Income Tax Amendments Act, 2000 (S.C. 2001, c. 17)
Full Document:
Assented to 2001-06-14
91. (1) The portion of subsection 116(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Disposition by non-resident person of certain property
116. (1) If a non-resident person proposes to dispose of any taxable Canadian property (other than property described in subsection (5.2) and excluded property) the non-resident person may, at any time before the disposition, send to the Minister a notice setting out
(2) Subsections 116(2), (4) and (5) of the Act are amended by replacing the reference to the percentage “33 1/3%” with a reference to the percentage “25%”.
(3) The portion of subsection 116(5.1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Gifts, etc.
(5.1) If a non-resident person has disposed of or proposes to dispose of a life insurance policy in Canada, a Canadian resource property or a taxable Canadian property other than
(4) The portion of subsection 116(5.2) of the Act before paragraph (a) is replaced by the following:
Marginal note:Certificates for dispositions
(5.2) If a non-resident person has, in respect of a disposition or proposed disposition to a taxpayer in a taxation year of property (other than excluded property) that is a life insurance policy in Canada, a Canadian resource property, a property (other than capital property) that is real property situated in Canada, a timber resource property, depreciable property that is a taxable Canadian property or any interest in or option in respect of a property to which this subsection applies (whether or not that property exists),
(5) Paragraphs 116(6)(a) and (b) of the Act are replaced by the following:
(a) a property that is a taxable Canadian property solely because a provision of this Act deems it to be a taxable Canadian property;
(a.1) a property (other than real property situated in Canada, a Canadian resource property or a timber resource property) that is described in an inventory of a business carried on in Canada by the person;
(b) a share of a class of shares of the capital stock of a corporation that is listed on a prescribed stock exchange;
(6) Subsection 116(6) of the Act is amended by striking out the word “or” at the end of paragraph (d) and by replacing paragraph (e) with the following:
(e) property of a non-resident insurer that
(i) is licensed or otherwise authorized under the laws of Canada or a province to carry on an insurance business in Canada, and
(ii) carries on an insurance business, within the meaning of subsection 138(1) of the Act, in Canada;
(f) property of an authorized foreign bank that is used or held in the course of the bank’s Canadian banking business;
(g) an option in respect of property referred to in any of paragraphs (a) to (f) whether or not such property is in existence; and
(h) an interest in property referred to in any of paragraphs (a) to (g).
(7) Subsections (1), (3) and (4) and paragraphs 116(6)(a) and (a.1) of the Act, as enacted by subsection (5), apply after October 1, 1996.
(8) Subsection (2) applies to taxation years that end after February 27, 2000 except that, for a taxation year that ended after February 27, 2000 and before October 18, 2000, the reference in subsections 116(2), (4) and (5) of the Act, as enacted by subsection (2), to the percentage “25%” shall be read as a reference to the percentage “30%”.
(9) Paragraph 116(6)(b) of the Act, as enacted by subsection (5), and subsection (6) apply after June 27, 1999.
92. (1) Subsection 117(2) of the Act is replaced by the following:
Marginal note:Rate for 2000
(2) The tax payable under this Part by an individual on the individual’s taxable income or taxable income earned in Canada, as the case may be, (in this subdivision referred to as the “amount taxable”) for the 2000 taxation year is
(a) 17% of the amount taxable, if the amount taxable does not exceed $30,004;
(b) $5,101 plus 25% of the amount by which the amount taxable exceeds $30,004, if the amount taxable exceeds $30,004 and does not exceed $60,009; and
(c) $12,602 plus 29% of the amount by which the amount taxable exceeds $60,009, if the amount taxable exceeds $60,009.
(2) Subsection 117(2) of the Act, as enacted by subsection (1), is replaced by the following:
Marginal note:Rates for years after 2000
(2) The tax payable under this Part by an individual on the individual’s taxable income or taxable income earned in Canada, as the case may be, (in this subdivision referred to as the “amount taxable”) for a taxation year is
(a) 16% of the amount taxable, if the amount taxable does not exceed $30,754;
(b) $4,921 plus 22% of the amount by which the amount taxable exceeds $30,754, if the amount taxable exceeds $30,754 and does not exceed $61,509;
(b.1) $11,687 plus 26% of the amount by which the amount taxable exceeds $61,509, if the amount taxable exceeds $61,509 and does not exceed $100,000; and
(c) $21,695 plus 29% of the amount by which the amount taxable exceeds $100,000, if the amount taxable exceeds $100,000.
Marginal note:Minimum thresholds for 2004
(3) Each of the amounts of $30,754, $61,509 and $100,000 referred to in subsection (2) is deemed, for the purposes of applying subsection (2) to the 2004 taxation year, to be the greater of
(a) the amount that would be used for the 2004 taxation year if this section were read without reference to this subsection, and
(b) in the case of
(i) the amount of $30,754, $35,000,
(ii) the amount of $61,509, $70,000, and
(iii) the amount of $100,000, $113,804.
(3) Subsection (1) applies to the 2000 taxation year.
(4) Subsection 117(2) of the Act, as enacted by subsection (2), applies to the 2001 and subsequent taxation years.
93. (1) Clause (c.1)(ii)(B) of the description of B in subsection 118(1) of the Act is replaced by the following:
(B) resident in Canada and is the parent, grandparent, brother, sister, aunt, uncle, nephew or niece of the individual or of the individual’s spouse or common-law partner, and
(2) The portion of paragraph 118(1)(c.1) of the Act after subparagraph (iii) is replaced by the following:
the amount determined by the formula
$15,453 – D.1
where
- D.1
- is the greater of $11,953 and the particular person’s income for the year,
(3) The portion of paragraph 118(1)(d) of the Act after subparagraph (ii) is replaced by the following:
the amount determined by the formula
$8,466 – E
where
- E
- is the greater of $4,966 and the dependant’s income for the year, and
(4) Section 118 of the Act is amended by adding the following after subsection (3):
Marginal note:Minimum amounts for 2004
(3.1) Each of the amounts of $7,131, $6,055 and $606 referred to in paragraphs (a) to (c) of the description of B in subsection (1) is deemed, for the 2004 taxation year, to be the greater of
(a) the amount in respect thereof that would be used for that year if this section were read without reference to this subsection, and
(b) in the case of
(i) the amounts of $7,131, $8,000,
(ii) the amounts of $6,055, $6,800, and
(iii) the amounts of $606, $680.
(5) Subsection (1) applies to the 1998 and subsequent taxation years, except that clause (c.1)(ii)(B) of the description of B in subsection 118(1) of the Act, as enacted by subsection (1), shall be read without reference to “or common-law partner” for any taxation year that ends before 2001 unless a valid election is made by the taxpayer under section 144 of the Modernization of Benefits and Obligations Act, that that Act apply to the taxpayer in respect of one or more taxation years that includes the year.
(6) Subsections (2) and (3) apply to the 2001 and subsequent taxation years.
94. (1) The portion of the definition “total ecological gifts” in subsection 118.1(1) of the Act before paragraph (a) is replaced by the following:
“total ecological gifts”
« total des dons de biens écosensibles »
“total ecological gifts” of an individual for a taxation year means the total of all amounts each of which is the fair market value of a gift (other than a gift the fair market value of which is included in the total cultural gifts of the individual for the year) of land, including a servitude for the use and benefit of a dominant land, a covenant or an easement, the fair market value of which is certified by the Minister of the Environment and that is certified by that Minister, or a person designated by that Minister, to be ecologically sensitive land, the conservation and protection of which is, in the opinion of that Minister, or that person, important to the preservation of Canada’s environmental heritage, which gift was made by the individual in the year or in any of the five immediately preceding taxation years to
(2) Subsection 118.1(2) of the Act is replaced by the following:
Marginal note:Proof of gift
(2) A gift shall not be included in the total charitable gifts, total Crown gifts, total cultural gifts or total ecological gifts of an individual unless the making of the gift is proven by filing with the Minister
(a) a receipt for the gift that contains prescribed information;
(b) in the case of a gift described in the definition “total cultural gifts” in subsection (1), the certificate issued under subsection 33(1) of the Cultural Property Export and Import Act; and
(c) in the case of a gift described in the definition “total ecological gifts” in subsection (1), both certificates referred to in that definition.
(3) Subsection 118.1(4) of the Act is replaced by the following:
Marginal note:Gift in year of death
(4) Subject to subsection (13), a gift made by an individual in the particular taxation year in which the individual dies (including, for greater certainty, a gift otherwise deemed by subsection (5), (5.2), (5.3), (7), (7.1), (13) or (15) to have been so made) is deemed, for the purpose of this section other than this subsection, to have been made by the individual in the preceding taxation year, and not in the particular year, to the extent that an amount in respect of the gift is not deducted in computing the individual’s tax payable under this Part for the particular year.
(4) Section 118.1 of the Act is amended by adding the following after subsection (5):
Marginal note:Direct designation — insurance proceeds
(5.1) Subsection (5.2) applies to an individual in respect of a life insurance policy where
(a) the policy is a life insurance policy under which, immediately before the individual’s death, the individual’s life was insured;
(b) a transfer of money, or a transfer by means of a negotiable instrument, is made as a consequence of the individual’s death and solely because of the obligations under the policy, from an insurer to a qualified donee (other than a transfer the amount of which is not included in computing the income of the individual or the individual’s estate for any taxation year but would have been included in computing the income of the individual or the individual’s estate for a taxation year if the transfer had been made to the individual’s legal representative for the benefit of the individual’s estate and this Act were read without reference to subsection 70(3));
(c) immediately before the individual’s death,
(i) the individual’s consent would have been required to change the recipient of the transfer described in paragraph (b), and
(ii) the donee was neither a policyholder under the policy, nor an assignee of the individual’s interest under the policy; and
(d) the transfer occurs within the 36 month period that begins at the time of the death (or, where written application to extend the period has been made to the Minister by the individual’s legal representative, within such longer period as the Minister considers reasonable in the circumstances).
Marginal note:Deemed gift — subsection (5.1)
(5.2) Where this subsection applies,
(a) for the purpose of this section (other than subsection (5.1) and this paragraph), the transfer described in subsection (5.1) is deemed to be a gift made, immediately before the individual’s death, by the individual to the qualified donee referred to in subsection (5.1); and
(b) the fair market value of the gift is deemed to be the fair market value, at the time of the individual’s death, of the right to that transfer (determined without reference to any risk of default with regard to obligations of the insurer).
Marginal note:Direct designation — RRSPs and RRIFs
(5.3) Where as a consequence of an individual’s death, a transfer of money, or a transfer by means of a negotiable instrument, is made, from a registered retirement savings plan or registered retirement income fund (other than a plan or fund of which a licensed annuities provider is the issuer or carrier, as the case may be) to a qualified donee, solely because of the donee’s interest as a beneficiary under the plan or fund, the individual was the annuitant (within the meaning assigned by subsection 146(1) or 146.3(1)) under the plan or fund immediately before the individual’s death and the transfer occurs within the 36-month period that begins at the time of the death (or, where written application to extend the period has been made to the Minister by the individual’s legal representative, within such longer period as the Minister considers reasonable in the circumstances),
(a) for the purposes of this section (other than this paragraph), the transfer is deemed to be a gift made, immediately before the individual’s death, by the individual to the donee; and
(b) the fair market value of the gift is deemed to be the fair market value, at the time of the individual’s death, of the right to the transfer (determined without reference to any risk of default with regard to the obligations of the issuer of the plan or the carrier of the fund).
(5) The portion of subsection 118.1(6) of the Act after paragraph (b) is replaced by the following:
and the fair market value of the property otherwise determined at that time exceeds its adjusted cost base to the individual, such amount, not greater than the fair market value and not less than the adjusted cost base to the individual of the property at that time, as the individual or the individual’s legal representative designates in the individual’s return of income under section 150 for the year in which the gift is made is, if the making of the gift is proven by filing with the Minister a receipt containing prescribed information, deemed to be the individual’s proceeds of disposition of the property and, for the purposes of subsection (1), the fair market value of the gift made by the individual.
(6) Subsections 118.1(7) and (7.1) of the Act are replaced by the following:
Marginal note:Gifts of art
(7) Except where subsection (7.1) applies, where at any time, whether by the individual’s will or otherwise, an individual makes a gift described in the definition “total charitable gifts” or “total Crown gifts” in subsection (1) of a work of art that was
(a) created by the individual and that is property in the individual’s inventory, or
(b) acquired under circumstances where subsection 70(3) applied,
and at that time the fair market value of the work of art exceeds its cost amount to the individual, the following rules apply:
(c) where the gift is made as a consequence of the death of the individual, the gift is deemed to have been made immediately before the death, and
(d) the amount, not greater than that fair market value at the time the gift is made and not less than the cost amount of the property to the individual, that is designated in the individual’s return of income under section 150 for the year in which the gift is made is, if the making of the gift is proven by filing with the Minister a receipt containing prescribed information, deemed to be the individual’s proceeds of disposition of the work of art and, for the purposes of subsection (1), the fair market value of the gift made by the individual.
Marginal note:Gifts of cultural property
(7.1) Where at any particular time, whether by the individual’s will or otherwise, an individual makes a gift described in the definition “total cultural gifts” in subsection (1) of a work of art that was
(a) created by the individual and that is property in the individual’s inventory, or
(b) acquired under circumstances where subsection 70(3) applied,
and at that time the fair market value of the work of art exceeds its cost amount to the individual, the following rules apply:
(c) where the gift is made as a consequence of the death of the individual, the individual is deemed to have made the gift immediately before the death, and
(d) the individual is deemed to have received at the particular time proceeds of disposition in respect of the gift equal to its cost amount to the individual at that time.
(7) Subsection 118.1(10.1) of the Act is replaced by the following:
Marginal note:Determination of fair market value
(10.1) For the purposes of subparagraph 69(1)(b)(ii), subsection 70(5) and sections 110.1, 207.31 and this section, where at any time the Canadian Cultural Property Export Review Board or the Minister of the Environment determines or redetermines an amount to be the fair market value of a property that is the subject of a gift described in paragraph 110.1(1)(a), or in the definition “total charitable gifts” in subsection (1), made by a taxpayer within the two-year period that begins at that time, an amount equal to the last amount so determined or redetermined within the period is deemed to be the fair market value of the gift at the time the gift was made and, subject to subsections (6), (7), (7.1) and 110.1(3), to be the taxpayer’s proceeds of disposition of the gift.
Marginal note:Request for determination by the Minister of the Environment
(10.2) Where a person disposes or proposes to dispose of a property that would, if the disposition were made and the certificates described in paragraph 110.1(1)(d) or in the definition “total ecological gifts” in subsection (1) were issued by the Minister of the Environment, be a gift described in those provisions, the person may request, by notice in writing to that Minister, a determination of the fair market value of the property.
Marginal note:Duty of Minister of the Environment
(10.3) In response to a request made under subsection (10.2), the Minister of the Environment shall with all due dispatch make a determination in accordance with subsection (12) or 110.1(5), as the case may be, of the fair market value of the property referred to in that request and give notice of the determination in writing to the person who has disposed of, or who proposes to dispose of, the property, except that no such determination shall be made if the request is received by that Minister after three years after the end of the person’s taxation year in which the disposition occurred.
Marginal note:Ecological gifts — redetermination
(10.4) Where the Minister of the Environment has, under subsection (10.3), notified a person of the amount determined by that Minister to be the fair market value of a property in respect of its disposition or proposed disposition,
(a) that Minister shall, on receipt of a written request made by the person on or before the day that is 90 days after the day that the person was so notified of the first such determination, with all due dispatch confirm or redetermine the fair market value;
(b) that Minister may, on that Minister’s own initiative, at any time redetermine the fair market value;
(c) that Minister shall in either case notify the person in writing of that Minister’s confirmation or redetermination; and
(d) any such redetermination is deemed to replace all preceding determinations and redeterminations of the fair market value of that property from the time at which the first such determination was made.
Marginal note:Certificate of Fair Market Value
(10.5) Where the Minister of the Environment determines under subsection (10.3) the fair market value of a property, or redetermines that value under subsection (10.4), and the property has been disposed of to a qualified donee described in paragraph 110.1(1)(d) or in the definition “total ecological gifts” in subsection (1), that Minister shall issue to the person who made the disposition a certificate that states the fair market value of the property so determined or redetermined and, where more than one certificate has been so issued, the last certificate is deemed to replace all preceding certificates from the time at which the first certificate was issued.
