Income Tax Act

Marginal note:Minimum tax carry-over

• 120.2 (1) There may be deducted from the amount that, but for this section, section 120 and subsection 120.4(2), would be an individual’s tax payable under this Part for a particular taxation year such amount as the individual claims not exceeding the lesser of

  • (a) the portion of the total of the individual’s additional taxes determined under subsection 120.2(3) for the 7 taxation years immediately preceding the particular year that was not deducted in computing the individual’s tax payable under this Part for a taxation year preceding the particular year, and

  • (b) the amount, if any, by which

    • (i) the amount that, but for this section, section 120 and subsection 120.4(2), would be the individual’s tax payable under this Part for the particular year if the individual were not entitled to any deduction under any of sections 126, 127 and 127.4

    exceeds

    • (ii) the individual’s minimum amount for the particular year determined under section 127.51.

• Marginal note:Additional tax determined

  (3) For the purposes of subsection 120.2(1), additional tax of an individual for a taxation year is the amount, if any, by which

  • (a) the individual’s minimum amount for the year determined under section 127.51

  exceeds the total of

  • (b) the amount that, but for section 120 and subsection 120.4(2), would be the individual’s tax payable under this Part for the year if the individual were not entitled to any deduction under any of sections 126, 127 and 127.4, and

  • (c) that proportion of the amount, if any, by which

    • (i) the individual’s special foreign tax credit for the year determined under section 127.54

    exceeds

    • (ii) the total of all amounts deductible under section 126 from the individual’s tax for the year

    that

    • (iii) the amount of the individual’s foreign taxes for the year within the meaning assigned by subsection 127.54(1)

    is of

    • (iv) the amount that would be the individual’s foreign taxes for the year within the meaning assigned by subsection 127.54(1) if the definition foreign taxes in that subsection were read without reference to “2/3 of”.

• Marginal note:Where subsection (1) does not apply

  (4) Subsection (1) does not apply in respect of an individual’s return of income filed under subsection 70(2), paragraph 104(23)(d) or 128(2)(f) or subsection 150(4).