Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.))

Act current to 2015-04-22 and last amended on 2015-01-02. Previous Versions

Marginal note:Tax payable on excess TFSA amount

 If, at any time in a calendar month, an individual has an excess TFSA amount, the individual shall, in respect of that month, pay a tax under this Part equal to 1% of the highest such amount in that month.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 2008, c. 28, s. 31.
Marginal note:Tax payable on non-resident contributions

 If, at a particular time, a non-resident individual makes a contribution under a TFSA (other than a contribution that is a qualifying transfer or an exempt contribution), the individual shall pay a tax under this Part equal to 1% of the amount of the contribution in respect of each month that ends after the particular time and before the earlier of

  • (a) the first time after the particular time at which the amount of the contribution is equalled or exceeded by the total of all amounts each of which is a distribution

    • (i) that is made after the particular time under a TFSA of which the individual is the holder, and

    • (ii) that the individual designates in prescribed manner to be a distribution in connection with the contribution and not in connection with any other contribution, and

  • (b) the time at which the individual becomes resident in Canada.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 2008, c. 28, s. 31;
  • 2009, c. 2, s. 69.
Marginal note:Tax payable on prohibited or non-qualified investment
  •  (1) The controlling individual of a registered plan that governs a trust shall pay a tax under this Part for a calendar year if, at any time in the year, the trust acquires property that is a prohibited investment, or a non-qualified investment, for the trust.

  • Marginal note:Amount of tax payable

    (2) The amount of tax payable in respect of each property described in subsection (1) is 50% of the fair market value of the property at the time referred to in that subsection.

  • Marginal note:Both prohibited and non-qualified investment

    (3) For the purposes of this section and subsections 146(10.1), 146.2(6), 146.3(9) and 207.01(6), if a trust governed by a registered plan holds property at any time that is, for the trust, both a prohibited investment and a non-qualified investment, the property is deemed at that time not to be a non-qualified investment, but remains a prohibited investment, for the trust.

  • Marginal note:Refund of tax on disposition of investment

    (4) If in a calendar year a trust governed by a registered plan disposes of a property in respect of which a tax is imposed under subsection (1) on the controlling individual of the registered plan, the controlling individual is entitled to a refund for the year of an amount equal to

    • (a) except where paragraph (b) applies, the amount of the tax so imposed; or

    • (b) nil,

      • (i) if it is reasonable to consider that the controlling individual knew, or ought to have known, at the time the property was acquired by the trust, that it was, or would become, a property described in subsection (1), or

      • (ii) if the property is not disposed of by the trust before the end of the calendar year following the calendar year in which the tax arose, or any later time that the Minister considers reasonable in the circumstances.

  • (5) [Repealed, 2013, c. 40, s. 75]

  • (6) and (7) [Repealed, 2010, c. 25, s. 58]

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 2008, c. 28, s. 31;
  • 2009, c. 2, s. 70;
  • 2010, c. 25, s. 58;
  • 2011, c. 24, s. 65;
  • 2013, c. 40, s. 75.