Budget Implementation Act, 2017, No. 2 (S.C. 2017, c. 33)
Full Document:
Assented to 2017-12-14
58 (1) The portion of paragraph (d) of the definition contribution in subsection 146.4(1) of the Act before subparagraph (i) is replaced by the following:
(d) other than for the purposes of paragraphs (4)(f) to (h) and (n),
(2) The portion of subparagraph (a)(i) of the definition disability savings plan in subsection 146.4(1) of the Act before clause (A) is replaced by the following:
(i) a corporation (in this definition referred to as the “issuer”)
(3) The description of A in the definition specified maximum amount in subsection 146.4(1) of the Act is replaced by the following:
- A
- is 10% of the fair market value of the property held by the plan trust at the beginning of the calendar year (other than annuity contracts held by the plan trust that, at the beginning of the calendar year, are not described in paragraph (b) of the definition qualified investment), and
(4) Subparagraph (i) of the description of B in the definition specified maximum amount in subsection 146.4(1) of the Act is replaced by the following:
(i) a periodic payment under an annuity contract held by the plan trust at the beginning of the calendar year (other than an annuity contract described at the beginning of the calendar year in paragraph (b) of the definition qualified investment) that is paid to the plan trust in the calendar year, or
(5) The portion of the definition specified year in subsection 146.4(1) of the Act before paragraph (a) is replaced by the following:
- specified year
specified year, for a disability savings plan of a beneficiary means the particular calendar year in which a medical doctor or a nurse practitioner licensed to practise under the laws of a province (or of the place where the beneficiary resides) certifies in writing that the beneficiary’s state of health is such that, in the professional opinion of the medical doctor or the nurse practitioner, the beneficiary is not likely to survive more than five years and
(6) Subsection 146.4(1) of the Act is amended by adding the following in alphabetical order:
- issuer
issuer, of an arrangement, means the person described as the “issuer” in the definition disability savings plan. (émetteur)
- qualified investment
qualified investment, for a trust governed by a RDSP, means
(a) an investment that would be described by any of paragraphs (a) to (d), (f) and (g) of the definition qualified investment in section 204 if the reference in that definition to “a trust governed by a deferred profit sharing plan or revoked plan” were read as a reference to “a trust governed by a RDSP” and if that definition were read without reference to the words “with the exception of excluded property in relation to the trust”;
(b) a contract for an annuity issued by a licensed annuities provider where
(i) the trust is the only person who, disregarding any subsequent transfer of the contract by the trust, is or may become entitled to any annuity payments under the contract, and
(ii) the holder of the contract has a right to surrender the contract at any time for an amount that would, if reasonable sales and administration charges were ignored, approximate the value of funds that could otherwise be applied to fund future periodic payments under the contract;
(c) a contract for an annuity issued by a licensed annuities provider where
(i) annual or more frequent periodic payments are or may be made under the contract to the holder of the contract,
(ii) the trust is the only person who, disregarding any subsequent transfer of the contract by the trust, is or may become entitled to any annuity payments under the contract,
(iii) neither the time nor the amount of any payment under the contract may vary because of the length of any life, other than the life of the beneficiary under the plan,
(iv) the day on which the periodic payments began or are to begin is not later than the end of the later of
(v) the periodic payments are payable for the life of the beneficiary under the plan and either there is no guaranteed period under the contract or there is a guaranteed period that does not exceed 15 years,
(vi) the periodic payments
(A) are equal, or
(B) are not equal solely because of one or more adjustments that would, if the contract were an annuity under a retirement savings plan, be in accordance with subparagraphs 146(3)(b)(iii) to (v) or that arise because of a uniform reduction in the entitlement to the periodic payments as a consequence of a partial surrender of rights to the periodic payments, and
(vii) the contract requires that, in the event the plan must be terminated in accordance with paragraph (4)(p), any amounts that would otherwise be payable after the termination be commuted into a single payment; and
(d) a prescribed investment. (placement admissible)
(7) Subsection 146.4(1.1) of the Act is replaced by the following:
Marginal note:Specified disability savings plan
(1.1) If, in respect of a beneficiary under a registered disability savings plan, a medical doctor or a nurse practitioner licensed to practise under the laws of a province (or of the place where the beneficiary resides) certifies in writing that the beneficiary’s state of health is such that, in the professional opinion of the medical doctor or the nurse practitioner, the beneficiary is not likely to survive more than five years, the holder of the plan elects in prescribed form and provides the election and the medical certification in respect of the beneficiary to the issuer of the plan, and the issuer notifies the specified Minister of the election in a manner and format acceptable to the specified Minister, then the plan becomes a specified disability savings plan at the time the notification is received by the specified Minister.
