Federal-Provincial Fiscal Arrangements Act (R.S.C., 1985, c. F-8)
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Act current to 2024-11-26 and last amended on 2024-06-20. Previous Versions
PART IV.01Transfer Payments — Tax in Respect of Stock Option Benefit Deferral Under Part I.01 of the Income Tax Act
Marginal note:Transfer payments — Consolidated Revenue Fund
12.02 Subject to this Act, the Minister may pay to a province, out of the Consolidated Revenue Fund, at such time as the Minister may determine, an amount equal to 1/3 of the tax payable under subparagraph 180.01(2)(c)(ii) of the Income Tax Act for a taxation year by a taxpayer who is resident in the province on the last day of that taxation year.
- 2010, c. 25, s. 144
Marginal note:Eligibility for payment
12.03 No payment may be made under this Part to a province if, in the opinion of the Minister, the province imposes or purports to impose a tax that is similar to the tax imposed under Part I.01 of the Income Tax Act.
- 2010, c. 25, s. 144
PART IV.1Transfer Payments with Respect to Preferred Share Dividend Taxes Under Parts IV.1 and VI.1 of the Income Tax Act
Marginal note:Transfer payments in respect of preferred share dividend taxes under Parts IV.1 and VI.1 of the Income Tax Act
12.1 (1) Subject to this Act, the Minister may, in respect of taxes payable under Parts IV.1 and VI.1 of the Income Tax Act by a corporation for a taxation year of the corporation ending in a fiscal year, pay to a province out of the Consolidated Revenue Fund, at such time as the Minister may determine, an amount for the fiscal year equal to thirty-five per cent of that proportion of the taxes so payable that
(a) the amount of taxable income of the corporation earned in that taxation year in that province determined in accordance with the provisions of regulations made under the Income Tax Act,
is of
(b) the corporation’s taxable income for that taxation year.
Marginal note:Where income of corporation is nil
(2) For the purposes of subsection (1), where a corporation’s taxable income for a taxation year would, but for this subsection, be nil, the corporation shall be deemed to have taxable income for the taxation year equal to $100.
- R.S., 1985, c. 46 (4th Supp.), s. 6
Marginal note:Eligibility for payments
12.2 (1) No payment may be made under this Part to a province for a fiscal year unless
(a) pursuant to a tax collection agreement, Canada has undertaken for the calendar year ending in the fiscal year to collect taxes imposed by the province under an Act of the legislature of the province imposing a tax on the income of corporations; or
(b) the Act of the legislature of the province imposing a tax on the income of corporations provides, in the opinion of the Minister, for a deduction in computing taxable income of a corporation for taxation years ending in the fiscal year of an amount that is not less than the amount deductible by the corporation for the year under paragraph 110(1)(k) of the Income Tax Act.
Marginal note:Idem
(2) No payment may be made under this Part to a province for a fiscal year where, in the opinion of the Minister, the province imposes or purports to impose a tax payable by corporations for taxation years ending in the fiscal year that is identical or similar to the taxes imposed under Parts IV.1 and VI.1 of the Income Tax Act.
- R.S., 1985, c. 46 (4th Supp.), s. 6
- 1990, c. 39, s. 56
- 1999, c. 31, s. 237(F)
- 2013, c. 34, s. 370
Marginal note:Information
12.3 A corporation shall furnish to the Minister of National Revenue any information that Minister may require for the purpose of determining the amount payable to a province under this Part in respect of the taxes payable by the corporation under Parts IV.1 and VI.1 of the Income Tax Act.
- R.S., 1985, c. 46 (4th Supp.), s. 6
PART IV.11Transfer Payments — Tax in Respect of Sift Trusts or Sift Partnerships
Marginal note:Definitions
12.31 The following definitions apply in this Part.
- SIFT entity
SIFT entity means a SIFT trust or a SIFT partnership. (entité intermédiaire de placement déterminée)
- SIFT partnership
SIFT partnership has the same meaning as in subsection 248(1) of the Income Tax Act. (société de personnes intermédiaire de placement déterminée)
- SIFT trust
SIFT trust has the same meaning as in subsection 248(1) of the Income Tax Act. (fiducie intermédiaire de placement déterminée)
- 2012, c. 31, s. 97
Marginal note:Permanent establishment
12.32 The definition permanent establishment in subsection 400(2) of the Income Tax Regulations, as it read on March 12, 2009 and as it is amended from time to time after that date, applies in determining the amount payable to a province under this Part.
- 2012, c. 31, s. 97
Marginal note:Transfer payments for SIFT entity with single permanent establishment
12.33 Subject to this Act, the Minister may pay to a province, in respect of tax payable under subsection 122(1) or 197(2) of the Income Tax Act by a SIFT entity that, in a taxation year, has a permanent establishment in the province and no permanent establishment outside the province, the amount determined by the formula
Z × Y
where
- Z
- is
(a) in respect of a taxation year that is after 2006 and before 2009 for which no election was made by the SIFT entity under subsection 34(4) of the Budget Implementation Act, 2008, 0.13, and
(b) in any other case, the amount determined under paragraph 414(3)(b) of the Income Tax Regulations in respect of the SIFT entity for the taxation year; and
- Y
- is
(a) for a SIFT entity that is a SIFT trust, the SIFT trust’s taxable SIFT trust distributions, as defined in subsection 122(3) of the Income Tax Act, for the taxation year, and
(b) for a SIFT entity that is a SIFT partnership, the SIFT partnership’s taxable non-portfolio earnings, as defined in subsection 197(1) of the Income Tax Act, for the taxation year.
- 2012, c. 31, s. 97
Marginal note:Transfer payments for SIFT entity with multiple permanent establishments
12.34 (1) Subject to this Act, the Minister may pay to a province, in respect of tax payable under subsection 122(1) or 197(2) of the Income Tax Act by a SIFT entity that, in a taxation year, has a permanent establishment in the province and a permanent establishment outside the province, the amount determined by the formula
(Z/Y) × (X × W)
where
- Z
- is, subject to subsection (2), the amount determined by the second formula in paragraph 414(3)(c) of the Income Tax Regulations for the taxation year in respect of the province;
- Y
- is
(a) subject to subsection (2), in respect of a taxation year that is after 2006 and before 2009 for which no election was made by the SIFT entity under subsection 34(4) of the Budget Implementation Act, 2008, the amount that would be determined under paragaph 414(3)(c) of the Income Tax Regulations in respect of the SIFT entity for the taxation year if the SIFT entity had made that election, and
(b) in any other case, the amount determined under paragraph 414(3)(c) of the Income Tax Regulations in respect of the SIFT entity for the taxation year;
- X
- is
(a) in respect of a taxation year that is after 2006 and before 2009 for which no election was made by the SIFT entity under subsection 34(4) of the Budget Implementation Act, 2008, 0.13, and
(b) in any other case, the amount determined under paragraph 414(3)(c) of the Income Tax Regulations in respect of the SIFT entity for the taxation year; and
- W
- is
(a) for a SIFT entity that is a SIFT trust, the SIFT trust’s taxable SIFT trust distributions, as defined in subsection 122(3) of the Income Tax Act, for the taxation year, and
(b) for a SIFT entity that is a SIFT partnership, the SIFT partnership’s taxable non-portfolio earnings, as defined in subsection 197(1) of the Income Tax Act, for the taxation year.
Marginal note:2007 and 2008 taxation years — permanent establishment in Quebec
(2) In respect of a taxation year that is after 2006 and before 2009 for which no election was made under subsection 34(4) of the Budget Implementation Act, 2008 by a SIFT entity that has a permanent establishment in the province of Quebec in that taxation year, in calculating the amount determined by the second formula in paragraph 414(3)(c) of the Income Tax Regulations in respect of that province, paragraph (a) of the definition general corporate income tax rate in subsection 414(1) is to be read as follows:
(a) for Quebec, the highest percentage rate of tax imposed under the laws of Quebec on the taxable income of a public corporation earned in the taxation year in Quebec;
- 2012, c. 31, s. 97
Marginal note:Consolidated Revenue Fund
12.35 Payments that the Minister may make under section 12.33 or 12.34 are to be made out of the Consolidated Revenue Fund at any time that the Minister may determine.
- 2012, c. 31, s. 97
Marginal note:Information
12.36 A SIFT entity that has not made an election under subsection 34(4) of the Budget Implementation Act, 2008 in respect of a taxation year that is after 2006 and before 2009 must furnish to the Minister of National Revenue any information that that Minister may require for the purpose of determining the amount payable to a province under this Part in respect of taxes payable by the SIFT entity under subsection 122(1) or 197(2) of the Income Tax Act for that taxation year.
- 2012, c. 31, s. 97
PART IV.2Transfer Payments — Tax on Payments Under Registered Education Savings Plans Under Part X.5 of the Income Tax Act
Marginal note:Transfer payments — Consolidated Revenue Fund
12.4 Subject to this Act, the Minister may pay to a province, out of the Consolidated Revenue Fund, at such time as the Minister may determine, an amount equal to 40% of the tax payable under Part X.5 of the Income Tax Act for a taxation year by a person who is resident in the province on the last day of that taxation year.
- 2010, c. 25, s. 145
Marginal note:Eligibility for payment
12.5 No payment may be made under this Part to a province if, in the opinion of the Minister, the province imposes or purports to impose a tax that is similar to the tax imposed under Part X.5 of the Income Tax Act.
- 2010, c. 25, s. 145
PART IV.3Transfer Payments — Tax on Excess Epsp Amounts Under Part Xi.4 of the Income Tax Act
Marginal note:Transfer payments — Consolidated Revenue Fund
12.6 Subject to this Act, the Minister may, at such time as he or she determines, pay to a province, out of the Consolidated Revenue Fund in respect of tax payable under section 207.8 of the Income Tax Act for a taxation year by a person who is resident in the province at the end of the taxation year, the amount determined by the formula:
A × B
where
- A
- is the percentage applicable to the person for the taxation year under the description of B in the formula in subsection 207.8(2) of the Income Tax Act; and
- B
- is the amount determined for the person for the taxation year under the description of C in the formula in subsection 207.8(2) of the Income Tax Act.
- 2012, c. 31, s. 98
Marginal note:Eligibility for payment
12.7 No payment may be made under this Part to a province if, in the opinion of the Minister, the province imposes or purports to impose a tax that is similar to the tax imposed under Part XI.4 of the Income Tax Act.
- 2012, c. 31, s. 98
PART IV.4Transfer Payments with Respect to Federal Taxes — Necessary Information
Marginal note:Information to be provided
12.8 The Minister of National Revenue shall provide to the Minister in a form and manner, and at a time, satisfactory to the Minister, any information necessary for the administration of Parts IV.01 to IV.3.
- 2012, c. 31, s. 98
PART V[Repealed, 2012, c. 19, s. 391]
13 [Repealed, 2012, c. 19, s. 391]
14 [Repealed, 2012, c. 19, s. 391]
15 [Repealed, 2012, c. 19, s. 391]
16 [Repealed, 2012, c. 19, s. 391]
16.1 [Repealed, 2012, c. 19, s. 391]
16.2 [Repealed, 2012, c. 19, s. 391]
16.3 [Repealed, 2012, c. 19, s. 391]
16.4 [Repealed, 2012, c. 19, s. 391]
17 [Repealed, 2012, c. 19, s. 391]
18 [Repealed, 2012, c. 19, s. 391]
19 [Repealed, 2012, c. 19, s. 391]
20 [Repealed, 2012, c. 19, s. 391]
21 [Repealed, 2012, c. 19, s. 391]
22 [Repealed, 2012, c. 19, s. 391]
23 [Repealed, 2012, c. 19, s. 391]
23.1 [Repealed, 2012, c. 19, s. 391]
23.2 [Repealed, 2012, c. 19, s. 391]
- Date modified: