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Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.))

Full Document:  

Act current to 2019-07-01 and last amended on 2019-06-21. Previous Versions

PART XI.3Tax in Respect of Retirement Compensation Arrangements (continued)

Marginal note:Tax payable in respect of advantage

  •  (1) A custodian of a retirement compensation arrangement shall pay a tax under this Part for a calendar year if, in the year, an advantage in relation to the arrangement is extended to, or is received or receivable by, an RCA trust under the arrangement, a specified beneficiary of the arrangement or any person who does not deal at arm’s length with the specified beneficiary.

  • Marginal note:Amount of tax payable

    (2) The amount of tax payable in respect of an advantage described in subsection (1) is

    • (a) in the case of a benefit, the fair market value of the benefit;

    • (b) in the case of a loan or an indebtedness, the amount of the loan or indebtedness; and

    • (c) in the case of an RCA strip, the amount of the RCA strip.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2012, c. 31, s. 45

Marginal note:Joint liability

 If a custodian of a retirement compensation arrangement is liable to pay a tax under section 207.61 or 207.62, a specified beneficiary of the arrangement is jointly and severally, or solidarily, liable for that tax to the extent that the specified beneficiary participated in, assented to or acquiesced in the making of, the transaction or event or series of transactions or events that resulted in the liability.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2012, c. 31, s. 45

Marginal note:Waiver of tax payable

 If a person would otherwise be liable to pay a tax under this Part because of any of sections 207.61 to 207.63, the Minister may waive or cancel all or part of the liability if the Minister considers it just and equitable to do so having regard to all the circumstances, including

  • (a) whether the tax arose as a consequence of reasonable error; and

  • (b) the extent to which the transaction or event or series of transactions or events that gave rise to the tax also gave rise to another tax under this Act.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2012, c. 31, s. 45

Marginal note:Deemed distribution

 For the purposes of the definition refundable tax in subsection 207.5(1), tax paid under section 207.61 or 207.62 by a custodian of a retirement compensation arrangement out of property held in connection with the arrangement is deemed to be a distribution under the arrangement for the taxation year in which the tax is paid to the extent that the tax has not been refunded, waived or cancelled.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2012, c. 31, s. 45

Marginal note:Tax payable

  •  (1) Every custodian of a retirement compensation arrangement shall pay a tax under this Part for each taxation year of an RCA trust under the arrangement equal to the amount, if any, by which the refundable tax of the arrangement at the end of the year exceeds the refundable tax of the arrangement at the end of the immediately preceding taxation year, if any.

  • Marginal note:Refund

    (2) Where the custodian of a retirement compensation arrangement has filed a return under this Part for a taxation year within three years after the end of the year, the Minister

    • (a) may, on sending the notice of assessment for the year or a notification that no tax is payable for the year, refund without application an amount equal to the amount, if any, by which the refundable tax of the arrangement at the end of the immediately preceding year exceeds the refundable tax of the arrangement at the end of the year; and

    • (b) shall, with all due dispatch, make such a refund after sending the notice of assessment if application for it has been made in writing by the custodian within three years after the day of sending of a notice of an original assessment for the year or of a notification that no tax is payable for the year.

  • Marginal note:Payment of tax

    (3) Every custodian of a retirement compensation arrangement shall, within 90 days after the end of each taxation year of an RCA trust under the arrangement,

    • (a) file with the Minister a return for the year under this Part in prescribed form and containing prescribed information, without notice or demand therefor;

    • (b) estimate in the return the amount of tax, if any, payable by the custodian under this Part for the year; and

    • (c) pay to the Receiver General the amount of tax, if any, payable by the custodian under this Part for the year.

  • Marginal note:Provisions applicable to Part

    (4) Subsections 150(2) and 150(3), sections 152 and 158, subsections 161(1) and 161(11), sections 162 to 167 and Division J of Part I are applicable to this Part with such modifications as the circumstances require.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1987, c. 46, s. 62
  • 2010, c. 25, s. 63

PART XI.4Tax on Excess EPSP Amounts

Marginal note:Excess EPSP amount

  •  (1) In this Part, excess EPSP amount, of a specified employee for a taxation year in respect of an employer, means the amount determined by the formula

    A – (20% × B)

    where

    A
    is the portion of the total of all amounts paid by the employer of the specified employee (or by a corporation with which the employer does not deal at arm’s length) to a trust governed by an employees profit sharing plan that is allocated for the year to the specified employee; and
    B
    is the specified employee’s total income for the year from an office or employment with the employer computed without reference to paragraph 6(1)(d) and sections 7 and 8.
  • Marginal note:Tax payable

    (2) If a specified employee has an excess EPSP amount for a taxation year, the specified employee shall pay a tax for the year equal to the amount determined by the formula

    (A + B) × C

    where

    A
    is the highest individual percentage for the year;
    B
    is
    • (a) if the specified employee is resident in Quebec at the end of the year, 0%,

    • (b) if the specified employee is resident in a province other than Quebec at the end of the year, the highest percentage rate of tax, including surtaxes but not taxes that are limited to a maximum amount, imposed by the province for the year on the income of an individual who is a resident of the province, or

    • (c) in any other case, 14%; and

    C
    is the total of all excess EPSP amounts of the specified employee for the year.
  • Marginal note:Waiver or cancellation

    (3) If a specified employee would otherwise be liable to pay a tax under subsection (2), the Minister may waive or cancel all or part of the liability if the Minister considers it just and equitable to do so having regard to all the circumstances.

  • Marginal note:Return and payment of tax

    (4) Every person who is liable to pay tax under this Part for a taxation year shall

    • (a) on or before the person’s filing-due date for the year, file with the Minister a return for the year under this Part in prescribed form and containing prescribed information; and

    • (b) on or before the person’s balance-due day for the year, pay to the Receiver General the amount of tax payable under this Part by the person for the year.

  • Marginal note:Provisions applicable to this Part

    (5) Subsections 150(2) and (3), sections 152, 155 to 156.1, 158 to 160.1, 161 and 161.2 to 167 and Division J of Part I apply to this Part with any modifications that the circumstances require.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 2012, c. 31, s. 46
  • 2016, c. 7, s. 62

PART XIITax in Respect of Certain Royalties, Taxes, Lease Rentals, Etc., Paid to a Government by a Tax Exempt Person

 [Repealed, 2003, c. 28, s. 15(1)]

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • R.S., 1985, c. 1 (5th Supp.), s. 208
  • 1994, c. 7, Sch. II, s. 169
  • 1997, c. 25, s. 58
  • 2003, c. 15, s. 125, c. 28, s. 15
 
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