(8) Subsection 118.1(11) of the Act is replaced by the following:
Marginal note:Assessments
(11) Notwithstanding subsections 152(4) to (5), such assessments or reassessments of a taxpayer’s tax, interest or penalties payable under this Act for any taxation year shall be made as are necessary to give effect
(a) to a certificate issued under subsection 33(1) of the Cultural Property Export and Import Act or to a decision of a court resulting from an appeal made pursuant to section 33.1 of that Act; or
(b) to a certificate issued under subsection (10.5) or to a decision of a court resulting from an appeal made pursuant to subsection 169(1.1).
(9) Subsection 118.1(12) of the Act is replaced by the following:
Marginal note:Ecological gifts
(12) For the purpose of applying subparagraph 69(1)(b)(ii), subsection 70(5), section 207.31 and this section in respect of a gift described in the definition “total ecological gifts” in subsection (1) that is made by a taxpayer and that is a servitude, covenant or easement to which land is subject, the greater of
(a) the fair market value otherwise determined of the gift, and
(b) the amount by which the fair market value of the land is reduced as a result of the making of the gift
is deemed to be the fair market value (or, for the purpose of subsection (6), the fair market value otherwise determined) of the gift at the time the gift was made and, subject to subsection (6), to be the taxpayer’s proceeds of disposition of the gift.
(10) Subsection 118.1(12) of the Act, as enacted by subsection (9), is replaced by the following:
Marginal note:Ecological gifts
(12) For the purposes of applying subparagraph 69(1)(b)(ii), subsection 70(5), this section and section 207.31 in respect of a gift described in the definition “total ecological gifts” in subsection (1) that is made by an individual, the amount that is the fair market value (or, for the purpose of subsection (6), the fair market value otherwise determined) of the gift at the time the gift was made and, subject to subsection (6), the individual’s proceeds of disposition of the gift, is deemed to be the amount determined by the Minister of the Environment to be
(a) where the gift is land, the fair market value of the gift; or
(b) where the gift is a servitude, covenant or easement to which land is subject, the greater of
(i) the fair market value otherwise determined of the gift, and
(ii) the amount by which the fair market value of the land is reduced as a result of the making of the gift.
(11) Subsections (1), (2), (7), (8) and (10) apply in respect of gifts made, or proposed to be made, after February 27, 2000 except that subsection 118.1(2) of the Act, as enacted by subsection (2), shall be read without reference to paragraph 118.1(2)(b) in respect of gifts made before December 21, 2000.
(12) Subject to subsection (13), subsections (3) and (4) apply in respect of deaths that occur after 1998.
(13) For taxation years before 2000, subsection 118.1(4) of the Act, as enacted by subsection (3), shall be read without reference to subsections 118.1(7) and (7.1) of the Act except that, where a taxpayer or a taxpayer’s legal representative notifies the Minister of National Revenue in writing before 2002 of the intention of the taxpayer or the taxpayer’s legal representative that this subsection apply in respect of a gift made after 1996 and before 2000, subsection 118.1(4) of the Act, as enacted by subsection (3), applies to the taxation year in which the gift was made and shall be read, in respect of the 1996 to 1998 taxation years, without reference to subsections 118.1(5.2) and (5.3) of the Act.
(14) Subsection (5) applies in respect of gifts made after February 27, 1995.
(15) Subsection (6) applies to the 2000 and subsequent taxation years and, where a taxpayer or a taxpayer’s legal representative notifies the Minister of National Revenue in writing before 2002 of the intention of the taxpayer or the taxpayer’s legal representative that this subsection apply in respect of a gift made after 1996 and before 2000, subsection (6) applies to the taxation year in which the gift was made and, where paragraph 118.1(7)(d) of the Act, as enacted by subsection (6), applies, the amount designated in the notice in respect of the gift is deemed to have been validly designated for the purposes of that paragraph in the taxpayer’s return of income for the year in which the gift was made.
(16) Subsection (9) applies in respect of gifts made after February 27, 1995 and before February 28, 2000.
- Date modified: