Budget Implementation Act, 2017, No. 2 (S.C. 2017, c. 33)

Marginal note:Employee options

(d) an amount equal to 1/2 of the amount of the benefit deemed by subsection 7(1) to have been received by the taxpayer in the year in respect of a security that a particular qualifying person has agreed after February 15, 1984 to sell or issue under an agreement, in respect of the transfer or other disposition of rights under the agreement or as a result of the death of the taxpayer because the taxpayer immediately before death owned a right to acquire the security under the agreement, if

• (i) the security was acquired under the agreement

  • (A) by the taxpayer or a person not dealing at arm’s length with the taxpayer in circumstances described in paragraph 7(1)(c), or

  • (B) in the case of a benefit deemed by paragraph 7(1)(e) to have been received by the taxpayer, within the first taxation year of the graduated rate estate of the taxpayer, by

    • (I) the graduated rate estate of the taxpayer,

    • (II) a person who is a beneficiary (as defined in subsection 108(1)) under the graduated rate estate of the taxpayer, or

    • (III) a person in whom the rights of the taxpayer under the agreement have vested as a result of the death,

• (i.1) the security

  • (A) is a prescribed share at the time of its sale or issue, as the case may be,

  • (B) would have been a prescribed share if it were issued or sold to the taxpayer at the time the taxpayer disposed of rights under the agreement,

  • (B.1) in the case of a benefit deemed by paragraph 7(1)(e) to have been received by the taxpayer, would have been a prescribed share if it were issued or sold to the taxpayer immediately before the death of the taxpayer,

  • (C) would have been a unit of a mutual fund trust at the time of its sale or issue if those units issued by the trust that were not identical to the security had not been issued,

  • (D) would have been a unit of a mutual fund trust if

    • (I) it were issued or sold to the taxpayer at the time the taxpayer disposed of rights under the agreement, and

    • (II) those units issued by the trust that were not identical to the security had not been issued, or

  • (E) in the case of a benefit deemed by paragraph 7(1)(e) to have been received by the taxpayer, would have been a unit of a mutual fund trust if

    • (I) it were issued or sold to the taxpayer immediately before the death of the taxpayer, and

    • (II) those units issued by the trust that were not identical to the security had not been issued,

(c) the particular qualifying person provides the taxpayer or, if the taxpayer is deceased, the graduated rate estate of the taxpayer, with evidence in writing of the election; and

(d) the taxpayer or, if the taxpayer is deceased, the graduated rate estate of the taxpayer, files the evidence with the Minister with the taxpayer’s return of income for the year in which a deduction under paragraph (1)(d) is claimed.

Marginal note:Ecological gifts

(d) the total of all amounts each of which is the eligible amount of a gift of land (including a covenant or an easement to which land is subject or, in the case of land in the Province of Quebec, a personal servitude (the rights to which the land is subject and which has a term of not less than 100 years) or a real servitude) if

(B) a municipality in Canada that is approved by that Minister or the designated person in respect of the gift,

(C) a municipal or public body performing a function of government in Canada that is approved by that Minister or the designated person in respect of the gift, or

(D) a registered charity (other than a private foundation) one of the main purposes of which is, in the opinion of that Minister, the conservation and protection of Canada’s environmental heritage, and that is approved by that Minister or the designated person in respect of the gift.

(b) where the gift is a covenant or an easement to which land is subject or, in the case of land in the Province of Quebec, a real or personal servitude, the greater of

Marginal note:Interest in a partnership — cost reduction

(11) In computing the cost to a taxpayer, at any time, of an interest in a partnership that is property (other than capital property) of the taxpayer, there is to be deducted an amount equal to the total of all amounts each of which is the taxpayer’s share of any loss of the partnership from the disposition by the partnership, or another partnership of which the partnership is directly or indirectly a member, of a share of the capital stock of a corporation (referred to in this subsection and subsection (12) as the “partnership loss”) in a fiscal period of the partnership that includes that time or a prior fiscal period, computed without reference to subsections (3.1), (4) and (5.2), to the extent that the taxpayer’s share of the partnership loss has not previously reduced the taxpayer’s cost of the interest in the partnership because of the application of this subsection.

Marginal note:Application

(12) For the purposes of subsection (11), if a taxpayer disposes of an interest in a partnership at any particular time, the taxpayer’s share of a partnership loss is to be computed as if

• (a) the fiscal period of each partnership of which the taxpayer is directly or indirectly a member had ended immediately before the time that is immediately before the particular time;

• (b) any share of the capital stock of a corporation that was property of a partnership referred to in paragraph (a) at the particular time had been disposed of by the relevant partnership immediately before the end of that fiscal period for proceeds equal to its fair market value at the particular time; and

• (c) each member of a partnership referred to in paragraph (a) were allocated a share of any loss (computed without reference to subsections (3.1), (4) and (5.2)) in respect of dispositions described in paragraph (b) determined by reference to the member’s specified proportion for the fiscal period referred to in paragraph (a).

Marginal note:Application

(13) For the purposes of subsection (11), if a taxpayer (referred to as the “transferee” in this subsection) acquires an interest in a partnership at any time from another taxpayer (referred to as the “transferor” in this subsection), in computing the cost of the partnership interest to the transferee there is to be added an amount equal to the total of all amounts each of which is an amount deducted from the transferor’s cost of the partnership interest because of subsection (11), other than an amount to which subsection (3.1) would apply.