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

Marginal note:Tuition tax credit transferred

118.81 In this Subdivision, the tuition tax credit transferred for a taxation year by a person to an individual is the lesser of

• (a) the amount determined by the formula

  A - B

  where

  A

  is the lesser of

  • (i) the total of all amounts that may be deducted under section 118.5 in computing the person’s tax payable under this Part for the year, and

  • (ii) the amount determined by the formula

    C × D

    where

    C

    is the appropriate percentage for the taxation year, and

    D

    is $5,000.

  B

  is the amount that would be the person’s tax payable under this Part for the year if no amount were deductible under this Division (other than an amount deductible under any of sections 118 to 118.07, 118.3, 118.61 and 118.7), and

• (b) the amount for the year that the person designates in writing for the purpose of section 118.8 or 118.9.

Marginal note:Transfer to parent or grandparent

118.9 If for a taxation year a parent or grandparent of an individual (other than an individual in respect of whom the individual’s spouse or common-law partner deducts an amount under section 118 or 118.8 for the year) is the only person designated in writing by the individual for the year for the purpose of this section, there may be deducted in computing the tax payable under this Part for the year by the parent or grandparent, as the case may be, the tuition tax credit transferred for the year by the individual to the parent or grandparent, as the case may be.

Marginal note:Part-year residents

118.91 Notwithstanding sections 118 to 118.9, where an individual is resident in Canada throughout part of a taxation year and throughout another part of the year is non-resident, for the purpose of computing the individual’s tax payable under this Part for the year,

• (a) the amount deductible for the year under each such provision in respect of the part of the year that is not included in the period or periods referred to in paragraph 118.91(b) shall be computed as though such part were the whole taxation year; and

• (b) the individual shall be allowed only

  • (i) such of the deductions permitted under subsections 118(3) and (10) and sections 118.01 to 118.2, 118.5, 118.62 and 118.7 as can reasonably be considered wholly applicable to the period or periods in the year throughout which the individual is resident in Canada, computed as though that period or those periods were the whole taxation year, and

  • (ii) such part of the deductions permitted under sections 118 (other than subsections 118(3) and (10)), 118.3, 118.8 and 118.9 as can reasonably be considered applicable to the period or periods in the year throughout which the individual is resident in Canada, computed as though that period or those periods were the whole taxation year,

except that the amount deductible for the year by the individual under each such provision shall not exceed the amount that would have been deductible under that provision had the individual been resident in Canada throughout the year.

Marginal note:Ordering of credits

118.92 In computing an individual’s tax payable under this Part, the following provisions shall be applied in the following order: subsections 118(1) and (2), section 118.7, subsections 118(3) and (10) and sections 118.01, 118.02, 118.04, 118.041, 118.05, 118.06, 118.07, 118.3, 118.61, 118.5, 118.9, 118.8, 118.2, 118.1, 118.62 and 121.

Marginal note:Credits in separate returns

118.93 If a separate return of income with respect to a taxpayer is filed under subsection 70(2), 104(23) or 150(4) for a particular period and another return of income under this Part with respect to the taxpayer is filed for a period ending in the calendar year in which the particular period ends, for the purpose of computing the tax payable under this Part by the taxpayer in those returns, the total of all deductions claimed in all those returns under any of subsections 118(3) and (10) and sections 118.01 to 118.7 and 118.9 shall not exceed the total that could be deducted under those provisions for the year with respect to the taxpayer if no separate returns were filed under any of subsections 70(2), 104(23) and 150(4).

Marginal note:Tax payable by non-residents (credits restricted)

118.94 Sections 118 to 118.07 and 118.2, subsections 118.3(2) and (3) and sections 118.8 and 118.9 do not apply for the purpose of computing the tax payable under this Part for a taxation year by an individual who at no time in the year is resident in Canada unless all or substantially all the individual’s income for the year is included in computing the individual’s taxable income earned in Canada for the year.

Marginal note:Credits in year of bankruptcy

118.95 Notwithstanding sections 118 to 118.9, for the purpose of computing an individual’s tax payable under this Part for a taxation year that ends in a calendar year in which the individual becomes bankrupt, the individual shall be allowed only

• (a) such of the deductions as the individual is entitled to under any of subsections 118(3) and (10) and sections 118.01 to 118.2, 118.5, 118.62 and 118.7, as can reasonably be considered wholly applicable to the taxation year, and

• (b) such part of the deductions as the individual is entitled to under any of sections 118 (other than subsections 118(3) and (10)), 118.3, 118.8 and 118.9 as can reasonably be considered applicable to the taxation year,

except that the total of the amounts so deductible for all taxation years of the individual in the calendar year under any of those provisions shall not exceed the amount that would have been deductible under that provision in respect of the calendar year if the individual had not become bankrupt.

Marginal note:Former resident — credit for tax paid

119 If at any particular time an individual was deemed by subsection 128.1(4) to have disposed of a capital property that was a taxable Canadian property of the individual throughout the period that began at the particular time and that ends at the first time, after the particular time, at which the individual disposes of the property, there may be deducted in computing the individual’s tax payable under this Part for the taxation year that includes the particular time the lesser of

• (a) that proportion of the individual’s tax for the year otherwise payable under this Part (within the meaning assigned by paragraph (a) of the definition tax for the year otherwise payable under this Part in subsection 126(7)) that

  • (i) the individual’s taxable capital gain from the disposition of the property at the particular time

  is of

  • (ii) the amount determined under paragraph 114(a) in respect of the individual for the year, and

• (b) that proportion of the individual’s tax payable under Part XIII in respect of dividends received during the period by the individual in respect of the property and amounts deemed under Part XIII to have been paid during the period to the individual as dividends from corporations resident in Canada, to the extent that the amounts can reasonably be considered to relate to the property, that

  • (i) the amount by which the individual’s loss from the disposition of the property at the end of the period is reduced by subsection 40(3.7)

  is of

  • (ii) the total amount of those dividends.

119.1 [Repealed, 2016, c. 7, s. 25]

Marginal note:Income not earned in a province

• 120 (1) There shall be added to the tax otherwise payable under this Part by an individual for a taxation year the amount that bears the same relation to 48% of the tax otherwise payable under this Part by the individual for the year that

  • (a) the individual’s income for the year, other than the individual’s income earned in the year in a province,

  bears to

  • (b) the individual’s income for the year.

• Marginal note:Amount deemed paid in prescribed manner

  (2) Each individual is deemed to have paid, in prescribed manner and on prescribed dates, on account of the individual’s tax under this Part for a taxation year an amount that bears the same relation to 3% of the tax otherwise payable under this Part by the individual for the year that

  • (a) the individual’s income earned in the year in a province that, on January 1, 1973, was a province providing schooling allowances within the meaning of the Youth Allowances Act, chapter Y-1 of the Revised Statutes of Canada, 1970,

  bears to

  • (b) the individual’s income for the year.

• (2.1) [Repealed, 2001, c. 17, s. 103]

• Marginal note:Amount deemed paid

  (2.2) An individual is deemed to have paid on the last day of a taxation year, on account of the individual’s tax under this Part for the year, an amount equal to the individual’s income tax payable for the year to an Aboriginal government pursuant to a law of that government made in accordance with a tax sharing agreement between that government and the Government of Canada.

• Definition of the individual’s income for the year

  (3) For the purpose of this section, the individual’s income for the year means

  • (a) if section 114 applies to the individual in respect of the year, the amount determined under paragraph 114(a) in respect of the individual for the year;

  • (b) if the individual was non-resident throughout the year, the individual’s taxable income earned in Canada for the year determined without reference to paragraphs 115(1)(d) to (f);

  • (c) in the case of an individual who is a specified individual in relation to the year, the individual’s income for the year computed without reference to paragraph 20(1)(ww); and

  • (d) in the case of a SIFT trust, the amount, if any, by which its income for the year determined without reference to this paragraph exceeds its taxable SIFT trust distributions (as defined in subsection 122(3)) for the year.

• Marginal note:Definitions

  (4) In this section,

  income earned in the year in a province

  income earned in the year in a province means amounts determined under rules prescribed for the purpose of regulations made on the recommendation of the Minister of Finance; (revenu gagné au cours de l’année dans une province)

  tax otherwise payable under this Part

  tax otherwise payable under this Part by an individual for a taxation year means the total of

  • (a) the greater of

    • (i) the individual”s minimum amount for the year determined under section 127.51, and

    • (ii) the amount that, but for this section, would be the individual’s tax payable under this Part for the year if this Part were read without reference to

      • (A) subsection 117(2.1), section 119, subsection 120.4(2) and sections 126, 127, 127.4 and 127.41, and

      • (B) where the individual is a specified individual in relation to the year, section 121 in its application to dividends included in computing the individual’s split income for the year, and

  • (b) where the individual is a specified individual in relation to the year, the amount, if any, by which

    • (i) the highest individual percentage for the year multiplied by the individual’s split income for the year

    exceeds

    • (ii) the total of all amounts each of which is an amount that may be deducted under section 121 and that can reasonably be considered to be in respect of a dividend included in computing the individual’s split income for the year. (impôt qu’il est par ailleurs tenu de payer en vertu de la présente partie ou impôt payable par ailleurs en vertu de la présente partie)

120.1 [Repealed, 2000, c. 19, s. 28]