Technical Tax Amendments Act, 2012 (S.C. 2013, c. 34)
Full Document:
Assented to 2013-06-26
328. In applying the description of B in paragraph 188(1)(a) of the Act in respect of gifts made to a charity after December 20, 2002, to the extent that those gifts are relevant in respect of notices of intention to revoke the registration of the charity and certificates under subsection 5(1) of the Charities Registration (Security Information) Act that are issued by the Minister of National Revenue before June 13, 2005, that description is to be read as follows:
- B
- is the total of all amounts each of which is the eligible amount of a gift for which it issued a receipt described in subsection 110.1(2) or 118.1(2) in the period (in this section referred to as the “winding-up period”) that begins on the valuation day and ends immediately before the payment day, or an amount received by it in the winding-up period from a registered charity,
329. (1) Paragraph 190.1(3)(a) of the Act is replaced by the following:
(a) the corporation’s tax payable under Part I for the year; and
(2) The definition “unused Part I tax credit” in subsection 190.1(5) of the Act is replaced by the following:
“unused Part I tax credit”
« crédit d’impôt de la partie I inutilisé »
“unused Part I tax credit”, of a corporation for a taxation year, means the amount, if any, by which
(a) the corporation’s tax payable under Part I for the year
exceeds
(b) the amount that would, but for subsection (3), be its tax payable under this Part for the year;
(3) Subsections (1) and (2) apply to taxation years that begin after 2007.
330. (1) Subparagraph 190.13(a)(v) of the Act is replaced by the following:
(v) the amount of any deficit deducted in computing its shareholders’ equity (including, for this purpose, the amount of any provision for the redemption of preferred shares);
(2) Subparagraph 190.13(b)(iv) of the Act is replaced by the following:
(iv) the amount of any deficit deducted in computing its shareholders’ equity (including, for this purpose, the amount of any provision for the redemption of preferred shares);
(3) Subsections (1) and (2) apply to taxation years that begin after 1995.
331. (1) Section 190.16 of the Act and the heading before it are repealed.
(2) Subsection (1) applies to taxation years that begin after October 31, 2011.
332. (1) Section 191 of the Act is amended by adding the following after subsection (5):
Marginal note:Excluded dividend — partner
(6) If at any time a corporation pays a dividend to a partnership, the corporation is, for the purposes of this subsection and paragraph (a) of the definition “excluded dividend” in subsection (1), deemed to have paid at that time to each member of the partnership a dividend equal to the amount determined by the formula
A × B
where
- A
- is the amount of the dividend paid to the partnership; and
- B
- is the member’s specified proportion for the last fiscal period of the partnership that ended before that time (or, if the partnership’s first fiscal period includes that time, for that first fiscal period).
(2) Subsection (1) applies to dividends paid after December 20, 2002.
333. (1) Subparagraph 191.1(1)(a)(i) of the Act is replaced by the following:
(i) the amount determined by multiplying the amount by which the total of all taxable dividends (other than excluded dividends) paid by the corporation in the year and after 1987 on short-term preferred shares exceeds the corporation’s dividend allowance for the year, by
(A) 50% for dividends paid in a taxation year that ends before 2010,
(B) 45% for dividends paid in a taxation year that ends after 2009 and before 2012,
(C) 40% for dividends paid in a taxation year that ends after 2011,
(2) Subsection (1) applies to the 2003 and subsequent taxation years.
334. Section 200 of the French version of the Act is replaced by the following:
Marginal note:Distribution assimilée à une disposition
200. Pour l’application de la présente partie, la distribution par une fiducie d’un placement non admissible à un bénéficiaire de la fiducie est réputée être une disposition du placement, et le produit de disposition du placement est réputé être sa juste valeur marchande au moment de la distribution.
335. (1) The definition “reserve” in subsection 204.8(1) of the Act is replaced by the following:
“reserve”
« réserve »
“reserve” means
(a) property described in any of paragraphs (a), (b), (c), (f) and (g) of the definition “qualified investment” in section 204, and
(b) deposits with a credit union that is a “member institution” in relation to a deposit insurance corporation (within the meaning assigned by subsection 137.1(5));
(2) Subsection 204.8(1) of the Act is amended by adding the following in alphabetical order:
“terminating corporation”
« société sortante »
“terminating corporation” in respect of a particular corporation means a predecessor corporation in circumstances where
(a) subsection 204.85(3) applies to a merger of the particular corporation and the predecessor corporation,
(b) Class A shares of the particular corporation have been issued to the predecessor corporation in exchange for property of the predecessor corporation, and
(c) within a reasonable period of time after the exchange, Class A shareholders of the predecessor corporation receive all of the Class A shares of the particular corporation issued to the predecessor corporation in the course of a wind-up of the predecessor corporation.
