arrangement from a business or property for the year or a preceding taxation year or a capital gain of the trust for the year or a preceding taxation year,

    exceeds

    • (ii) the total of all amounts each of which is a loss of an RCA trust under the arrangement from a business or property for the year or a preceding taxation year or a capital loss of the trust for the year or a preceding taxation year,

  exceeds

  • (c) 50% of all amounts paid as distributions to one or more persons (including amounts that are required by paragraph 12(1)(n.3) to be included in computing the recipient’s income) under the arrangement while it was a retirement compensation arrangement and before the end of the year, other than a distribution paid where it is established, by subsequent events or otherwise, that the distribution was paid as part of a series of payments and refunds of contributions under the arrangement; (impôt remboursable)

  subject property of a retirement compensation arrangement

  bien déterminé d’une convention de retraite

  subject property of a retirement compensation arrangement means property that is held in connection with the arrangement. (bien déterminé d’une convention de retraite)

• Marginal note:Election

  (2) Notwithstanding the definition refundable tax in subsection 207.5(1), where the custodian of a retirement compensation arrangement so elects in the return under this Part for a taxation year of an RCA trust under the arrangement and all the subject property, if any, of the arrangement (other than a right to claim a refund under subsection 164(1) or 207.7(2)) at the end of the year consists only of cash, debt obligations, shares listed on a designated stock exchange, or any combination thereof, an amount equal to the total of

  • (a) the amount of that cash at the end of the year,

  • (b) the total of all amounts each of which is the greater of the principal amount of such a debt obligation outstanding at the end of the year and the fair market value of the obligation at the end of the year, and

  • (c) the fair market value of those shares at the end of the year

  shall be deemed for the purposes of this Part to be the refundable tax of the arrangement at the end of the year.