Budget Implementation Act, 2017, No. 2 (S.C. 2017, c. 33)
Full Document:
Assented to 2017-12-14
54 (1) The portion of paragraph 138.1(1)(a) of the Act before subparagraph (i) is replaced by the following:
(a) a trust (in this section and section 138.2 referred to as the “related segregated fund trust”) is deemed to be created at the time that is the later of
(2) Paragraph 138.1(1)(f) of the Act is replaced by the following:
(f) the taxable income of the related segregated fund trust is deemed for the purposes of subsections 104(6), (13) and (24) to be an amount that has become payable in the year to the beneficiaries under the segregated fund trust and the amount therefor in respect of any particular beneficiary is equal to the amount determined by reference to the terms and conditions of the segregated fund policy;
(3) Section 138.1 of the Act is amended by adding the following after subsection (2):
Marginal note:Transition — pre-2018 non-capital losses
(2.1) For the purpose of determining the taxable income of a related segregated fund trust for a taxation year that begins after 2017, the non-capital losses of the related segregated fund trust that arise in a taxation year that begins before 2018 are deemed to be nil.
(4) Subsections (1) and (2) apply to taxation years that begin after 2017.
55 (1) The Act is amended by adding the following after section 138.1:
Marginal note:Qualifying transfer of funds
138.2 (1) For the purposes of this section, a qualifying transfer occurs at a particular time (in this section referred to as the “transfer time”) if
(a) all of the property that, immediately before the transfer time, was property of a related segregated fund trust has become, at the transfer time, the property of another related segregated fund trust (in this section referred to as the “transferor” and “transferee”, respectively, and collectively as the “funds”);
(b) every person that had an interest in the transferor immediately before the transfer time (in this section referred to as a “beneficiary”) has ceased to be a beneficiary of the transferor at the transfer time and has received no consideration for the interest other than an interest in the transferee;
(c) the trustee of the funds is a resident of Canada; and
(d) the trustee of the funds so elects, by filing a prescribed form with the Minister on or before the election’s due date.
Marginal note:General
(2) If there has been a qualifying transfer,
(a) the last taxation years of the funds that began before the transfer time are deemed to have ended at the transfer time and the next taxation year of the transferee is deemed to have begun immediately after the transfer time;
(b) no amount in respect of a non-capital loss, net capital loss, restricted farm loss, farm loss or limited partnership loss of a fund for a taxation year that began before the transfer time is deductible in computing the taxable income of the funds for a taxation year that begins after the transfer time;
(c) each beneficiary’s interest in the transferor is deemed to have been disposed of at the transfer time for proceeds of disposition, and each beneficiary’s interest in the transferee received in the qualifying transfer is deemed to have been acquired at a cost, equal to the cost amount to the beneficiary of the interest in the transferor immediately before the transfer time;
(d) any amount determined under subsection 138.1(6) in respect of a policyholder’s interest in the transferor is deemed
(e) subsections 138.1(4) and (5) do not apply in respect of any disposition of an interest in the transferor arising on the qualifying transfer.
Marginal note:Transferor – capital gains and losses
(3) In respect of a qualifying transfer, each property of the transferor held immediately before the transfer time is deemed to have been disposed of by the transferor immediately before the transfer time for proceeds of disposition, and to have been acquired by the transferee at the transfer time for a cost, equal to the lesser of
Marginal note:Transferee – capital gains and losses
(4) In respect of a qualifying transfer, each property of the transferee held immediately before the transfer time is deemed to have been disposed of by the transferee immediately before the transfer time for proceeds of disposition, and to have been reacquired by the transferee at the transfer time for a cost, equal to the lesser of
Marginal note:Loss limitation
(5) Subsection 138.1(3) does not apply to capital losses of a fund from the disposition of property on a qualifying transfer under subsection (3) or (4) to the extent that the amount of such capital losses exceeds the amount of capital gains of the fund from the disposition of property on the qualifying transfer under subsection (3) or (4), as the case may be.
Marginal note:Due date
(6) The due date of an election referred to in paragraph (1)(d) is the later of
(2) Subsection (1) comes into force, or is deemed to have come into force, on January 1, 2018.
56 (1) Clause (b)(iii)(B) of the definition retirement savings plan in subsection 146(1) of the Act is replaced by the following:
(B) a credit union that is a shareholder or member of a body corporate referred to as a “central” for the purposes of the Canadian Payments Act,
(2) Subsection 146(21.2) of the Act is replaced by the following:
Marginal note:Specified pension plan — account
(21.2) For the purposes of paragraph (8.2)(b), subsection (8.21), paragraphs (16)(a) and (b) and 18(1)(u), subparagraph (a)(i) of the definition excluded right or interest in subsection 128.1(10), paragraph (b) of the definition excluded premium in subsection 146.01(1), paragraph (c) of the definition excluded premium in subsection 146.02(1), subsections 146.3(14) and 147(19), section 147.3 and paragraphs 147.5(21)(c) and 212(1)(j.1) and (m) and for the purposes of any regulations made under subsection 147.1(18), an individual’s account under a specified pension plan is deemed to be a registered retirement savings plan under which the individual is the annuitant.
(3) Subsection (1) is deemed to have come into force on October 24, 2001.
(4) Subsection (2) is deemed to have come into force on January 1, 2010, except that in its application before December 14, 2012, subsection 146(21.2) of the Act, as enacted by subsection (2), is to be read without reference to “147.5(21)(c) and”.
57 (1) Paragraph (b) of the definition education savings plan in subsection 146.1(1) of the Act is replaced by the following:
(b) a person (in this definition referred to as the “promoter”)
(2) Subsection 146.1(1) of the Act is amended by adding the following in alphabetical order:
- promoter
promoter, of an arrangement, means the person described as the promoter in the definition education savings plan; (promoteur)
(3) Paragraphs 146.1(2.1)(a) and (b) of the Act are repealed.
(4) Subsection 146.1(5) of the Act is replaced by the following:
Marginal note:Trust not taxable
(5) No tax is payable under this Part by a trust that is governed by a RESP on its taxable income for a taxation year, except that, if at any time in the taxation year, it holds one or more properties that are not qualified investments for the trust, tax is payable under this Part by the trust on the amount that would be its taxable income for the taxation year if it had no income or losses from sources other than those properties, and no capital gains or capital losses other than from dispositions of those properties, and for that purpose,
(a) income includes dividends described in section 83;
(b) the trust’s taxable capital gain or allowable capital loss from the disposition of a property is equal to its capital gain or capital loss, as the case may be, from the disposition; and
(c) the trust’s income shall be computed without reference to subsection 104(6).
(5) Subsection 146.1(7) of the Act is replaced by the following:
Marginal note:Educational assistance payments
(7) There shall be included in computing an individual’s income for a taxation year the total of all educational assistance payments paid out of registered education savings plans to or for the individual in the year that exceeds the total of all excluded amounts in respect of those plans and the individual for the year.
(6) Paragraph 146.1(7.1)(a) of the Act is replaced by the following:
(a) each accumulated income payment (other than an accumulated income payment made under subsection (1.2)) received in the year by the taxpayer under a registered education savings plan that exceeds the total of all excluded amounts in respect of those plans and the individual for the year; and
(7) Subsection 146.1(7.2) of the Act is replaced by the following:
Marginal note:Excluded amount
(7.2) An excluded amount in respect of a registered education savings plan is,
(a) for the purposes of subsection (7) and paragraph (7.1)(a), an amount in respect of which a subscriber pays a tax under section 207.05 in respect of the plan, or another plan for which the plan was substituted by the subscriber, that
(b) for the purposes of paragraph (7.1)(b),
(i) any amount received under the plan,
(ii) any amount received in satisfaction of a right to a refund of payments under the plan, or
(iii) any amount received by a taxpayer under a decree, order or judgment of a competent tribunal, or under a written agreement, relating to a division of property between the taxpayer and the taxpayer’s spouse or common-law partner or former spouse or common-law partner in settlement of rights arising out of, or on the breakdown of, their marriage or common-law partnership.
(8) Subsections (1), (2) and (5) to (7) are deemed to have come into force on March 23, 2017.
(9) Subsections (3) and (4) apply in respect of
- Date modified: