Economic Action Plan 2013 Act, No. 2 (S.C. 2013, c. 40)
Full Document:
Assented to 2013-12-12
61. (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, but for this section, be a private corporation is deemed not to be a private corporation except for the purposes of section 15.1, paragraphs 87(2)(vv) and (ww) (including, for greater certainty, in applying those paragraphs as provided under paragraph 88(1)(e.2)), the definitions “excessive eligible dividend designation”, “general rate income pool” and “low rate income pool” in subsection 89(1), subsections 89(4) to (6) and (8) to (10), sections 123.4, 125, 125.1, 127 and 127.1, the definition “mark-to-market property” in subsection 142.2(1), sections 152 and 157, subsection 185.2(3), the definition “small business corporation” in subsection 248(1) (as it applies for the purposes of paragraph 39(1)(c)) and subsection 249(3.1).
(2) Subsection (1) applies to taxation years that begin after December 21, 2012.
62. (1) Subsection 137(4.1) of the Act is replaced by the following:
Marginal note:Payments in respect of shares
(4.1) Notwithstanding any other provision of this Act, an amount paid or payable by a credit union to a person is deemed to be paid or payable, as the case may be, by the credit union as interest and to be received or receivable, as the case may be, by the person as interest, if
(a) the amount is in respect of a share held by the person of the capital stock of the credit union, other than an amount paid or payable as or on account of a reduction of the paid-up capital, redemption, acquisition or cancellation of the share by the credit union to the extent of the paid-up capital of the share;
(b) the share is not listed on a stock exchange; and
(c) the person is
(i) a member of the credit union, or
(ii) a member of another credit union if the share is issued by the credit union after March 28, 2012 and the other credit union is a member of the credit union.
(2) Subsection (1) applies to the 2012 and subsequent taxation years.
63. The portion of subsection 142.2(2) of the Act before paragraph (a) is replaced by the following:
Marginal note:Significant interest
(2) For the purposes of the definitions “excluded property” and “specified debt obligation” in subsection (1) and subsection 142.6(1.6), a taxpayer has a significant interest in a corporation at any time if
64. (1) Section 147.1 of the Act is amended by adding the following after subsection (18):
Marginal note:Reasonable error
(19) The administrator of a registered pension plan may make a payment (other than a payment made to avoid the revocation of the registration of the plan) that is a return of all or a portion of a contribution made by a member of the plan, or an employer who participates in the plan, if
(a) the contribution was made to the plan as a consequence of a reasonable error;
(b) the payment is made to the member or employer, as the case may be, who made the contribution; and
(c) the payment is made no later than December 31 of the year following the year in which the contribution was made.
(2) Subsection (1) applies to contributions made on or after the later of January 1, 2014 and the day on which this Act receives royal assent.
65. (1) Section 148 of the Act is amended by adding the following after subsection (4):
Marginal note:10/8 policy surrender
(5) If a policyholder has after March 20, 2013 and before April 2014 disposed of an interest in a 10/8 policy because of a partial or complete surrender of the policy, the policyholder may deduct in computing their income for the taxation year in which the disposition occurs an amount that does not exceed the least of
(a) the portion of an amount, included under subsection (1) in computing their income for the year in respect of the disposition, that is attributable to an investment account described in paragraph (b) of the definition “10/8 policy” in subsection 248(1) in respect of the policy,
(b) the total of all amounts each of which is an amount, to the extent that the amount has not otherwise been included in determining an amount under this paragraph, of a payment made after March 20, 2013 and before April 2014 that reduces the amount outstanding of a borrowing or policy loan, as the case may be, described in paragraph (a) of the definition “10/8 policy” in subsection 248(1) in respect of the policy, and
(c) the total of all amounts each of which is an amount, to the extent that the amount has not otherwise been included in determining an amount under this paragraph, that the policyholder is entitled to receive as a result of the disposition and that is paid after March 20, 2013 and before April 2014 out of an investment account described in paragraph (b) of the definition “10/8 policy” in subsection 248(1) in respect of the policy.
(2) Subsection (1) applies to taxation years that end after March 20, 2013.
66. (1) Subsection 149(10) of the Act is replaced by the following:
Marginal note:Becoming or ceasing to be exempt
(10) If at any time (in this subsection referred to as “that time”), a person — that is a corporation or, if that time is after September 12, 2013, a trust — becomes or ceases to be exempt from tax under this Part on its taxable income otherwise than by reason of paragraph (1)(t), the following rules apply:
(a) the taxation year of the person that would, but for this paragraph, have included that time is deemed to end immediately before that time, a new taxation year of the person is deemed to begin at that time and, for the purpose of determining the person’s fiscal period after that time, the person is deemed not to have established a fiscal period before that time;
(a.1) for the purpose of computing the person’s income for its first taxation year that ends after that time, the person is deemed to have deducted under sections 20, 138 and 140 in computing the person’s income for its taxation year that ended immediately before that time, the greatest amount that could have been claimed or deducted by the person for that year as a reserve under those sections;
(b) the person is deemed to have disposed, at the time (in this subsection referred to as the “disposition time”) that is immediately before the time that is immediately before that time, of each property held by the person immediately before that time for an amount equal to its fair market value at that time and to have reacquired the property at that time at a cost equal to that fair market value;
(c) for the purposes of applying sections 37, 65 to 66.4, 66.7, 111 and 126, subsections 127(5) to (36) and section 127.3 to the person, the person is deemed to be a new corporation or trust, as the case may be, the first taxation year of which began at that time; and
(d) there is to be deducted under paragraph 20(1)(b) in computing the person’s income from a business for the taxation year that ended immediately before that time the amount, if any, by which the person’s cumulative eligible capital immediately before the disposition time in respect of the business exceeds the total of
(i) 3/4 of the fair market value of the eligible capital property in respect of the business, and
(ii) the amount otherwise deducted under paragraph 20(1)(b) in computing the person’s income from the business for the taxation year that ended immediately before that time.
(2) Subsection (1) is deemed to have come into force on March 21, 2013.
67. (1) Paragraph 152(4)(c) of the Act is replaced by the following:
(b.1) an information return described in subsection 237.1(7) or 237.3(2) that is required to be filed in respect of a deduction or claim made by the taxpayer in relation to a tax shelter, or in respect of a tax benefit (as defined in subsection 245(1)) to the taxpayer from an avoidance transaction (as defined in subsection 245(3)), is not filed as and when required, and the assessment, reassessment or additional assessment is made before the day that is three years after the day on which the information return is filed;
(b.2) the assessment, reassessment or additional assessment is made before the day that is three years after the end of the normal reassessment period for the taxpayer in respect of the year and if
(i) the taxpayer, or a partnership of which the taxpayer is a member, has failed to file for the year a prescribed form as and when required under subsection 233.3(3) or to report on the prescribed form the information required in respect of a specified foreign property (as defined in subsection 233.3(1)) held by the taxpayer at any time during the year, and
(ii) the taxpayer has failed to report, in the return of income for the year, an amount in respect of a specified foreign property that is required to be included in computing the taxpayer’s income for the year;
(c) the taxpayer or person filing the return of income has filed with the Minister a waiver in prescribed form within the additional three-year period referred to in paragraph (b) or (b.1);
(c.1) the taxpayer or person filing the return of income has filed with the Minister a waiver in prescribed form within the additional three-year period referred to in paragraph (b.2); or
(2) The portion of subsection 152(4.01) of the Act before paragraph (a) is replaced by the following:
Marginal note:Extended period assessment
(4.01) Notwithstanding subsections (4) and (5), an assessment, reassessment or additional assessment to which paragraph (4)(a), (b), (b.1) or (c) applies in respect of a taxpayer for a taxation year may be made after the taxpayer’s normal reassessment period in respect of the year to the extent that, but only to the extent that, it can reasonably be regarded as relating to,
(3) The portion of paragraph 152(4.01)(b) of the Act before subparagraph (i) is replaced by the following:
(b) if paragraph (4)(b), (b.1) or (c) applies to the assessment, reassessment or additional assessment,
(4) Paragraph 152(4.01)(b) of the Act is amended by striking out “or” at the end of subparagraph (v), by adding “or” at the end of subparagraph (vi) and by adding the following after subparagraph (vi):
(vii) the deduction, claim or tax benefit referred to in paragraph (4)(b.1).
(5) Subsection 152(4.1) of the Act is replaced by the following:
Marginal note:If waiver revoked
(4.1) If the Minister would, but for this subsection, be entitled to reassess, make an additional assessment or assess tax, interest or penalties by virtue only of the filing of a waiver under subparagraph (4)(a)(ii) or paragraph (4)(c) or (c.1), the Minister may not make such a reassessment, additional assessment or assessment after the day that is six months after the date on which a notice of revocation of the waiver in prescribed form is filed.
(6) Subsections (1) and (5) apply to the 2013 and subsequent taxation years, except that, in its application to taxation years that end before March 21, 2013, subsection 152(4) of the Act, as amended by subsection (1), is to be read without reference to paragraph (b.1).
(7) Subsections (2) to (4) apply to taxation years that end after March 20, 2013.
- Date modified: