Income Tax Act

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.