Income Tax Regulations (C.R.C., c. 945)

Regulations are current to 2015-05-11 and last amended on 2015-03-13. Previous Versions

Prepaid Insurance Benefit

Amount of Benefit

  •  (1) Subject to section 2704, for the purpose of paragraph 2701(1)(b), a taxpayer’s prepaid insurance benefit under a group term life insurance policy for a calendar year is

    • (a) where the taxpayer is alive at the end of the year, the total of all amounts each of which is

      • (i) a lump-sum premium (other than the taxpayer portion) paid in the year and after February 1994 in respect of insurance under the policy on the life of the taxpayer, other than a paid-up premium paid before 1997, or

      • (ii) 1/3 of a paid-up premium (other than the taxpayer portion) in respect of insurance under the policy on the life of the taxpayer that was paid

        • (A) after February 1994 and before 1997, and

        • (B) in the year or one of the two preceding years; and

    • (b) where the taxpayer died after June 1994 and in the year, the amount, if any, by which

      • (i) the total of all amounts each of which is a lump-sum premium (other than the taxpayer portion) paid under the policy after February 1994 in respect of insurance on the life of the taxpayer

      exceeds

      • (ii) the portion of that total that was included in computing the taxpayer’s prepaid insurance benefit under the policy for preceding years.

Taxpayer Portion of Premiums

  • (2) For the purpose of subsection (1), the taxpayer portion of a premium is the portion, if any, of the premium that the taxpayer paid, either directly or by way of reimbursement.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending regulations. SOR/97-494, s. 1.

Employee-Paid Insurance

  •  (1) For the purpose of subsection 2701(1), where the full cost of insurance under a group term life insurance policy in a calendar year is borne by the individuals whose lives are insured under the policy, each individual’s term insurance benefit and prepaid insurance benefit under the policy for the year is deemed to be nil.

  • (2) Where the premiums for part of the life insurance (in this subsection referred to as the “additional insurance”) under a group term life insurance policy are determined separately from the premiums for the rest of the life insurance under the policy, and it is reasonable to consider that the individuals on whose lives the additional insurance is provided bear the full cost of the additional insurance, the additional insurance, the premiums, policy dividends and experience rating refunds in respect of that insurance, and the amounts paid in respect of that insurance by the individuals whose lives are insured, shall not be taken into account for the purposes of this Part.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending regulations. SOR/97-494, s. 1.

Prescribed Premium and Insurance

 For the purpose of subsection 6(4) of the Act, as it applies to insurance provided in respect of periods that are in 1994 and before July 1994,

  • (a) a lump-sum premium paid under a group term life insurance policy after February 1994 in respect of an individual who is alive at the end of June 1994 is a prescribed premium; and

  • (b) insurance in respect of which a premium referred to in paragraph (a) is paid is prescribed insurance.

  • NOTE: Application provisions are not included in the consolidated text;
  • see relevant amending regulations. SOR/97-494, s. 1.