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

Marginal note:Additions to clause 60(l)(v)(B.2) for 2015

• 60.022 (1) In determining the amount that may be deducted because of paragraph 60(l) in computing a taxpayer’s income for the 2015 taxation year, clause 60(l)(v)(B.2) is to be read as follows:

  • (B.2) the total of all amounts each of which is

    • (I) the taxpayer’s eligible amount (within the meaning of subsection 146.3(6.11)) for the year in respect of a registered retirement income fund,

    • (II) the taxpayer’s eligible RRIF withdrawal amount (within the meaning of subsection 60.022(2)) for the year in respect of a RRIF,

    • (III) the taxpayer’s eligible variable benefit withdrawal amount (within the meaning of subsection 60.022(3)) for the year in respect of an account of the taxpayer under a money purchase provision of a registered pension plan, or

    • (IV) the taxpayer’s eligible PRPP withdrawal amount (within the meaning of subsection 60.022(4)) for the year in respect of an account of the taxpayer under a PRPP,

• Marginal note:Eligible RRIF withdrawal amount

  (2) A taxpayer’s eligible RRIF withdrawal amount for the taxation year in respect of a RRIF under which the taxpayer is the annuitant at the beginning of the taxation year is the amount determined by the formula

  A – B

  where

  A

  is the lesser of

  • (a) the total of all amounts included, because of subsection 146.3(5), in computing the taxpayer’s income for the taxation year in respect of amounts received out of or under the fund (other than an amount paid by direct transfer from the fund to another fund or to a registered retirement savings plan), and

  • (b) the amount that would be the minimum amount under the fund for the 2015 taxation year if it were determined using the prescribed factors under subsection 7308(3) or (4), as the case may be, of the Income Tax Regulations as they read on December 31, 2014; and

  B

  is the minimum amount under the fund for the taxation year.

• Marginal note:Eligible variable benefit withdrawal amount

  (3) A taxpayer’s eligible variable benefit withdrawal amount for a taxation year in respect of an account of the taxpayer under a money purchase provision of a registered pension plan is the amount determined by the formula

  A – B – C

  where

  A

  is the lesser of

  • (a) the total of all amounts each of which is the amount of a retirement benefit (other than a retirement benefit permissible under any of paragraphs 8506(1)(a) to (e) of the Income Tax Regulations) paid from the plan in the taxation year in respect of the account and included, because of paragraph 56(1)(a), in computing the taxpayer’s income for the taxation year, and

  • (b) the amount that would be the minimum amount for the account for the 2015 taxation year if it were determined using the factor designated under subsection 7308(4) of the Income Tax Regulations as they read on December 31, 2014;

  B

  is the minimum amount for the account for the taxation year; and

  C

  is the total of all contributions made by the taxpayer under the provision and designated for the purposes of subsection 8506(12) of the Income Tax Regulations.

• Marginal note:Eligible PRPP withdrawal amount

  (4) A taxpayer’s eligible PRPP withdrawal amount for a taxation year in respect of an account of the taxpayer under a PRPP is the amount determined by the formula

  A – B

  where

  A

  is the lesser of

  • (a) the total of all amounts each of which is the amount of a distribution made from the account in the taxation year and included, because of subsection 147.5(13), in computing the taxpayer’s income for the taxation year, and

  • (b) the amount that would be the minimum amount for the account for the 2015 taxation year if it were determined using the factor designated under subsection 7308(4) of the Income Tax Regulations as they read on December 31, 2014, and

  B

  is the minimum amount for the account for the taxation year.

• Marginal note:Expressions used in this section

  (5) For the purposes of this section,

  • (a) money purchase provision has the same meaning as in subsection 147.1(1);

  • (b) retirement benefits has the same meaning as in subsection 8500(1) of the Income Tax Regulations;

  • (c) the minimum amount for an account of a taxpayer under a money purchase provision of a registered pension plan is the amount determined under subsection 8506(5) of the Income Tax Regulations; and

  • (d) the minimum amount for an account of a taxpayer under a PRPP is the amount that would be the minimum amount for the calendar year under subsection 8506(5) of the Income Tax Regulations if the taxpayer’s account were an account under a money purchase provision of a registered pension plan.

Marginal note:Definitions

• 60.03 (1) The following definitions apply in this section.

  eligible pension income

  eligible pension income, of an individual for a taxation year, means the total of

  • (a) the eligible pension income (as defined in subsection 118(7)) of the individual for the year,

  • (b) if the individual has attained the age of 65 years before the end of the year, the lesser of

    • (i) the total of all amounts each of which is a payment made in the year to the individual

      • (A) out of or under a retirement compensation arrangement that provides benefits that supplement the benefits provided under a registered pension plan (other than an individual pension plan for the purposes of Part LXXXIII of the Income Tax Regulations), and

      • (B) in respect of a life annuity that is attributable to periods of employment for which benefits are also provided to the individual under the registered pension plan,

    • (ii) the amount, if any, by which the defined benefit limit (as defined in subsection 8500(1) of the Income Tax Regulations) for the year multiplied by 35 exceeds the amount determined under paragraph (a), and

  • (c) the lesser of

    • (i) the total of all amounts received by the individual in the year on account of

      • (A) a retirement income security benefit payable to the individual under Part 2 of the Veterans Well-being Act, or

      • (B) an income replacement benefit payable to the individual under Part 2 of the Veterans Well-being Act, if the amount is determined under subsection 19.1(1), paragraph 23(1)(b) or subsection 26.1(1) of that Act (as modified, where applicable, under Part 5 of that Act), and

    • (ii) the amount, if any, by which the defined benefit limit (as defined in subsection 8500(1) of the Income Tax Regulations) for the year multiplied by 35 exceeds the total of the amounts determined under paragraphs (a) and (b). (revenu de pension déterminé)

  joint election

  joint election in respect of a pensioner and a pension transferee for a taxation year means an election made jointly in prescribed form by the pensioner and the pension transferee and filed with the Minister with both the pensioner’s and the pension transferee’s returns of income for the taxation year in respect of which the election is made, on or before their respective filing-due dates for the taxation year. (choix conjoint)

  pensioner

  pensioner for a taxation year means an individual who

  • (a) receives eligible pension income in the taxation year; and

  • (b) is resident in Canada,

    • (i) if the individual dies in the taxation year, at the time that is immediately before the individual’s death, or

    • (ii) in any other case, at the end of the calendar year in which the taxation year ends. (pensionné)

  pension income

  pension income has the meaning assigned by section 118. (revenu de pension)

  pension transferee

  pension transferee for a taxation year means an individual who

  • (a) is resident in Canada,

    • (i) if the individual dies in the taxation year, at the time that is immediately before the individual’s death, or

    • (ii) in any other case, at the end of the calendar year in which the taxation year ends; and

  • (b) at any time in the taxation year is married to, or in a common-law partnership with, a pensioner and is not, by reason of the breakdown of their marriage or common-law partnership, living separate and apart from the pensioner at the end of the taxation year and for a period of at least 90 days commencing in the taxation year. (cessionnaire)

  qualified pension income

  qualified pension income has the meaning assigned by section 118. (revenu de pension admissible)

  split-pension amount

  split-pension amount for a taxation year is the amount elected by a pensioner and a pension transferee in a joint election for the taxation year not exceeding the amount determined by the formula

  0.5A × B/C

  where

  A

  is the eligible pension income of the pensioner for the taxation year;

  B

  is the number of months in the pensioner’s taxation year at any time during which the pensioner was married to, or was in a common-law partnership with, the pension transferee; and

  C

  is the number of months in the pensioner’s taxation year. (montant de pension fractionné)

• Marginal note:Effect of pension income split

  (2) For the purpose of subsection 118(3), if a pensioner and a pension transferee have made a joint election in a taxation year,

  • (a) the pensioner is deemed not to have received the portion of the pensioner’s pension income, qualified pension income or an amount described in subparagraph (c)(i) of the definition eligible pension income in subsection (1), as the case may be, for the taxation year that is equal to the amount of the pensioner’s split-pension amount for that taxation year; and

  • (b) the pension transferee is deemed to have received the split-pension amount

    • (i) as pension income, to the extent that the split-pension amount was pension income to the pensioner,

    • (ii) as qualified pension income, to the extent that the split-pension amount was qualified pension income to the pensioner, and

    • (iii) as an amount described in subparagraph (c)(i) of the definition eligible pension income in subsection (1) to the extent that the split-pension amount was received by the pensioner as an amount described in subparagraph (c)(i) of that definition, if the pension transferee has attained the age of 65 years before the end of the taxation year.

• Marginal note:Limitation

  (3) A pensioner may file only one joint election for a particular taxation year.

• Marginal note:False declaration

  (4) A joint election is invalid if the Minister establishes that a pensioner or a pension transferee has knowingly or under circumstances amounting to gross negligence made a false declaration in the joint election.

Marginal note:Support

• 60.1 (1) For the purposes of paragraph 60(b) and subsection 118(5), where an order or agreement, or any variation thereof, provides for the payment of an amount by a taxpayer to a person or for the benefit of the person, children in the person’s custody or both the person and those children, the amount or any part thereof

  • (a) when payable, is deemed to be payable to and receivable by that person; and

  • (b) when paid, is deemed to have been paid to and received by that person.

• Marginal note:Agreement

  (2) For the purposes of section 60, this section and subsection 118(5), the amount determined by the formula

  A - B

  where

  A

  is the total of all amounts each of which is an amount (other than an amount that is otherwise a support amount) that became payable by a taxpayer in a taxation year, under an order of a competent tribunal or under a written agreement, in respect of an expense (other than an expenditure in respect of a self-contained domestic establishment in which the taxpayer resides or an expenditure for the acquisition of tangible property, or for civil law corporeal property, that is not an expenditure on account of a medical or education expense or in respect of the acquisition, improvement or maintenance of a self-contained domestic establishment in which the person described in paragraph (a) or (b) resides) incurred in the year or the preceding taxation year for the maintenance of a person, children in the person’s custody or both the person and those children, if the person is

  • (a) the taxpayer’s spouse or common-law partner or former spouse or common-law partner, or

  • (b) where the amount became payable under an order made by a competent tribunal in accordance with the laws of a province, an individual who is a parent of a child of whom the taxpayer is a legal parent,

  and

  B

  is the amount, if any, by which

  • (a) the total of all amounts each of which is an amount included in the total determined for A in respect of the acquisition or improvement of a self-contained domestic establishment in which that person resides, including any payment of principal or interest in respect of a loan made or indebtedness incurred to finance, in any manner whatever, such acquisition or improvement

  exceeds

  • (b) the total of all amounts each of which is an amount equal to 1/5 of the original principal amount of a loan or indebtedness described in paragraph (a),

  is, where the order or written agreement, as the case may be, provides that this subsection and subsection 56.1(2) shall apply to any amount paid or payable thereunder, deemed to be an amount payable by the taxpayer to that person and receivable by that person as an allowance on a periodic basis, and that person is deemed to have discretion as to the use of that amount.

• Marginal note:Prior payments

  (3) For the purposes of this section and section 60, where a written agreement or order of a competent tribunal made at any time in a taxation year provides that an amount paid before that time and in the year or the preceding taxation year is to be considered to have been paid and received thereunder,

  • (a) the amount is deemed to have been paid thereunder; and

  • (b) the agreement or order is deemed, except for the purpose of this subsection, to have been made on the day on which the first such amount was paid, except that, where the agreement or order is made after April 1997 and varies a child support amount payable to the recipient from the last such amount paid to the recipient before May 1997, each varied amount of child support paid under the agreement or order is deemed to have been payable under an agreement or order the commencement day of which is the day on which the first payment of the varied amount is required to be made.

• Marginal note:Definitions

  (4) The definitions in subsection 56.1(4) apply in this section and section 60.