(3) Paragraph 204.8(2)(b) of the Act is replaced by the following:
(b) at the time it begins to wind-up, and for the purpose of this paragraph a corporation is not to be considered to have begun to wind up solely because it discontinues its venture capital business under prescribed wind-up rules;
(4) Subsection (1) applies to taxation years that end after 2006.
(5) Subsection (2) is deemed to have come into force on January 1, 2005.
(6) Subsection (3) is deemed to have come into force on October 24, 2012.
336. (1) The portion of clause 204.81(1)(c)(ii)(A) of the Act before subclause (I) is replaced by the following:
(A) Class A shares that are issuable only to individuals (other than trusts), terminating corporations in respect of the corporation and trusts governed by registered retirement savings plans or by TFSAs and that entitle their holders
(2) Subparagraph 204.81(1)(c)(iv) of the Act is replaced by the following:
(iv) the corporation shall not reduce its paid-up capital in respect of a class of shares (other than Class B shares) otherwise than by way of
(A) a redemption of shares of the corporation, or
(B) a reduction in its paid-up capital attributable to a class of shares for which no shares have been issued in the eight-year period ending at the time of the reduction,
(3) Clause 204.81(1)(c)(v)(E) of the Act is replaced by the following:
(E) the redemption occurs
(I) more than eight years after the day on which the share was issued, or
(II) if the day that is eight years after that issuance is in February or March of a calendar year, in February or on March 1st of that calendar year but not more than 31 days before that day, or
(4) Subparagraph 204.81(1)(c)(vii) of the Act is amended by adding the following after clause (A):
(B) the transfer occurs more than eight years after the day on which the share was issued,
(5) Section 204.81 of the Act is amended by adding the following after subsection (1):
Marginal note:Corporations incorporated before March 6, 1996
(1.1) In applying clause (1)(c)(v)(E) in relation to any time before 2004 in respect of a corporation incorporated before March 6, 1996, the references in that clause to “eight” are replaced with references to “five” if, at that time, the relevant statements in the corporation’s articles refer to “five”.
Marginal note:Deemed provisions in articles
(1.2) In applying subsection (1) in relation to any time before 2004, to a corporation incorporated before February 7, 2000, if the articles of the corporation comply with subclause (1)(c)(v)(E)(I) (as modified, where relevant, by subsection (1.1)), those articles are deemed to provide the statement required by subclause (1)(c)(v)(E)(II).
(6) Section 204.81 of the Act is amended by adding the following after subsection (8.2):
Marginal note:Discontinuance of provincial program
(8.3) If a corporation is a prescribed labour-sponsored venture capital corporation because of the laws of a province, which province has discontinued its labour-sponsored venture capital corporation credit program, notifies the Minister in writing of its intent to revoke its registration under this Part, and meets the requirements under prescribed wind-up rules, then the following rules apply:
(a) the corporation shall not, on or after the day the notice is provided to the Minister (referred to in this subsection and subsection (8.4) as the “notification date”), issue any tax credit certificates, other than duplicate certificates to replace certificates issued before that day;
(b) section 204.841 does not apply on the discontinuance of its venture capital business;
(c) subsections 204.82(1) to (4) do not apply to taxation years of the corporation that begin on or after the notification date; and
(d) subsection 204.83(1) does not apply in respect of a period, referred to in that subsection as the “second period”, that ends after the notification date.
Marginal note:Discontinuance of provincial program
(8.4) Subsection (8.3) applies to a corporation only if,
(a) on the notification date, the percentage determined in respect of the corporation by the following formula is less than 20 per cent:
A/(B – C) × 100
where
- A
- is the amount of equity capital received by the corporation on the issue of Class A shares that were issued in the 24 months immediately preceding the notification date and are still outstanding on that date,
- B
- is the total amount of equity capital received by the corporation on the issue of Class A shares that are still outstanding on the notification date, and
- C
- is the amount of equity capital received by the corporation on the issue of Class A shares that, as of the notification date, have been outstanding for at least eight years.
(b) the corporation has revoked its registration before the third anniversary of the notification date.
(7) Subsection (1) is deemed to have come into force on January 1, 2005.
(8) Subsections (2) and (6) are deemed to have come into force on October 24, 2012.
(9) Subsection (3) applies after February 6, 2000 to corporations incorporated at any time.
(10) Subsection (4) applies as of October 24, 2012 to corporations incorporated after March 5, 1996.
(11) Subsection (5) is deemed to have come into force on February 7, 2000.
- Date modified: