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Bill C-25

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    (l.9) as remuneration for therapy provided to the patient because of the patient's severe and prolonged impairment, if

      (i) because of the patient's impairment, an amount may be deducted under section 118.3 in computing a taxpayer's tax payable under this Part for the taxation year in which the remuneration is paid,

      (ii) the therapy is prescribed by, and administered under the general supervision of,

        (A) a medical doctor or a psychologist, in the case of mental impairment, and

        (B) a medical doctor or an occupational therapist, in the case of a physical impairment,

      (iii) at the time the remuneration is paid, the payee is neither the individual's spouse nor an individual who is under 18 years of age, and

      (iv) each receipt filed with the Minister to prove payment of the remuneration was issued by the payee and contains, where the payee is an individual, that individual's Social Insurance Number;

    (l.91) as remuneration for tutoring services that are rendered to, and are supplementary to the primary education of, the patient who

      (i) has a learning disability or a mental impairment, and

      (ii) has been certified in writing by a medical practitioner to be a person who, because of that disability or impairment, requires those services,

    if the payment is made to a person ordinarily engaged in the business of providing such services to individuals who are not related to the payee.

(5) Subsections (1) to (4) apply to the 1999 and subsequent taxation years except that, in its application to the 1999 taxation year, paragraph (b) of the description of D in subsection 118.2(1) of the Act, as enacted by subsection (1), shall be read as follows:

      (b) $7,044.

26. (1) Paragraph (a) of the description of C in section 118.8 of the Act is replaced by the following:

      (a) the amount that would be the spouse's tax payable under this Part for the year if no amount were deductible under this Division (other than an amount deductible under subsection 118(1) because of paragraph (c) of the description of B in that subsection or under section 118.61 or 118.7)

(2) Subsection (1) applies to the 2000 and subsequent taxation years.

27. (1) Section 120 of the Act is amended by adding the following after subsection (2.1):

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.

(2) The portion of subsection 120(3) of the Act before paragraph (a) is replaced by the following:

Definition of ``the individual's income for the year''

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

(3) Subsection 120(3) of the Act is amended by striking out the word ``and'' at the end of paragraph (a), by adding the word ``and'' at the end of paragraph (b) and by adding the following after paragraph (b):

    (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).

(4) The definition ``tax otherwise payable under this Part'' in subsection 120(4) of the Act is replaced by the following:

``tax otherwise payable under this Part''
« 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 »

``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 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) 29% of 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.

(5) Subsection (1) applies to the 1999 and subsequent taxation years.

(6) Subsections (2) to (4) apply to the 2000 and subsequent taxation years.

28. (1) Section 120.1 of the Act is repealed.

(2) Subsection (1) applies to the 1998 and subsequent taxation years.

29. (1) The portion of subsection 120.2(1) of the Act before paragraph (a) is replaced by the following:

Minimum tax carry-over

120.2 (1) There may be deducted from the amount that, but for this section, section 120 and subsection 120.4(2), would be an individual's tax payable under this Part for a particular taxation year such amount as the individual claims not exceeding the lesser of

(2) Subparagraph 120.2(1)(b)(i) of the Act is replaced by the following:

      (i) the amount that, but for this section, section 120 and subsection 120.4(2), would be the individual's tax payable under this Part for the particular year if the individual were not entitled to any deduction under any of sections 126, 127 and 127.4

(3) Paragraph 120.2(3)(b) of the Act is replaced by the following:

    (b) the amount that, but for section 120 and subsection 120.4(2), would be the individual's tax payable under this Part for the year if the individual were not entitled to any deduction under any of sections 126, 127 and 127.4, and

(4) Subsections (1) to (3) apply to the 2000 and subsequent taxation years.

30. (1) The Act is amended by adding the following after section 120.3:

Lump-sum Payments

Definitions

120.31 (1) The definitions in subsection 110.2(1) apply in this section.

Addition to tax payable

(2) There shall be added in computing an individual's tax payable under this Part for a particular taxation year the total of all amounts each of which is the amount, if any, by which

    (a) the individual's notional tax payable for an eligible taxation year to which a specified portion of a qualifying amount received by the individual relates and in respect of which an amount is deducted under section 110.2 in computing the individual's taxable income for the particular year

exceeds

    (b) the individual's tax payable under this Part for the eligible taxation year.

Notional tax payable

(3) For the purpose of subsection (2), an individual's notional tax payable for an eligible taxation year, calculated for the purpose of computing the individual's tax payable under this Part for a taxation year (in this subsection referred to as ``the year of receipt'') in which the individual received a qualifying amount, is the total of

    (a) the amount, if any, by which

      (i) the amount that would be the individual's tax payable under this Part for the eligible taxation year if the total of all amounts, each of which is the specified portion, in relation to the eligible taxation year, of a qualifying amount received by the individual before the end of the year of receipt, were added in computing the individual's taxable income for the eligible taxation year

    exceeds

      (ii) the total of all amounts each of which is an amount, in respect of a qualifying amount received by the individual before the year of receipt, that was included because of this paragraph in computing the individual's notional tax payable under this Part for the eligible taxation year, and

    (b) where the eligible taxation year ended before the taxation year preceding the year of receipt, an amount equal to the amount that would be calculated as interest payable on the amount determined under paragraph (a) if it were so calculated

      (i) for the period that began on May 1 of the year following the eligible taxation year and that ended immediately before the year of receipt, and

      (ii) at the prescribed rate that is applicable for the purpose of subsection 164(3) with respect to the period.

Tax on Split Income

Definitions

120.4 (1) The definitions in this subsection apply in this section.

``excluded amount''
« montant exclu »

``excluded amount'', in respect of an individual for a taxation year, means an amount that is the income from a property acquired by or for the benefit of the individual as a consequence of the death of

      (a) a parent of the individual; or

      (b) any person, if the individual is

        (i) enrolled as a full-time student during the year at a post-secondary educational institution (as defined in subsection 146.1(1)), or

        (ii) an individual in respect of whom an amount may be deducted under section 118.3 in computing a taxpayer's tax payable under this Part for the year.

``specified individual''
« particulier déterminé »

``specified individual'', in relation to a taxation year, means an individual who

      (a) had not attained the age of 17 years before the year;

      (b) at no time in the year was non-resident; and

      (c) has a parent who is resident in Canada at any time in the year.

``split income''
« revenu fractionné »

``split income'', of a specified individual for a taxation year, means the total of all amounts (other than excluded amounts) each of which is

      (a) an amount required to be included in computing the individual's income for the year

        (i) in respect of taxable dividends received by the individual in respect of shares of the capital stock of a corporation (other than shares of a class listed on a prescribed stock exchange or shares of the capital stock of a mutual fund corporation), or

        (ii) because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a prescribed stock exchange),

      (b) a portion of an amount included because of the application of paragraph 96(1)(f) in computing the individual's income for the year, to the extent that the portion

        (i) is not included in an amount described in paragraph (a), and

        (ii) can reasonably be considered to be income derived from the provision of goods or services by a partnership or trust to or in support of a business carried on by

          (A) a person who is related to the individual at any time in the year,

          (B) a corporation of which a person who is related to the individual is a specified shareholder at any time in the year, or

          (C) a professional corporation of which a person related to the individual is a shareholder at any time in the year, or

      (c) a portion of an amount included because of the application of subsection 104(13) or 105(2) in respect of a trust (other than a mutual fund trust) in computing the individual's income for the year, to the extent that the portion

        (i) is not included in an amount described in paragraph (a), and

        (ii) can reasonably be considered

          (A) to be in respect of taxable dividends received in respect of shares of the capital stock of a corporation (other than shares of a class listed on a prescribed stock exchange or shares of the capital stock of a mutual fund corporation),

          (B) to arise because of the application of section 15 in respect of the ownership by any person of shares of the capital stock of a corporation (other than shares of a class listed on a prescribed stock exchange), or

          (C) to be income derived from the provision of goods or services by a partnership or trust to or in support of a business carried on by

            (I) a person who is related to the individual at any time in the year,

            (II) a corporation of which a person who is related to the individual is a specified shareholder at any time in the year, or

            (III) a professional corporation of which a person related to the individual is a shareholder at any time in the year.

Tax on split income

(2) There shall be added to a specified individual's tax payable under this Part for a taxation year 29% of the individual's split income for the year.

Tax payable by a specified individual

(3) Notwithstanding any other provision of this Act, where an individual is a specified individual in relation to a taxation year, the individual's tax payable under this Part for the year shall not be less than the amount by which

    (a) the amount added under subsection (2) to the individual's tax payable under this Part for the year

exceeds

    (b) the total of all amounts each of which is an amount that