B

is the total of all amounts (other than any amount paid on account of or in satisfaction of a judgement) each of which is an amount of interest paid in the year (or in any of the five preceding taxation years that are after 1997, to the extent that it was not included in computing a deduction under this section for any other taxation year) by the individual or a person related to the individual on a loan made to, or other amount owing by, the individual under the Canada Student Loans Act, the Canada Student Financial Assistance Act, the Apprentice Loans Act or a law of a province governing the granting of financial assistance to students at the post-secondary school level.

Marginal note:Ordering of credits

118.92 In computing an individual’s tax payable under this Part, the following provisions shall be applied in the following order: subsections 118(1) and (2), section 118.7, subsections 118(3) and (10) and sections 118.01, 118.02, 118.031, 118.04, 118.05, 118.06, 118.07, 118.3, 118.61, 118.5, 118.6, 118.9, 118.8, 118.2, 118.1, 118.62 and 121.

• (ii) can reasonably be considered to be income derived

  • (A) from the provision of property or services by a partnership or trust to, or in support of, a business carried on by

    • (I) a person who is related to the individual at any time in the year,

    • (II) a corporation of which a person who is related to the individual is a specified shareholder at any time in the year, or

    • (III) a professional corporation of which a person related to the individual is a shareholder at any time in the year, or

  • (B) from a business of, or the rental of property by, a particular partnership or trust, if a person who is related to the individual at any time in the year

    • (I) is actively engaged on a regular basis in the activities of the particular partnership or trust related to earning income from a business or the rental of property, or

    • (II) in the case of a particular partnership, has an interest in the particular partnership directly or indirectly through one or more other partnerships, or

• (c) a portion of an amount included because of the application of subsection 104(13) or 105(2) in respect of a trust (other than a mutual fund trust or a trust that is deemed to be in existence by subsection 143(1)) in computing the individual’s income for the year, to the extent that the portion

• (D) to be income derived from a business of, or the rental of property by, a particular partnership or trust, if a person who is related to the individual at any time in the year is actively engaged on a regular basis in the activities of the particular partnership or trust related to earning income from a business or the rental of property.

Marginal note:Tax payable by trust

• 122. (1) Notwithstanding section 117, the tax payable under this Part for a taxation year by a trust (other than a graduated rate estate or qualified disability trust) is the total of

• (c) if subsection (2) applies to the trust for the taxation year, the amount determined by the formula

  A – B

  where

  A

  is the amount that would be determined for B for the year if

  • (i) the rate of tax payable under this Part by the trust for each taxation year referred to in the description of B were 29%, and

  • (ii) the trust’s taxable income for a particular taxation year referred to in the description of B were reduced by the total of

    • (A) the amount, if any, that was paid or distributed in satisfaction of all or part of an individual’s interest as a beneficiary under the trust if

      • (I) the individual was an electing beneficiary of the trust for the particular year,

      • (II) the payment or distribution can reasonably be considered to be made out of that taxable income, and

      • (III) the payment or distribution was made in a taxation year referred to in the description of B,

    • (B) the amount that is the portion of the tax payable under this Part by the trust for the particular year that can reasonably be considered to relate to the amount determined under clause (A), and

    • (C) the amount that is the portion of the tax payable, under the law of the province in which the trust is resident for the particular year, that can reasonably be considered to relate to the amount determined under clause (A), and

  B

  is the total of all amounts each of which is the amount of tax payable under this Part by the trust for a taxation year that precedes the year if that preceding taxation year is

  • (i) the later of

    • (A) the first taxation year for which the trust was a qualified disability trust, and

    • (B) the last taxation year, if any, for which subsection (2) applied to the trust, or

  • (ii) a taxation year that ends after the taxation year described in subparagraph (i).

• Marginal note:Credits available to trusts

  (1.1) No deduction may be made under this subdivision (other than section 118.1, 120.2 or 121) in computing the tax payable by a trust for a taxation year.

• Marginal note:Qualified disability trust — application of (1)(c)

  (2) This subsection applies to a trust for a particular taxation year if the trust was a qualified disability trust for a preceding taxation year and

  • (a) none of the beneficiaries under the trust at the end of the particular year was an electing beneficiary of the trust for a preceding year;

  • (b) the particular year ended immediately before the trust ceased to be resident in Canada; or

  • (c) an amount is paid or distributed in the particular year to a beneficiary under the trust in satisfaction of all or part of the beneficiary’s interest in the trust unless

    • (i) the beneficiary is an electing beneficiary of the trust for the particular year or a preceding year,

    • (ii) the amount is deducted under paragraph 104(6)(b) in computing the trust’s income for the particular year, or

    • (iii) the amount is paid or distributed in satisfaction of a right to enforce payment of an amount that was deducted under paragraph 104(6)(b) in computing the trust’s income for a preceding year.

“beneficiary”

« bénéficiaire »

“beneficiary”, under a trust, includes a person beneficially interested in the trust.

“electing beneficiary”

« bénéficiaire optant »

“electing beneficiary”, for a taxation year of a qualified disability trust, means a beneficiary under the trust that for the year

• (a) makes an election described in clause (a)(iii)(A) of the definition “qualified disability trust” in this subsection; and

• (b) is described in paragraph (b) of that definition.

“qualified disability trust”

« fiducie admissible pour personne handicapée »

“qualified disability trust”, for a taxation year (in this definition referred to as the “trust year”), means a trust, if

• (a) the trust

  • (i) is, at the end of the trust year, a testamentary trust that arose on and as a consequence of a particular individual’s death,

  • (ii) is resident in Canada for the trust year, and

  • (iii) includes in its return of income under this Part for the trust year

    • (A) an election, made jointly with one or more beneficiaries under the trust in prescribed form, to be a qualified disability trust for the trust year, and

    • (B) the Social Insurance Number of each of those beneficiaries;

• (b) each of those beneficiaries is an individual, named as a beneficiary by the particular individual in the instrument under which the trust was created,

  • (i) in respect of whom paragraphs 118.3(1)(a) to (b) apply for the individual’s taxation year (in this definition referred to as the “beneficiary year”) in which the trust year ends, and

  • (ii) who does not jointly elect with any other trust, for a taxation year of the other trust that ends in the beneficiary year, to be a qualified disability trust; and

• (c) subsection (2) does not apply to the trust for the trust year.

Subdivision a.3Child Fitness Tax Credit

Marginal note:Definitions

• 122.8 (1) The following definitions apply in this section.

  “eligible fitness expense”

  « dépense admissible pour activités physiques »

  “eligible fitness expense” in respect of a qualifying child of an individual for a taxation year means the amount of a fee paid to a qualifying entity (other than an amount paid to a person that is, at the time the amount is paid, the individual’s spouse or common-law partner or another individual who is under 18 years of age) to the extent that the fee is attributable to the cost of registration or membership of the qualifying child in a prescribed program of physical activity and, for the purposes of this section, that cost

  • (a) includes the cost to the qualifying entity of the program in respect of its administration, instruction, rental of required facilities, and uniforms and equipment that are not available to be acquired by a participant in the program for an amount less than their fair market value at the time, if any, they are so acquired; and

  • (b) does not include

    • (i) the cost of accommodation, travel, food or beverages, or

    • (ii) any amount deductible under section 63 in computing any person’s income for any taxation year.

  “qualifying child”

  « enfant admissible »

  “qualifying child” of an individual for a taxation year means a child of the individual who is, at the beginning of the year,

  • (a) under 16 years of age; or

  • (b) in the case where an amount is deductible under section 118.3 in computing any person’s tax payable under this Part for the year in respect of that child, under 18 years of age.

  “qualifying entity”

  « entité admissible »

  “qualifying entity” means a person or partnership that offers one or more prescribed programs of physical activity.

  “return of income”

  « déclaration de revenu »

  “return of income” filed by an individual for a taxation year means a return of income (other than a return of income filed under subsection 70(2) or 104(23), paragraph 128(2)(e) or subsection 150(4)) that is required to be filed for the year or that would be required to be filed if the individual had tax payable under this Part for the year.

• Marginal note:Deemed overpayment

  (2) An individual who files a return of income for a taxation year and who makes a claim under this subsection is deemed to have paid, at the end of the year, on account of tax payable under this Part for the year, an amount equal to the amount determined by the formula

  A × B

  where

  A

  is the appropriate percentage for the year; and

  B

  is the total of all amounts each of which is, in respect of a qualifying child of the individual for the year, the lesser of $1,000 and the amount determined by the formula

  C – D

  where

  C

  is the total of all amounts each of which is an amount paid in the year by the individual, or by the individual’s spouse or common law partner, that is an eligible fitness expense in respect of the qualifying child of the individual, and

  D

  is the total of all amounts that any person is or was entitled to receive, each of which relates to an amount included in computing the value of C in respect of the qualifying child that is the amount of a reimbursement, allowance or any other form of assistance (other than an amount that is included in computing the income for any taxation year of that person and that is not deductible in computing the taxable income of that person).

• Marginal note:Child with disability

  (3) An individual who files a return of income for a taxation year and who makes a claim under this subsection is deemed to have paid, in respect of a qualifying child of the individual, at the end of the year, on account of tax payable under this Part for the year, an amount equal to $500 multiplied by the appropriate percentage for the year, if

  • (a) the amount referred to in the description of B in subsection (2) is $100 or more; and

  • (b) an amount is deductible in respect of the qualifying child under section 118.3 in computing any person’s tax payable under this Part for the year.

• Marginal note:Apportionment of overpayment

  (4) If more than one individual is entitled to make a claim under this section for a taxation year in respect of a qualifying child, the total of all amounts deemed to have been paid shall not exceed the maximum amount that could be deemed to have been paid for the year by any one of those individuals in respect of that qualifying child if that individual were the only individual entitled to claim an amount for the year under this section in respect of that qualifying child. If the individuals cannot agree as to what portion of the maximum amount each can so claim, the Minister may fix the portions.

• Marginal note:Effect of bankruptcy

  (5) For the purposes of this subdivision, if an individual becomes bankrupt in a particular calendar year, notwithstanding subsection 128(2), any reference to the taxation year of the individual (other than in this subsection) is deemed to be a reference to the particular calendar year.

• Marginal note:Part-year residents

  (6) If an individual is resident in Canada throughout part of a taxation year and is non-resident throughout another part of the year, the total of the amounts that are deemed to be paid by the individual under subsection (2) and (3) for the year cannot exceed the lesser of

  • (a) the total of

    • (i) the amounts deemed to be paid under those subsections that can reasonably be considered as wholly applicable to the period or periods in the year throughout which the individual is not resident in Canada, computed as though that period or those periods were the whole taxation year, and

    • (ii) the amounts deemed to be paid under those subsections that can reasonably be considered as wholly applicable to the period or periods in the year throughout which the individual is resident in Canada, computed as though that period or those periods were the whole taxation year, and

  • (b) the total of the amounts that would have been deemed to have been paid under those subsections for the year had the individual been resident in Canada throughout the year.

• Marginal note:Non-residents

  (7) Subsections (2) and (3) do not apply in respect of a taxation year of an individual if the individual is, at no time in the year, resident in Canada, unless all or substantially all the individual’s income for the year is included in computing the individual’s taxable income earned in Canada for the year.