Income Tax Regulations

301 (1) For the purposes of this Part and section 148 of the Act, life annuity contract means any contract under which a person authorized under the laws of Canada or a province to carry on in Canada an annuities business agrees to make annuity payments to an individual (in this section referred to as “the annuitant”) or jointly to two or more individuals (each of whom is referred to as “the annuitant” in this section), which payments are, by the terms of the contract,

• (a) to be paid annually or at more frequent periodic intervals;

• (b) to commence on a specified day; and

• (c) to continue throughout the lifetime of the annuitant or one or more of the annuitants.

• (d) [Repealed, SOR/82-499, s. 2]

(2) For the purposes of subsection (1), a contract shall not fail to be a life annuity contract by reason that

• (a) the contract provides that the annuity payments may be assigned by the annuitant or owner;

• (b) the contract provides for annuity payments to be made for a period ending upon the death of the annuitant or for a specified period of not less than 10 years, whichever is the lesser;

• (c) the contract provides for annuity payments to be made for a specified period or throughout the lifetime of the annuitant, whichever is longer, to the annuitant and thereafter, if the specified period is the longer, to a specified person;

• (d) the contract provides, in addition to the annuity payments to be made throughout the lifetime of the annuitant, for a payment to be made upon the annuitant’s death;

• (e) the contract provides that the date

  • (i) on which the annuity payments commence, or

  • (ii) on which the contract holder becomes entitled to proceeds of the disposition,

  may be changed with respect to the whole contract or any portion thereof at the option of the annuitant or owner; or

• (f) the contract provides that all or a portion of the proceeds payable at any particular time under the contract may be received in the form of an annuity contract other than a life annuity contract.