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

Act current to 2016-06-06 and last amended on 2015-12-31. Previous Versions

Marginal note:Corporation to file return
  •  (1) Every corporation that is liable to pay tax under this Part for a taxation year shall, on or before the day on or before which it is required to file its return of income under Part I for the year, file with the Minister a return for the year under this Part in prescribed form.

  • Marginal note:Corporation to make payment on account of tax

    (2) Where, in a particular month in a taxation year, a corporation issues a share or debt obligation, or grants a right, in respect of which it designates an amount under section 194, the corporation shall, on or before the last day of the month following the particular month, pay to the Receiver General on account of its tax payable under this Part for the year an amount equal to 50% of the total of all amounts so designated.

  • Marginal note:Interest

    (3) Where a corporation is liable to pay tax under this Part and has failed to pay all or any part or instalment thereof on or before the day on or before which the tax or instalment, as the case may be, was required to be paid, it shall pay to the Receiver General interest at the prescribed rate on the amount that it failed to pay computed from the day on or before which the amount was required to be paid to the day of payment.

  • Marginal note:Idem

    (4) For the purposes of computing interest payable by a corporation under subsection 195(3) for any month or months in the period commencing on the first day of a taxation year and ending two months after the last day of the year in which period the corporation has designated an amount under section 194 in respect of a share or debt obligation issued, or right granted, by it in a particular month in the year, the corporation shall be deemed to have been liable to pay, on or before the last day of the month immediately following the particular month, a part or an instalment of tax for the year equal to that proportion of the amount, if any, by which its tax payable under this Part for the year exceeds its Part VIII refund for the year that

    • (a) the total of all amounts so designated by it under section 194 in respect of shares or debt obligations issued, or rights granted, by it in the particular month

    is of

    • (b) the total of all amounts so designated by it under section 194 in respect of shares or debt obligations issued, or rights granted, by it in the year.

  • Marginal note:Evasion of tax

    (5) Where a corporation that is liable to pay tax under this Part in respect of a share or debt obligation issued or a right granted by it wilfully, in any manner whatever, evades or attempts to evade payment of the tax and a purchaser of the share, debt obligation or right or, where the purchaser is a partnership, a member of the partnership knew or ought to have known, at the time the share, debt obligation or right was acquired, that the corporation would wilfully evade or attempt to evade the tax, for the purposes of section 127.3, the share, debt obligation or right shall be deemed not to have been acquired.

  • Marginal note:Undue deferral

    (6) Where, in a transaction or as part of a series of transactions, a taxpayer acquires a share or debt obligation of a corporation or a right granted by a corporation and the corporation is controlled (within the meaning assigned by subsection 186(2)) by the taxpayer and it may reasonably be considered that one of the main purposes of the acquisition was to reduce for a period interest on the taxpayer’s liability for tax under this Part, the share, debt obligation or right shall, for the purposes of this Part (other than this subsection) and section 127.3, be deemed not to have been acquired by the taxpayer and not to have been issued or granted, as the case may be, by the corporation until the end of that period.

  • Marginal note:Avoidance of tax

    (7) Where, as part of a series of transactions or events one of the main purposes of which may reasonably be considered to be the avoidance of tax that might otherwise have been or become payable under Part II of the Income Tax Act, chapter 148 of the Revised Statutes of Canada, 1952, by any corporation, a particular corporation has issued a share or debt obligation or granted a right in a taxation year in respect of which it has designated an amount under subsection 194(4), the particular corporation shall, on or before the last day of the second month after the end of the year, pay a tax under this Part for the year equal to 125% of the amount of tax under Part II of the Income Tax Act, chapter 148 of the Revised Statutes of Canada, 1952, that is or may be avoided by reason of the series of transactions or events.

  • Marginal note:Tax on excess

    (7.1) Where a corporation has in a taxation year made an election under subsection 127.3(9) in respect of any share or debt obligation that was part of a distribution of shares or debt obligations referred to in that subsection and, at the end of that year or any subsequent taxation year,

    • (a) the total of the amounts designated under subsection 194(4) in respect of those shares or debt obligations as evidenced by the prescribed information returns required by regulation to be filed with the Minister by a taxpayer other than the corporation

    exceeds

    • (b) the total of the amounts designated under subsection 194(4) in respect of those shares or debt obligations acquired by the taxpayer and in respect of which another taxpayer was required by regulation to provide the taxpayer with a prescribed information return relating to the designation under that subsection,

    the taxpayer is liable to pay a tax under this Part, for the taxation year at the end of which there is such an excess, equal to 50% of the excess, which tax is to be paid to the Receiver General within 60 days after the end of the taxation year, and the excess shall be included in determining the total under paragraph 195(7.1)(b) for any taxation year of the taxpayer subsequent to that year.

  • Marginal note:Provisions applicable to Part

    (8) Sections 151, 152, 158 and 159, subsection 161(11), sections 162 to 167 (except subsections 164(1.1) to 164(1.3)) and Division J of Part I are applicable to this Part with such modifications as the circumstances require and, for greater certainty, the Minister may assess, before the end of a taxation year, an amount payable under this Part for the year.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 1970-71-72, c. 63, s. 1“195”;
  • 1977-78, c. 1, s. 88;
  • 1984, c. 1, s. 95, c. 45, s. 83;
  • 1985, c. 45, s. 106;
  • 1986, c. 6, s. 104, c. 24, s. 1.

PART IXTax on Deduction Under Section 66.5

Marginal note:Tax in respect of cumulative offset account
  •  (1) Every corporation shall pay a tax under this Part for each taxation year equal to 30% of the amount deducted under subsection 66.5(1) in computing its income for the year.

  • Marginal note:Return

    (2) Every corporation that is liable to pay tax under this Part for a taxation year shall file with the Minister, not later than the day on or before which it is required under section 150 to file a return of its income for the year under Part I, a return for the year under this Part in prescribed form containing an estimate of the amount of tax payable by it under this Part for the year.

  • Marginal note:Instalments

    (3) Where a corporation is liable to pay tax for a taxation year under this Part, the corporation shall pay in respect of the year, to the Receiver General

    • (a) on or before the last day of each month in the year, an amount equal to 1/12 of the amount of tax payable by it under this Part for the year; and

    • (b) the remainder, if any, of the tax payable by it under this Part for the year, on or before its balance-due day for the year.

  • Marginal note:Provisions applicable to Part

    (4) Sections 152, 158 and 159, subsections 161(1) and 161(2), sections 162 to 167 and Division J of Part I are applicable to this Part, with such modifications as the circumstances require.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. R.S., 1985, c. 1 (5th Supp.), s. 196;
  • 2003, c. 15, s. 123.

PART IX.1Tax on Sift Partnerships

Marginal note:Definitions
  •  (1) The following definitions apply in this Part and in section 96.

    non-portfolio earnings

    gains hors portefeuille

    non-portfolio earnings, of a SIFT partnership for a taxation year, means the total of

    • (a) the amount, if any, by which

      • (i) the total of all amounts each of which is the SIFT partnership’s income for the taxation year from a business carried on by it in Canada or from a non-portfolio property, other than income that is a taxable dividend received by the SIFT partnership,

      exceeds

      • (ii) the total of all amounts each of which is the SIFT partnership’s loss for the taxation year from a business carried on by it in Canada or from a non-portfolio property, and

    • (b) the amount, if any, by which all taxable capital gains of the SIFT partnership from dispositions of non-portfolio properties during the taxation year exceeds the total of the allowable capital losses of the SIFT partnership for the taxation year from dispositions of non-portfolio properties during the taxation year. (gains hors portefeuille)

    SIFT partnership

    société de personnes intermédiaire de placement déterminée

    SIFT partnership, being a specified investment flow-through partnership, for any taxation year, means a partnership other than an excluded subsidiary entity (as defined in subsection 122.1(1)) for the taxation year that meets the following conditions at any time during the taxation year:

    • (a) the partnership is a Canadian resident partnership;

    • (b) investments (as defined in subsection 122.1(1)) in the partnership are listed or traded on a stock exchange or other public market; and

    • (c) the partnership holds one or more non-portfolio properties. (société de personnes intermédiaire de placement déterminée)

    taxable non-portfolio earnings

    gains hors portefeuille imposables

    taxable non-portfolio earnings of a SIFT partnership, for a taxation year, means the lesser of

    • (a) the amount that would, if the SIFT partnership were a taxpayer for the purposes of Part I and if subsection 96(1) were read without reference to its paragraph (d), be its income for the taxation year as determined under section 3; and

    • (b) its non-portfolio earnings for the taxation year. (gains hors portefeuille imposables)

  • Marginal note:Tax on partnership income

    (2) Every partnership that is a SIFT partnership for a taxation year is liable to a tax under this Part equal to the amount determined by the formula

    A × (B + C)

    where

    A 
    is the taxable non-portfolio earnings of the SIFT partnership for the taxation year;
    B 
    is the net corporate income tax rate in respect of the SIFT partnership for the taxation year; and
    C 
    is the provincial SIFT tax rate of the SIFT partnership for the taxation year.
  • Marginal note:Ordering

    (3) This Part and section 122.1 are to be applied as if this Act were read without reference to subsection 96(1.11).

  • Marginal note:Partnership to file return

    (4) Every member of a partnership that is liable to pay tax under this Part for a taxation year shall — on or before the day on or before which the partnership return is required to be filed for the year under section 229 of the Income Tax Regulations — file with the Minister a return for the taxation year under this Part in prescribed form containing an estimate of the tax payable by the partnership under this Part for the taxation year.

  • Marginal note:Authority to file return

    (5) For the purposes of subsection (4), if, in respect of a taxation year of a partnership, a particular member of the partnership has authority to act for the partnership,

    • (a) if the particular member has filed a return as required by this Part for a taxation year, each other person who was a member of the partnership during the taxation year is deemed to have filed the return; and

    • (b) a return that has been filed by any other member of the partnership for the taxation year is not valid and is deemed not to have been filed by any member of the partnership.

  • Marginal note:Provisions applicable to Part

    (6) Subsection 150(2), section 152, subsections 157(1), (2.1) and (4), sections 158, 159 and 161 to 167 and Division J of Part I apply to this Part, with any modifications that the circumstances require, and for greater certainty,

    • (a) a notice of assessment referred to in subsection 152(2) in respect of tax payable under this Part is valid notwithstanding that a partnership is not a person; and

    • (b) notwithstanding subsection 152(4), the Minister may at any time make an assessment or reassessment of tax payable under this Part or Part I to give effect to a determination made by the Minister under subsection 152(1.4), including the assessment or reassessment of Part I tax payable in respect of the disposition of an interest in a SIFT partnership by a member of the partnership.

  • Marginal note:Payment

    (7) Every SIFT partnership shall pay to the Receiver General, on or before its SIFT partnership balance-due day for each taxation year, its tax payable under this Part for the taxation year.

  • Application of definition SIFT partnership

    (8) The definition SIFT partnership applies to a partnership for a taxation year of the partnership that ends after 2006, except that if the partnership would have been a SIFT partnership on October 31, 2006 had that definition been in force and applied to the partnership as of that date, that definition does not apply to the partnership for a taxation year of the partnership that ends before the earlier of

    • (a) 2011, and

    • (b) the first day after December 15, 2006 on which the partnership exceeds normal growth as determined by reference to the normal growth guidelines issued by the Department of Finance on December 15, 2006, as amended from time to time, unless that excess arose as a result of a prescribed transaction.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending Acts. 2007, c. 29, s. 24;
  • 2008, c. 28, s. 30;
  • 2009, c. 2, s. 65;
  • 2013, c. 40, s. 72.
 
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