Income Tax Regulations

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

(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 on the death of the identified individual 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 identified individual, whichever is longer, to the annuitant and, if the specified period is longer, to a specified person after that period;

• (d) the contract provides, in addition to the annuity payments to be made throughout the lifetime of the identified individual, for a payment to be made on the death of the identified individual;

• (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.