Bill C-28

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	(a) on or before its filing-due date for a taxation year, file with the Minister a return for the year under this Part in prescribed form and containing prescribed information, without notice or demand therefor;
	(b) estimate in the return the amount of tax and penalties, if any, payable under this Part by it for the year; and
	(c) within 90 days after the end of the year, pay to the Receiver General the amount of tax and penalties, if any, payable under this Part by it for the year.
Return and payment of tax for other LSVCCs	(2) Where tax is payable under this Part for a taxation year by a corporation because of subsection 204.82(5) or 204.85(2), the corporation shall
	(a) on or before its filing-due date for the year, file with the Minister a return for the year under this Part in prescribed form and containing prescribed information, without notice or demand therefor;
	(b) estimate in the return the amount of tax payable under this Part by it for the year; and
	(c) within 90 days after the end of the year, pay to the Receiver General the amount of tax payable under this Part by it for the year.
	(2) Subsection (1) applies to taxation years that end after February 18, 1997.
	57. (1) Subsection 204.9(1) of the Act is replaced by the following:
Definitions	204.9 (1) The definitions in this subsection apply in this Part.
``excess amount'' « excédent »	``excess amount'' for a year at any time in respect of an individual means the amount, if any, by which the total of all contributions made after February 20, 1990 in the year and before that time into all registered education savings plans by or on behalf of all subscribers in respect of the individual exceeds the lesser of
	(a) the RESP annual limit for the year, and
	(b) the amount, if any, by which the RESP lifetime limit for the year exceeds the total of all contributions made into registered education savings plans by or on behalf of all subscribers in respect of the individual in all preceding years.
``RESP lifetime limit'' « plafond cumulatif de REEE »	``RESP lifetime limit'' for a year means,
	(a) for 1990 to 1995, $31,500; and
	(b) for 1996 and subsequent years, $42,000.
``subscriber's gross cumulative excess'' « excédent cumulatif brut du souscrip- teur »	``subscriber's gross cumulative excess'' at any time in respect of an individual means the total of all amounts each of which is the subscriber's share of the excess amount for a relevant year at that time in respect of the individual and, for the purpose of this definition, a relevant year at any time is a year that began before that time.
``subscriber's share of the excess amount'' « part du souscripteur sur l'excédent »	``subscriber's share of the excess amount'' for a year at any time in respect of an individual means the amount determined by the formula
	(A/B) x C
	where
	A is the total of all contributions made after February 20, 1990, in the year and before that time into all registered education savings plans by or on behalf of the subscriber in respect of the individual;
	B is the total of all contributions made after February 20, 1990, in the year and before that time into all registered education savings plans by or on behalf of all subscribers in respect of the individual; and
	C is the excess amount for the year at that time in respect of the individual.
	(2) Subsection 204.9(4) of the Act is replaced by the following:
New beneficiary	(4) For the purposes of this Part, if at any particular time an individual (in this subsection referred to as the ``new beneficiary'') becomes a beneficiary under a registered education savings plan in place of another individual (in this subsection referred to as the ``former beneficiary'') who ceased at or before the particular time to be a beneficiary under the plan,
	(a) except as provided by paragraph (b), each contribution made at an earlier time by or on behalf of a subscriber into the plan in respect of the former beneficiary is deemed also to have been made at that earlier time in respect of the new beneficiary;
	(b) except for the purpose of applying this subsection to a replacement of a beneficiary after the particular time, applying subsection (5) to a distribution after the particular time and applying subsection 204.91(3) to events after the particular time, paragraph (a) does not apply as a consequence of the replacement at the particular time of the former beneficiary where the new beneficiary had not attained 21 years of age at the particular time and a parent of the new beneficiary was a parent of the former beneficiary; and
	(c) except where paragraph (b) applies, each contribution made by or on behalf of a subscriber under the plan in respect of the former beneficiary under the plan is, without affecting the determination of the amount withdrawn from the plan in respect of the new beneficiary, deemed to have been withdrawn at the particular time from the plan to the extent that it was not withdrawn before the particular time.
Transfers between plans	(5) For the purposes of this Part, if property held by a trust governed by a registered education savings plan (in this subsection referred to as the ``transferor plan'') is distributed at a particular time to a trust governed by another registered education savings plan (in this subsection referred to as the ``transferee plan''),
	(a) except as provided by paragraphs (b) and (c), the amount of the distribution is deemed not to have been contributed into the transferee plan;
	(b) subject to paragraph (c), each contribution made at any earlier time by or on behalf of a subscriber into the transferor plan in respect of a beneficiary under the transferor plan is deemed also to have been made at that earlier time by the subscriber in respect of each beneficiary under the transferee plan;
	(c) except for the purpose of applying this subsection to a distribution after the particular time, applying subsection (4) to a replacement of a beneficiary after the particular time and applying subsection 204.91(3) to events after the particular time, paragraph (b) does not apply as a consequence of the distribution where
	(i) any beneficiary under the transferee plan was, immediately before the particular time, a beneficiary under the transferor plan, or
	(ii) a beneficiary under the transferee plan had not attained 21 years of age at the particular time and a parent of the beneficiary was a parent of an individual who was, immediately before the particular time, a beneficiary under the transferor plan;
	(d) where subparagraph (c)(i) or (ii) applies in respect of the distribution, the amount of the distribution is deemed not to have been withdrawn from the transferor plan; and
	(e) each subscriber under the transferor plan is deemed to be a subscriber under the transferee plan.
	(3) Subsection (1) applies for the purpose of determining tax under Part X.4 of the Act for months that are after 1996.
	(4) Subsection (2) applies to replacements of beneficiaries and distributions that occur after 1996.
	58. (1) Section 204.91 of the Act is replaced by the following:
Tax payable by subscribers	204.91 (1) Every subscriber under a registered education savings plan shall pay a tax under this Part in respect of each month equal to 1% of the amount, if any, by which
	(a) the total of all amounts each of which is the subscriber's gross cumulative excess at the end of the month in respect of an individual
	exceeds
	(b) the total of all amounts each of which is the portion of such an excess that has been withdrawn from a registered education savings plan before the end of the month.
Waiver of tax	(2) If a subscriber under a registered education savings plan would, but for this subsection, be required to pay a tax in respect of a month under subsection (1) in respect of an individual, the Minister may waive or cancel all or part of the tax where it is just and equitable to do so having regard to all the circumstances, including
	(a) whether the tax arose as a consequence of reasonable error;
	(b) whether, as a consequence of one or more transactions or events to which subsection 204.9(4) or (5) applies, the tax is excessive; and
	(c) the extent to which further contributions could be made into registered education savings plans in respect of the individual before the end of the month without causing additional tax to be payable under this Part if this Part were read without reference to this subsection.
Marriage breakdown	(3) If at any time an individual (in this subsection referred to as the ``former subscriber'') ceases to be a subscriber under a registered education savings plan as a consequence of the settlement of rights arising out of, or on the breakdown of, the marriage of the former subscriber and another individual (in this subsection referred to as the ``current subscriber'') who is a subscriber under the plan immediately after that time, for the purpose of determining tax payable under this Part in respect of a month that ends after that time, each contribution made before that time into the plan by or on behalf of the former subscriber is deemed to have been made into the plan by the current subscriber and not by or on behalf of the former subscriber.
Deceased subscribers	(4) For the purpose of applying this section where a subscriber has died, the subscriber's estate is deemed to be the same person as, and a continuation of, the subscriber for each month that ends after the death.
	(2) Subsection 204.91(1) of the Act, as enacted by subsection (1), applies for the purpose of determining tax under Part X.4 of the Act for months that are after 1996.
	(3) Subsection 204.91(2) of the Act, as enacted by subsection (1), applies for the purpose of determining tax under Part X.4 of the Act for months that are after January 1990.
	(4) Subsections 204.91(3) and (4) of the Act, as enacted by subsection (1), apply for the purpose of determining tax under Part X.4 of the Act for months that are after 1997.
	59. (1) The Act is amended by adding the following after Part X.4:
	PART X.5
	PAYMENTS UNDER REGISTERED EDUCATION SAVINGS PLANS
Definitions	204.94 (1) The definitions in subsection 146.1(1) apply for the purposes of this Part, except that the definition ``subscriber'' in that subsection shall be read without reference to paragraph (c).
Charging provision	(2) Every person shall pay a tax under this Part for each taxation year equal to the amount determined by the formula
	0.2 x (A + B - C)
	where
	A is the total of all amounts each of which is an accumulated income payment made at any time that is
	(a) either
	(i) under a registered education savings plan under which the person is a subscriber at that time, or
	(ii) under a registered education savings plan under which there is no subscriber at that time, where the person has been a spouse of an individual who was a subscriber under the plan, and
	(b) included in computing the person's income under Part I for the year;
	B is the total of all amounts each of which is an accumulated income payment that is
	(a) not included in the value of A in respect of the person for the year, and
	(b) included in computing the person's income under Part I for the year; and
	C is the lesser of
	(a) the lesser of the value of A in respect of the person for the year and the total of all amounts each of which is an amount deducted under subsection 146(5) or (5.1) in computing the person's income under Part I for the year, and
	(b) the amount, if any, by which $40,000 exceeds the total of all amounts each of which is an amount determined under paragraph (a) in respect of the person for a preceding taxation year.
Return and payment of tax	(3) Every person who is liable to pay tax under this Part for a taxation year shall, on or before the person's filing-due date for the year,
	(a) file with the Minister a return for the year under this Part in prescribed form and containing prescribed information, without notice or demand therefor;
	(b) estimate in the return the amount of tax payable under this Part by the person for the year; and
	(c) pay to the Receiver General the amount of tax payable under this Part by the person for the year.
Administra- tive rules	(4) Subsections 150(2) and (3), sections 152, 155 to 156.1 and 158 to 167 and Division J of Part I apply with any modifications that the circumstances require.
	(2) Subsection (1) applies to the 1998 and subsequent taxation years.
	60. (1) The heading ``TAX ON MINING RECLAMATION TRUSTS'' before section 211.6 of the Act is replaced by the following:

Bill C-28

PART X.5

PAYMENTS UNDER REGISTERED EDUCATION SAVINGS PLANS