Income Tax Act

Marginal note:Definitions

• 181 (1) For the purposes of this Part,

  financial institution

  financial institution, in respect of a taxation year, means a corporation that at any time in the year is

  • (a) a bank or credit union,

  • (b) an insurance corporation that carries on business in Canada,

  • (c) authorized under the laws of Canada or a province to carry on the business of offering its services as a trustee to the public,

  • (d) authorized under the laws of Canada or a province to accept deposits from the public and carries on the business of lending money on the security of real property or immovables or investing in indebtedness on the security of mortgages on real property or of hypothecs on immovables,

  • (e) a registered securities dealer,

  • (f) a mortgage investment corporation, or

  • (g) a corporation

    • (i) listed in the schedule, or

    • (ii) all or substantially all of the assets of which are shares or indebtedness of financial institutions to which the corporation is related; (institution financière)

  long-term debt

  long-term debt means

  • (a) in the case of a bank, its subordinated indebtedness (within the meaning assigned by section 2 of the Bank Act) evidenced by obligations issued for a term of not less than 5 years,

  • (b) in the case of an insurance corporation, its subordinated indebtedness (within the meaning assigned by section 2 of the Insurance Companies Act) evidenced by obligations issued for a term of not less than 5 years, and

  • (c) in the case of any other corporation, its subordinated indebtedness (within the meaning that would be assigned by section 2 of the Bank Act if the definition of that expression in that section were applied with such modifications as the circumstances require) evidenced by obligations issued for a term of not less than 5 years,

  but does not include, where the corporation is a prescribed federal Crown corporation for the purpose of section 27, any indebtedness evidenced by obligations issued to and held by Her Majesty in right of Canada; (passif à long terme)

  reserves

  reserves, in respect of a corporation for a taxation year, means the amount at the end of the year of all of the corporation’s reserves, provisions and allowances (other than allowances in respect of depreciation or depletion) and, for greater certainty, includes any provision in respect of deferred taxes. (réserves)

• Marginal note:Prescribed expressions

  (2) For the purposes of this Part, the expressions attributed surplus, Canadian assets, Canadian premiums, Canadian reserve liabilities, permanent establishment, total assets, total premiums and total reserve liabilities have such meanings as may be prescribed.

• Marginal note:Determining values and amounts

  (3) For the purposes of determining the carrying value of a corporation’s assets or any other amount under this Part in respect of a corporation’s capital, investment allowance, taxable capital or taxable capital employed in Canada for a taxation year or in respect of a partnership in which a corporation has an interest,

  • (a) the equity and consolidation methods of accounting shall not be used; and

  • (b) subject to paragraph 181(3)(a) and except as otherwise provided in this Part, the amounts reflected in the balance sheet

    • (i) presented to the shareholders of the corporation (in the case of a corporation that is neither an insurance corporation to which subparagraph 181(3)(b)(ii) applies nor a bank) or the members of the partnership, as the case may be, or, where such a balance sheet was not prepared in accordance with generally accepted accounting principles or no such balance sheet was prepared, the amounts that would be reflected if such a balance sheet had been prepared in accordance with generally accepted accounting principles, or

    • (ii) accepted by the Superintendent of Financial Institutions, in the case of a bank or an insurance corporation that is required by law to report to the Superintendent, or the superintendent of insurance or other similar officer or authority of the province under whose laws the corporation is incorporated, in the case of an insurance corporation that is required by law to report to that officer or authority,

    shall be used.

• Marginal note:Limitations respecting inclusions and deductions

  (4) Unless a contrary intention is evident, no provision of this Part shall be read or construed to require the inclusion or to permit the deduction, in computing the amount of a corporation’s capital, investment allowance, taxable capital or taxable capital employed in Canada for a taxation year, of any amount to the extent that that amount has been included or deducted, as the case may be, in computing the first-mentioned amount under, in accordance with or by reason of any other provision of this Part.