(8) Subparagraph 146.4(4)(f)(i) of the Act is replaced by the following:
(i) the beneficiary is not a DTC-eligible individual in respect of the taxation year that includes that time, unless the contribution is a specified RDSP payment in respect of the beneficiary and, at that time, there is a valid election referred to in subsection (4.1) in respect of the beneficiary, or
(9) The description of A in paragraph 146.4(4)(l) of the Act is replaced by the following:
- A
- is the fair market value of the property held by the plan trust at the beginning of the calendar year (other than annuity contracts held by the plan trust that, at the beginning of the calendar year, are not described in paragraph (b) of the definition qualified investment in subsection (1)),
(10) Subparagraph (i) of the description of D in paragraph 146.4(4)(l) of the Act is replaced by the following:
(i) a periodic payment under an annuity contract held by the plan trust at the beginning of the calendar year (other than an annuity contract described at the beginning of the calendar year in paragraph (b) of the definition qualified investment in subsection (1)) that is paid to the plan trust in the calendar year, or
(11) Paragraph 146.4(4.1)(a) of the Act is replaced by the following:
(a) a medical doctor or a nurse practitioner licensed to practise under the laws of a province certifies in writing that the nature of the beneficiary’s condition is such that, in the professional opinion of the medical doctor or the nurse practitioner, the beneficiary is likely to become a DTC-eligible individual for a future taxation year;
(12) The portion of paragraph 146.4(5)(b) of the Act before subparagraph (i) is replaced by the following:
(b) if the trust is not otherwise taxable under paragraph (a) on its taxable income for the year and, at any time in the year, it carries on one or more businesses or 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 its taxable income for the year would be if it had no incomes or losses from sources other than those businesses and properties, and no capital gains or losses other than from dispositions of those properties, and for this purpose,
(13) Subsection 146.4(7) of the Act is replaced by the following:
Marginal note:Non-taxable portion of disability assistance payment
(7) The non-taxable portion of a disability assistance payment made at a particular time from a registered disability savings plan of a beneficiary is the lesser of the amount of the disability assistance payment and the amount determined by the formula
A × B/C + D
where
- A
- is the amount of the disability assistance payment;
- B
- is the amount, if any, by which
(a) the total of all amounts each of which is the amount of a contribution made before the particular time to any registered disability savings plan of the beneficiary
exceeds
(b) the total of all amounts each of which is the amount that would be the non-taxable portion of a disability assistance payment made before the particular time from any registered disability savings plan of the beneficiary, if the formula in this subsection were read without reference to the description of D;
- C
- is the amount by which the fair market value of the property held by the plan trust immediately before the payment exceeds the assistance holdback amount in relation to the plan; and
- D
- is the amount in respect of which a holder of the plan pays a tax under section 207.05 in respect of the plan, or another plan for which the plan was substituted by the holder, that
(14) Subsection 146.4(13) of the Act is amended by adding “and” at the end of paragraph (c) and by repealing paragraph (d).
(15) Subsections (1) to (4), (6), (9), (10) and (12) to (14) are deemed to have come into force on March 23, 2017.
(16) Subsections (5), (7) and (11) apply in respect of certifications made after September 7, 2017.
(17) Subsection (8) applies to the 2014 and subsequent taxation years.
- Date modified: