Income Tax Act

Marginal note:Definitions

• 180.2 (1) The definitions in this subsection apply in this Part.

  adjusted income

  adjusted income of an individual for a taxation year means the amount that would be the individual’s income under Part I for the year if in computing that income no amount were

  • (a) included

    • (i) under paragraph 56(1)(q.1) or subsection 56(6),

    • (ii) in respect of a gain from a disposition of property to which section 79 applies, or

    • (iii) in respect of a gain described in subsection 40(3.21), or

  • (b) deductible under paragraph 20(1)(ww) or 60(w), (y) or (z). (revenu modifié)

  base taxation year

  base taxation year in relation to a month, means

  • (a) where the month is any of the first 6 months of a calendar year, the taxation year that ended on December 31 of the second preceding calendar year, and

  • (b) where the month is any of the last 6 months of a calendar year, the taxation year that ended on December 31 of the preceding calendar year. (année de base)

  return of income

  return of income in respect of an individual for a taxation year means

  • (a) where the individual was resident in Canada throughout the year, the individual’s return of income (other than a return of income filed under subsection 70(2) or 104(23), paragraph 128(2)(e) or subsection 150(4)) that is filed or required to be filed under Part I for the year, and

  • (b) in any other case, a prescribed form containing prescribed information. (déclaration de revenu)

• Marginal note:Tax payable

  (2) Every individual shall pay a tax under this Part for each taxation year equal to the amount determined by the formula

  A(1 - B)

  where

  A

  is the lesser of

  • (a) the amount, if any, by which

    • (i) the total of all amounts each of which is the amount of any pension, supplement or spouse’s or commmon-law partner’s allowance under the Old Age Security Act included in computing the individual’s income under Part I for the year

    exceeds

    • (ii) the amount of any deduction allowed under subparagraph 60(n)(i) in computing the individual’s income under Part I for the year, and

  • (b) 15% of the amount, if any, by which the individual’s adjusted income for the year exceeds $50,000; and

  B

  is the rate of tax payable by the individual under Part XIII on amounts described in paragraph (a) of the description of A.

• Marginal note:Withholding

  (3) Where at any time Her Majesty pays an amount described in paragraph (a) of the description of A in subsection 180.2(2) in respect of a month to an individual, there shall be deducted or withheld from that amount on account of the individual’s tax payable under this Part for the year the amount determined under subsection 180.2(4) in respect of that amount.

• Marginal note:Determination of amount to be withheld

  (4) The amount determined in respect of a particular amount described in subsection 180.2(3) is

  • (a) where the individual has filed a return of income for the base taxation year in relation to the month in which the particular amount is paid, the lesser of

    • (i) the amount by which the particular amount exceeds the amount of tax payable under Part XIII by the individual on the particular amount, and

    • (ii) the amount determined by the formula

      (0.0125A - $665)(1 - B)

      where

      A

      is the individual’s adjusted income for the base taxation year, and

      B

      is the rate of tax payable under Part XIII by the individual on the particular amount;

  • (b) where the individual has not filed a return of income for the base taxation year in relation to the month and

    • (i) the Minister has demanded under subsection 150(2) that the individual file the return, or

    • (ii) the individual was non-resident at any time in the base taxation year,

    the amount by which the particular amount exceeds the amount of tax payable under Part XIII by the individual on the particular amount; and

  • (c) in any other case, nil.

• Marginal note:Return

  (5) Every individual liable to pay tax under this Part for a taxation year shall

  • (a) file with the Minister, without notice or demand therefor,

    • (i) where the individual is resident in Canada throughout the taxation year, a return for the year under this Part in prescribed form and containing prescribed information on or before the individual’s filing-due date for the year, and

    • (ii) in any other case, a return of income for the year on or before the individual’s balance-due day for the year; and

  • (b) pay the individual’s tax payable under this Part for the year on or before the individual’s balance-due day for the year.

• Marginal note:Provisions applicable to this Part

  (6) Subsection 150(3), sections 150.1, 151 and 152, subsections 153(1.1), 153(1.2) and 153(3), sections 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.