Budget Implementation Act, 2004, No. 2 (S.C. 2005, c. 19)
Full Document:
Assented to 2005-05-13
21. (1) Paragraph 115(1)(b) of the Act is replaced by the following:
(b) the only taxable capital gains and allowable capital losses referred to in paragraph 3(b) were taxable capital gains and allowable capital losses from dispositions, other than dispositions deemed under subsection 218.3(2), of taxable Canadian properties (other than treaty-protected properties), and
(2) Subsection (1) applies after 2004.
22. (1) The portion of subsection 117.1(1) of the Act before paragraph (a) is replaced by the following:
Marginal note:Annual adjustment
117.1 (1) Each of the amounts expressed in dollars in subsection 117(2), the description of B in subsection 118(1), subsection 118(2), the descriptions of C and F in subsection 118.2(1), subsections 118.3(1), 122.5(3) and 122.51(1) and (2) and Part I.2 in relation to tax payable under this Part or Part I.2 for a taxation year shall be adjusted so that the amount to be used under those provisions for the year is the total of
(2) Subsection (1) applies to the 2004 and subsequent taxation years.
23. (1) Paragraph 118.1(5.2)(a) of the Act is replaced by the following:
(a) for the purpose of this section (other than subsection (5.1) and this paragraph) and section 149.1, 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
(2) Paragraph 118.1(5.3)(a) of the Act is replaced by the following:
(a) for the purposes of this section (other than this paragraph) and section 149.1, the transfer is deemed to be a gift made, immediately before the individual’s death, by the individual to the donee; and
(3) Subsections (1) and (2) apply in respect of deaths that occur after 1998.
24. (1) Subsection 118.2(1) of the Act is replaced by the following:
Marginal note:Medical expense credit
118.2 (1) For the purpose of computing the tax payable under this Part by an individual for a taxation year, there may be deducted the amount determined by the formula
A x [(B - C) + D]
where
- A
- is the appropriate percentage for the taxation year;
- B
- is the total of the individual’s medical expenses in respect of the individual, the individual’s spouse, the individual’s common-law partner or a child of the individual who has not attained the age of 18 years before the end of the taxation year
(a) that are evidenced by receipts filed with the Minister,
(b) that were not included in determining an amount under this subsection, section 64 or subsection 122.51(2), for a preceding taxation year,
(c) that are not included in determining an amount under this subsection, section 64 or subsection 122.51(2), by any other taxpayer for any taxation year, and
(d) that were paid by the individual or the individual’s legal representative within any period of 12 months that ends in the taxation year or, if those expenses were in respect of a person (including the individual) who died in the taxation year, within any period of 24 months that includes the day of the person’s death;
- C
- is the lesser of $1,813 and 3% of the individual’s income for the taxation year; and
- D
- is the total of all amounts each of which is, in respect of a dependant of the individual (within the meaning assigned by subsection 118(6), other than a child of the individual who has not attained the age of 18 years before the end of the taxation year), the lesser of $5,000 and the amount determined by the formula
E - F
where
- E
- is the total of the individual’s medical expenses in respect of the dependant
(a) that are evidenced by receipts filed with the Minister,
(b) that were not included in determining an amount under this subsection, or subsection 122.51(2), in respect of the individual for a preceding taxation year,
(c) that are not included in determining an amount under this subsection, or subsection 122.51(2), by any other taxpayer for any taxation year, and
(d) that were paid by the individual or the individual’s legal representative within the period referred to in paragraph (d) of the description of B; and
- F
- is the lesser of $1,813 and 3% of the dependant’s income for the taxation year.
(2) Subsection (1) applies to the 2004 and subsequent taxation years.
(3) For the 2001 to 2003 taxation years, the description of B in subsection 118.2(1) of the Act is to be read as follows:
- B
- is the total of the individual’s medical expenses
(a) that are evidenced by receipts filed with the Minister,
(b) that were not included in determining an amount under this subsection or subsection 122.51(2) for a preceding taxation year, and
(c) that were paid by the individual or the individual’s legal representative within any period of 12 months that ends in the taxation year or, if those expenses were in respect of a person (including the individual) who died in the taxation year, within any period of 24 months that includes the day of the person’s death;
25. (1) The definition “qualifying educational program” in subsection 118.6(1) of the Act is replaced by the following:
“qualifying educational program”
« programme de formation admissible »
“qualifying educational program” means a program of not less than three consecutive weeks duration that provides that each student taking the program spend not less than ten hours per week on courses or work in the program and, in respect of a program at an institution described in the definition “designated educational institution” (other than an institution described in subparagraph (a)(ii) of that definition), that is a program at a post-secondary school level but, in relation to any particular student, does not include a program if the student receives, from a person with whom the student is dealing at arm’s length, any allowance, benefit, grant or reimbursement for expenses in respect of the program other than
(a) an amount received by the student as or on account of a scholarship, fellowship or bursary, or a prize for achievement in a field of endeavour ordinarily carried on by the student,
(b) a benefit, if any, received by the student because of a loan made to the student in accordance with the requirements of the Canada Student Loans Act or An Act respecting financial assistance for education expenses, R.S.Q., c. A-13.3, or because of financial assistance given to the student in accordance with the requirements of the Canada Student Financial Assistance Act, or
(c) an amount that is received by the student in the year under a program referred to in subparagraph 56(1)(r)(ii) or (iii), a program established under the authority of the Department of Human Resources Development Act or a prescribed program;
(2) Subsection (1) applies to the 2004 and subsequent taxation years.
(3) For the 1998 to 2003 taxation years, subparagraph (a)(ii) of the definition “qualifying educational program” in subsection 118.6(1) of the Act is to be read as follows:
(ii) a benefit, if any, received by the student because of a loan made to the student in accordance with the requirements of the Canada Student Loans Act or An Act respecting financial assistance for education expenses, R.S.Q., c. A-13.3, or because of financial assistance given to the student in accordance with the requirements of the Canada Student Financial Assistance Act, or
26. (1) Paragraph (b) of the description of A in subsection 122.51(2) of the Act is replaced by the following:
(b) the total of
(i) 25/16 of the total of all amounts each of which is the amount determined by the formula in subsection 118.2(1) for the purpose of computing the individual’s tax payable under this Part for a taxation year that ends in the calendar year, and
(ii) 25% of the total of all amounts each of which is the amount deductible under section 64 in computing the individual’s income for a taxation year that ends in the calendar year; and
(2) Subsection (1) applies to the 2004 and subsequent taxation years.
27. (1) Paragraph 126(2)(a) of the Act is replaced by the following:
(a) such part of the total of the business-income tax paid by the taxpayer for the year in respect of businesses carried on by the taxpayer in that country and the taxpayer’s unused foreign tax credits in respect of that country for the 10 taxation years immediately preceding and the 3 taxation years immediately following the year as the taxpayer may claim,
(2) Subsection (1) applies in respect of unused foreign tax credits computed for taxation years that end after March 22, 2004.
28. (1) Paragraph (a) of the definition “flow-through mining expenditure” in subsection 127(9) of the Act is replaced by the following:
(a) that is a Canadian exploration expense incurred after October 17, 2000 and before 2006 by a corporation in conducting mining exploration activity from or above the surface of the earth for the purpose of determining the existence, location, extent or quality of a mineral resource described in paragraph (a) or (d) of the definition “mineral resource” in subsection 248(1),
(2) Section 127 of the Act is amended by adding the following after subsection (10.21):
Marginal note:Expenditure limits — associated CCPCs
(10.22) If a particular Canadian-controlled private corporation is associated with another corporation in circumstances where those corporations would not be associated if the Act were read without reference to paragraph 256(1.2)(a), the particular corporation has issued shares to one or more persons who have been issued shares by the other corporation and there is at least one shareholder of the particular corporation who is not a shareholder of the other corporation or one shareholder of the other corporation who is not a shareholder of the particular corporation, the particular corporation is not associated with the other corporation for the purpose of
(a) determining the particular corporation’s expenditure limit under subsection (10.2); and
(b) determining the particular corporation’s business limit under section 125, as applied for the purpose only of determining the particular corporation’s expenditure limit under subsection (10.2).
Marginal note:Application of subsection (10.22)
(10.23) Subsection (10.22) applies to the particular corporation and the other corporation referred to in that subsection only if the Minister is satisfied that
(a) the particular corporation and the other corporation are not otherwise associated under this Act; and
(b) the existence of one or more shareholders of the particular corporation who is not a shareholder of the other corporation, or the existence of one or more shareholders of the other corporation who is not a shareholder of the particular corporation, is not for the purpose of satisfying the requirements of subsection (10.22) or 127.1(2.2).
(3) Subsection (1) applies after March 23, 2004.
(4) Subsection (2) applies to taxation years that end after March 22, 2004.
- Date modified: