Income Tax Act

Marginal note:Election — special tax and relief for deferral of stock option benefits

• 180.01 (1) A taxpayer may make an election in prescribed form to have subsection (2) apply for a taxation year in respect of particular securities if

  • (a) the taxpayer elected to have subsection 7(8) apply, as that subsection applied before 4:00 p.m. Eastern Standard Time, March 4, 2010, in respect of the particular securities; and

  • (b) the taxpayer has, in the year and before 2015, disposed of the particular securities; and

  • (c) the election under this subsection is filed

    • (i) if the taxpayer has disposed of the particular securities before 2010, on or before the taxpayer’s filing-due date for 2010, and

    • (ii) in any other case, on or before the taxpayer’s filing-due date for the year of disposition of the particular securities.

• Marginal note:Effect of election

  (2) If a taxpayer makes an election under subsection (1) for a taxation year in respect of particular securities, the following rules apply:

  • (a) paragraph 110(1)(d) shall be read without reference to the phrase “1/2 of” in respect of the amount of the benefit deemed by subsection 7(1) to have been received by the taxpayer in the year in respect of the particular securities;

  • (b) the taxpayer is deemed to have realized a capital gain for the year equal to the lesser of

    • (i) the amount that is deductible by the taxpayer under paragraph 110(1)(d), as modified by paragraph (a), and

    • (ii) the taxpayer’s capital loss in respect of the disposition of the particular securities;

  • (c) the taxpayer is liable to pay a tax for the year equal to

    • (i) in the case of a taxpayer resident in the Province of Quebec at the end of the year, 2/3 of the taxpayer’s proceeds of disposition (as defined in section 54, but determined without reference to subsection 73(1)) of the particular securities, and

    • (ii) in any other case, the taxpayer’s proceeds of disposition (as defined in section 54, but determined without reference to subsection 73(1)) of the particular securities;

  • (d) to the extent that the taxation year is outside the normal reassessment period (as defined in subsection 152(3.1)), the election is deemed to be an application for reassessment under subsection 152(4.2);

  • (e) notwithstanding subsection 152(4) and as the circumstances require, the Minister shall re-determine the taxpayer’s net capital loss (as defined in subsection 111(8)) for the taxation year and reassess any taxation year in which an amount has been deducted under paragraph 111(1)(b).

  • (f) subparagraph 127.52(1)(h)(ii) is to be read as “the amount deducted under paragraph 110(1)(d)” for the year in respect of the particular securities; and

  • (g) notwithstanding subsection 152(4) and as the circumstances require, the Minister shall re-determine the taxpayer’s additional tax under subsection 120.2(3) for the taxation year and reassess any taxation year in which an amount has been deducted under subsection 120.2(1).

• Marginal note:Non-application for employment insurance purposes

  (3) An amount included under subsection (2)(b) in computing a person’s income under Part I of this Act for a taxation year shall not be included in determining the income of the person for the year under Part VII of the Employment Insurance Act.

• Marginal note:Provisions applicable to this Part

  (4) Subsection 150(3), sections 150.1 to 152, 155 to 156.1 and 158 to 167 and Division J of Part I apply to this Part with any modifications that the circumstances require.