Income Tax Act

Marginal note:Residing in prescribed zone

• 110.7 (1) Where, throughout a period (in this section referred to as the “qualifying period”) of not less than 6 consecutive months beginning or ending in a taxation year, a taxpayer who is an individual has resided in one or more particular areas each of which is a prescribed northern zone or prescribed intermediate zone for the year and files for the year a claim in prescribed form, there may be deducted in computing the taxpayer’s taxable income for the year

  • (a) the total of all amounts each of which is the product obtained by multiplying the specified percentage for a particular area for the year in which the taxpayer so resided by an amount received, or the value of a benefit received or enjoyed, in the year by the taxpayer in respect of the taxpayer’s employment in the particular area by a person with whom the taxpayer was dealing at arm’s length in respect of travel expenses incurred by the taxpayer or another individual who was a member of the taxpayer’s household during the part of the year in which the taxpayer resided in the particular area, to the extent that

    • (i) the amount received or the value of the benefit, as the case may be,

      • (A) does not exceed a prescribed amount in respect of the taxpayer for the period in the year in which the taxpayer resided in the particular area,

      • (B) is included and is not otherwise deducted in computing the taxpayer’s income for the year or any other taxation year, and

      • (C) is not included in determining an amount deducted under subsection 118.2(1) for the year or any other taxation year,

    • (ii) the travel expenses were incurred in respect of trips made in the year by the taxpayer or another individual who was a member of the taxpayer’s household during the part of the year in which the taxpayer resided in the particular area, and

    • (iii) neither the taxpayer nor a member of the taxpayer’s household is at any time entitled to a reimbursement or any form of assistance (other than a reimbursement or assistance included in computing the income of the taxpayer or the member) in respect of travel expenses to which subparagraph 110.7(1)(a)(ii) applies; and

  • (b) the lesser of

    • (i) 20% of the taxpayer’s income for the year, and

    • (ii) the total of all amounts each of which is the product obtained by multiplying the specified percentage for a particular area for the year in which the taxpayer so resided by the total of

      • (A) $11.00 multiplied by the number of days in the year included in the qualifying period in which the taxpayer resided in the particular area, and

      • (B) $11.00 multiplied by the number of days in the year included in that portion of the qualifying period throughout which the taxpayer maintained and resided in a self-contained domestic establishment in the particular area (except any day included in computing a deduction claimed under this paragraph by another person who resided on that day in the establishment).

• Marginal note:Specified percentage

  (2) For the purpose of subsection 110.7(1), the specified percentage for a particular area for a taxation year is

  • (a) where the area is a prescribed northern zone for the year, 100%; and

  • (b) where the area is a prescribed intermediate zone for the year, 50%.

• Marginal note:Restriction

  (3) The total determined under paragraph 110.7(1)(a) for a taxpayer in respect of travel expenses incurred in a taxation year in respect of an individual shall not be in respect of more than 2 trips made by the individual in the year, other than trips to obtain medical services that are not available in the locality in which the taxpayer resided.

• Marginal note:Board and lodging allowances, etc.

  (4) The amount determined under subparagraph (1)(b)(ii) for a particular area for a taxpayer for a taxation year shall not exceed the amount by which the amount otherwise determined under that subparagraph for the particular area for the year exceeds the value of, or an allowance in respect of expenses incurred by the taxpayer for, the taxpayer’s board and lodging in the particular area (other than at a work site described in paragraph 67.1(2)(e)) that

  • (a) would, but for subparagraph 6(6)(a)(i), be included in computing the taxpayer’s income for the year; and

  • (b) can reasonably be considered to be attributable to that portion of the qualifying period that is in the year and during which the taxpayer maintained a self-contained domestic establishment as the taxpayer’s principal place of residence in an area other than a prescribed northern zone or a prescribed intermediate zone for the year.

• Marginal note:Idem

  (5) Where on any day an individual resides in more than one particular area referred to in subsection 110.7(1), for the purpose of that subsection, the individual shall be deemed to reside in only one such area on that day.