Bill C-43

(2) Subsection (1) applies to the 2015 and subsequent taxation years.

40. (1) The Act is amended by adding the following before section 125.3:

(2) Subsection (1) applies in respect of taxation years that begin after October 2012.

41. (1) The definition “investor” in subsection 125.4(1) of the Act is repealed.

(2) The definitions “assistance” and “salary or wages” in subsection 125.4(1) of the Act are replaced by the following:

“assistance” means an amount, other than a prescribed amount or an amount deemed under subsection (3) to have been paid, that would be included under paragraph 12(1)(x) in computing a taxpayer’s income for any taxation year if that paragraph were read without reference to

(a) subparagraphs 12(1)(x)(v) to (viii), if the amount were received

“salary or wages” does not include an amount

(a) described in section 7;

(b) determined by reference to profits or revenues; or

(3) The definition “Canadian film or video production certificate” in subsection 125.4(1) of the Act is replaced by the following:

“Canadian film or video production certificate” means a certificate issued in respect of a production by the Minister of Canadian Herit-age certifying that the production is a Canadian film or video production in respect of which that Minister is satisfied that, except where the production is a treaty co-production (as defined in subsection 1106(3) of the Income Tax Regulations), an acceptable share of revenues from the exploitation of the production in non-Canadian markets is, under the terms of any agreement, retained by

(4) The portion of the definition “labour expenditure” in subsection 125.4(1) of the Act before subparagraph (b)(i) is replaced by the following:

“labour expenditure”, of a corporation for a taxation year in respect of a Canadian film or video production, means, in the case of a corporation that is not a qualified corporation for the taxation year, nil, and in the case of a corporation that is a qualified corporation for the taxation year, subject to subsection (2), the total of the following amounts to the extent that they are reasonable in the circumstances and included in the cost to, or in the case of depreciable property the capital cost to, the corporation, or any other person or partnership, of the production:

(a) the salary or wages directly attributable to the production that are incurred after 1994 and in the taxation year, or the preceding taxation year, by the corporation for the stages of production of the property, from the production commencement time to the end of the post-production stage, and paid by it in the taxation year or within 60 days after the end of the taxation year (other than amounts incurred in that preceding taxation year that were paid within 60 days after the end of that preceding taxation year),

(b) that portion of the remuneration (other than salary or wages and other than remuneration that relates to services rendered in the preceding taxation year and that was paid within 60 days after the end of that preceding taxation year) that is directly attributable to the production of property, that relates to services rendered after 1994 and in the taxation year, or that preceding taxation year, to the corporation for the stages of production, from the production commencement time to the end of the post-production stage, and that is paid by it in the taxation year or within 60 days after the end of the taxation year to

(5) The portion of the definition “qualified labour expenditure” in subsection 125.4(1) of the Act before paragraph (a) is replaced by the following:

“qualified labour expenditure”, of a corporation for a taxation year in respect of a Canadian film or video production, means the lesser of

(6) The portion of the description of A in paragraph (b) of the definition “qualified labour expenditure” in subsection 125.4(1) of the Act before subparagraph (ii) is replaced by the following:

A      is 60% of the amount by which

(i) the total of all amounts each of which is an expenditure by the corporation in respect of the production that is included in the cost to, or in the case of depreciable property the capital cost to, the corporation or any other person or partnership of the production at the end of the taxation year,

exceeds

(7) Subsection 125.4(1) of the Act is amended by adding the following in alphabetical order:

(8) The portion of subsection 125.4(2) of the Act before paragraph (b) is replaced by the following:

(2) For the purposes of the definitions “labour expenditure” and “qualified labour expenditure” in subsection (1),

(a) remuneration does not include remuneration

(i) determined by reference to profits or revenues, or

(9) Subsection 125.4(2) of the Act is amended by striking out “and” at the end of paragraph (b), by adding “and” at the end of paragraph (c) and by adding the following after paragraph (c):

(10) Subsection 125.4(4) of the Act is replaced by the following:

(4) This section does not apply to a Canadian film or video production if the production — or an interest in a person or partnership that has, directly or indirectly, an interest in, or for civil law a right in, the production — is a tax shelter investment for the purpose of section 143.2.

(11) Subsection 125.4(6) of the Act is replaced by the following:

(6) If an omission or incorrect statement was made for the purpose of obtaining a Canadian film or video production certificate in respect of a production, or if the production is not a Canadian film or video production,

(a) the Minister of Canadian Heritage may

(i) revoke the certificate, or

(c) for the purpose of subparagraph (3)(a)(i), a certificate that has been revoked is deemed never to have been issued.

(12) Section 125.4 of the Act is amended by adding the following after subsection (6):

(13) Subsections (1) and (10) apply

(a) to taxation years that end after November 14, 2003; and

(b) in respect of a film or video production in respect of which a corporation has, in a return of income filed before November 14, 2003, claimed an amount under subsection 125.4(3) of the Act in respect of a labour expenditure incurred after 1997.

(14) Subsections (2) and (4) to (9) apply

(a) to film or video productions for which the production commencement time of the corporation (or, if there is more than one qualified corporation in respect of the production, of all such corporations) is on or after November 14, 2003; and

(b) to a corporation in respect of a film or video production for which the production commencement time of any corporation is before November 14, 2003

(i) if the earliest labour expenditure of the corporation (or, if there is more than one qualified corporation in respect of the production, of all those corporations) in respect of the production is made after 2003, or

(ii) if the corporation elects (or, if there is more than one qualified corporation in respect of the production, all those corporations jointly elect), in writing, and the election is filed with the Minister of National Revenue on or before the earliest filing-due date of any qualified corporation in respect of the production for that corporation’s taxation year that includes the day on which this Act receives royal assent, and the earliest labour expenditure of all such qualified corporations in respect of the production is made

(A) after the last taxation year of any such corporation that ended before November 14, 2003, or

(B) if the first taxation year of all such corporations includes November 14, 2003, in that taxation year.

(15) The earliest labour expenditure referred to in subsection (14) is to be determined under the provisions of subsections 125.4(1) and (2) of the Act that would apply if subsections (2) and (4) to (9) had not been enacted.

(16) Subsection (3) applies in respect of film or video productions in respect of which certificates are issued by the Minister of Canadian Heritage after December 20, 2002, except that, in respect of those film or video productions in respect of which certificates are issued by the Minister of Canadian Heritage before 2004, the definition “Canadian film or video production certificate” in subsection 125.4(1) of the Act, as enacted by subsection (3), is to be read as follows:

“Canadian film or video production certificate” means a certificate issued in respect of a production by the Minister of Canadian Her-itage

(a) certifying that the production is a Canadian film or video production in respect of which that Minister is satisfied that, except where the production is a treaty co-production (as defined in subsection 1106(3) of the Income Tax Regulations), an acceptable share of revenues from the exploitation of the production in non-Canadian markets is, under the terms of any agreement, retained by

(i) a qualified corporation that owns or owned an interest in, or for civil law a right in, the production,

(ii) a prescribed taxable Canadian corporation related to the qualified corporation, or

(iii) any combination of corporations described in subparagraph (i) or (ii); and

(b) estimating amounts relevant for the purpose of determining the amount deemed under subsection (3) to have been paid in respect of the production.

(17) Subsection (11) is deemed to have come into force on November 15, 2003.

(18) Subsection (12) applies in respect of film or video productions in respect of which certificates are issued by the Minister of Canadian Heritage after December 20, 2002.

42. (1) Subsection 127(7) of the Act is replaced by the following:

(7) If, in a particular taxation year of a taxpayer who is a beneficiary under a trust that is a graduated rate estate or that is deemed to be in existence by section 143, an amount is determined in respect of the trust under paragraph (a), (a.1), (a.4), (a.5), (b) or (e.1) of the definition “investment tax credit” in subsection (9) for its taxation year that ends in that particular taxation year, the trust may, in its return of income for its taxation year that ends in that particular taxation year, designate the portion of that amount that can, having regard to all the circumstances including the terms and conditions of the trust, reasonably be considered to be attributable to the taxpayer and was not designated by the trust in respect of any other beneficiary of the trust, and that portion is to be added in computing the investment tax credit of the taxpayer at the end of that particular taxation year and is to be deducted in computing the investment tax credit of the trust at the end of its taxation year that ends in that particular taxation year.

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

43. (1) The description of C in section 127.51 of the Act is replaced by the following:

C      is

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

44. (1) Subparagraph 127.52(1)(h)(i) of the Act is replaced by the following:

(i) the amounts deducted under any of subsections 110(2), 110.6(2), (2.1) and (12) and 110.7(1),

(2) Subparagraph 127.52(1)(h)(i) of the Act, as enacted by subsection (1), is replaced by the following:

(i) the amounts deducted under any of subsections 110(2), 110.6(2) and (2.1) and 110.7(1),

(3) Subsection (1) applies to amounts deducted in respect of the 2014 and subsequent taxation years.

(4) Subsection (2) applies to amounts deducted in respect of the 2016 and subsequent taxation years.

45. (1) Section 127.53 of the Act is repealed.

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

46. (1) Subparagraph 128.1(1)(b)(iv) of the Act is replaced by the following:

(iv) an excluded right or interest of the taxpayer, other than an interest described in paragraph (k) of the definition “excluded right or interest” in subsection (10),

(2) Paragraph (k) of the definition “excluded right or interest” in subsection 128.1(10) of the Act is replaced by the following:

(k) an interest of the individual in a non-resident testamentary trust that is an estate that arose on and as a consequence of a death if

(i) the interest was never acquired for consideration, and

(3) Subsections (1) and (2) apply to the 2016 and subsequent taxation years.

47. (1) The portion of paragraph 138.1(1)(a) of the Act before subparagraph (i) is replaced by the following:

(a) a trust (in this section referred to as the “related segregated fund trust”) is deemed to be created at the time that is the later of

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

48. (1) The portion of paragraph 143(1)(a) of the Act before subparagraph (i) is replaced by the following:

(a) a trust is deemed to be created on the day that is the later of

(2) The portion of subsection 143(2) of the Act before paragraph (a) is replaced by the following:

(2) If the trust referred to in subsection (1) in respect of a congregation so elects in respect of a taxation year in writing filed with the Minister on or before the trust’s filing-due date for the year and all the congregation’s participating members are specified in the election in accordance with subsection (5), the following rules apply:

(3) The portion of subsection 143(3.1) of the Act before paragraph (a) is replaced by the following:

(3.1) For the purposes of section 118.1, if the eligible amount of a gift made in a taxation year by a trust referred to in subsection (1) in respect of a congregation would, but for this subsection, be included in the total charitable gifts, total cultural gifts or total ecological gifts of the trust for the year and the trust so elects in its return of income under this Part for the year,

(4) The definition “total Crown gifts” in subsection 143(4) of the Act is repealed.

(5) The portion of subsection 143(5) of the Act before paragraph (a) is replaced by the following:

(5) For the purpose of applying subsection (2) to a particular election by the trust referred to in subsection (1) in respect of a congregation for a particular taxation year,

(6) Subsections (1) to (5) apply to the 2016 and subsequent taxation years.

49. (1) The portion of paragraph 143.1(1.2)(a) of the Act before subparagraph (i) is replaced by the following:

(a) a trust (in this section referred to as the “amateur athlete trust”) is deemed

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

50. (1) The portion of paragraph (a) of the definition “earned income” in subsection 146(1) of the Act before subparagraph (i) is replaced by the following:

(a) the taxpayer’s income (other than an amount described in paragraph 12(1)(z)) for a period in the year throughout which the taxpayer was resident in Canada from

(2) The definition “earned income” in subsection 146(1) of the Act is amended by adding the following after paragraph (b.1):

(3) The portion of paragraph (c) of the definition “earned income” in subsection 146(1) of the Act before subparagraph (i) is replaced by the following:

(c) the taxpayer’s income (other than an amount described in paragraph 12(1)(z)) for a period in the year throughout which the taxpayer was not resident in Canada from

(4) Subsections (1) to (3) apply to an individual’s 2014 and subsequent taxation years, except that if an individual elects in writing under this subsection in respect of the individual’s 2011, 2012 or 2013 taxation year and the election is filed with the Minister of National Revenue before March 3, 2015, subsections (1) to (3) apply to the individual’s taxation year in respect of which the election is filed and subsequent taxation years.

51. (1) Subsection 146.1(11) of the Act is repealed.

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

52. (1) Subsection 148(2) of the Act is amended by striking out “and” at the end of paragraph (c), by adding “and” at the end of paragraph (d) and by adding the following after paragraph (d):

(2) Subsection 148(4) of the Act is replaced by the following:

(3) The portion of the definition “adjusted cost basis” in subsection 148(9) of the Act before the description of A is replaced by the following:

“adjusted cost basis”, at any time to a policyholder of the policyholder’s interest in a life insurance policy, means the amount determined by the formula

(A + B + C + D + E + F + G + G.1) – (H + I + J + K + L + M + N + O)

where

(4) The description of E in the definition “adjusted cost basis” in subsection 148(9) of the Act is replaced by the following:

E      is the total of all amounts each of which is an amount that is in respect of the repayment, before that time and after March 31, 1978, of a policy loan and that does not exceed the amount determined by the formula,

(5) The description of G.1 in the definition “adjusted cost basis” in subsection 148(9) of the Act is replaced by the following:

G.1      is, in the case of an interest in a life insurance policy (other than an annuity contract) to which subsection (8.2) applied before that time, the total of all amounts each of which is a mortality gain, as defined by regulation and determined by the issuer of the policy in accordance with the regulations, in respect of the interest immediately before the end of the calendar year that ended in a taxation year that began before that time,

(6) The definition “adjusted cost basis” in subsection 148(9) of the Act is amended by striking out “and” at the end of the description of K and by adding the following after the description of L:

(7) Paragraph (c) of the definition “premium” in subsection 148(9) of the Act is replaced by the following:

(c) the portion of any amount paid under the policy with respect to an accidental death benefit, a disability benefit, an additional risk as a result of insuring a substandard life, an additional risk in respect of the conversion of a term policy into another policy after the end of the year, an additional risk under a settlement option, or an additional risk under a guaranteed insurability benefit, if

(8) Subparagraph (i) of the description of C in paragraph (a) of the definition “proceeds of the disposition” in subsection 148(9) of the Act is replaced by the following:

(9) Section 148 of the Act is amended by adding the following after subsection (10):

53. (1) The portion of subsection 149(5) of the Act before paragraph (a) is replaced by the following:

(5) Notwithstanding subsections (1) and (2), where a club, society or association was for any period, a club, society or association described in paragraph (1)(l) the main purpose of which was to provide dining, recreational or sporting facilities for its members (in this subsection referred to as the “club”), a trust is deemed to have been created on the later of the commencement of the period and the end of 1971 and to have continued in existence throughout the period, and, throughout that period, the following rules apply:

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

54. (1) Subparagraph (a)(iii) of the definition “exempt shares” in subsection 149.1(1) of the Act is replaced by the following:

(iii) on or after March 19, 2007, under the terms of a trust created before March 19, 2007, and not amended on or after March 19, 2007,

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

55. (1) Paragraph 152(1)(b) of the Act is replaced by the following:

(b) the amount of tax, if any, deemed by subsection 120(2) or (2.2), 122.5(3), 122.51(2), 122.7(2) or (3), 122.8(2) or (3), 125.4(3), 125.5(3), 127.1(1), 127.41(3) or 210.2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year.

(2) The portion of subsection 152(4.2) of the Act before paragraph (a) is replaced by the following:

(4.2) Notwithstanding subsections (4), (4.1) and (5), for the purpose of determining — at any time after the end of the normal reassessment period, of a taxpayer who is an individual (other than a trust) or a graduated rate estate, in respect of a taxation year — the amount of any refund to which the taxpayer is entitled at that time for the year, or a reduction of an amount payable under this Part by the taxpayer for the year, the Minister may, if the taxpayer makes an application for that determination on or before the day that is 10 calendar years after the end of that taxation year,

(3) Paragraph 152(4.2)(b) of the Act is replaced by the following:

(b) redetermine the amount, if any, deemed by subsection 120(2) or (2.2), 122.5(3), 122.51(2), 122.7(2) or (3), 122.8(2) or (3), 127.1(1), 127.41(3) or 210.2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year or deemed by subsection 122.61(1) to be an overpayment on account of the taxpayer’s liability under this Part for the year.

(4) Subsections (1) and (3) apply to the 2015 and subsequent taxation years.

(5) Subsection (2) applies to the 2016 and subsequent taxation years.

56. (1) Subsection 156.1(2) of the Act is amended by striking out “or” at the end of paragraph (a), by adding “or” at the end of paragraph (b) and by adding the following after paragraph (b):

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

57. (1) Section 160 of the Act is amended by adding the following after subsection (1.3):

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

58. (1) The portion of subsection 161(2.2) of the Act before paragraph (a) is replaced by the following:

(2.2) Notwithstanding subsections (1) and (2), the total amount of interest payable by a taxpayer (other than a graduated rate estate) under those subsections, for the period that begins on the first day of the taxation year for which a part or instalment of tax is payable and ends on the taxpayer’s balance-due day for the year, in respect of the taxpayer’s tax or instalments of tax payable for the year shall not exceed the amount, if any, by which

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

59. (1) Subsection 163(2) of the Act is amended by adding the following after paragraph (c.3):

(2) Subsection (1) applies to the 2015 and subsequent taxation years.

60. (1) Paragraph 164(1.5)(a) of the Act is replaced by the following:

(a) if the taxpayer is an individual (other than a trust) or a graduated rate estate for the year and the taxpayer’s return of income under this Part for the year was filed on or before the day that is 10 calendar years after the end of the year;

(2) The portion of subsection 164(6) of the Act before paragraph (a) is replaced by the following:

(6) If in the course of administering the graduated rate estate of a taxpayer, the taxpayer’s legal representative has, within the first taxation year of the estate,

(3) The portion of subsection 164(6.1) of the Act before paragraph (a) is replaced by the following:

(6.1) Notwithstanding any other provision of this Act, if a right to acquire securities (as defined in subsection 7(7)) under an agreement in respect of which a benefit was deemed by paragraph 7(1)(e) to have been received by a taxpayer (in this subsection referred to as “the right”) is exercised or disposed of by the taxpayer’s legal representative within the first taxation year of the graduated rate estate of the taxpayer and the representative so elects in prescribed manner and on or before a prescribed day,

(4) Subsections (1) to (3) apply to the 2016 and subsequent taxation years.

61. (1) The portion of paragraph 165(1)(a) of the Act before subparagraph (i) is replaced by the following:

(a) if the assessment is in respect of the taxpayer for a taxation year and the taxpayer is an individual (other than a trust) or a graduated rate estate for the year, on or before the later of

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

62. (1) Paragraph 207.6(1)(a) of the Act is replaced by the following:

(a) a trust is deemed to be created on the day that the arrangement is established;

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

63. (1) Paragraph (b) of the definition “designated beneficiary” in subsection 210(1) of the Act is repealed.

(2) The portion of paragraph (d) of the definition “designated beneficiary” in subsection 210(1) of the Act before subparagraph (i) is replaced by the following:

(d) another trust (in this paragraph referred to as the “other trust”) that is not a graduated rate estate, a mutual fund trust or a trust that is exempt because of subsection 149(1) from tax under Part I on all or part of its taxable income, if any beneficiary under the other trust is at that time

(3) Subparagraph (d)(ii) of the definition “designated beneficiary” in subsection 210(1) of the Act is repealed.

(4) Clause (d)(iii)(A) of the definition “designated beneficiary” in subsection 210(1) of the Act is replaced by the following:

(5) Subparagraph (e)(iii) of the definition “designated beneficiary” in subsection 210(1) of the Act is repealed.

(6) Paragraph 210(2)(a) of the Act is replaced by the following:

(7) Subsections (2), (4) and (6) apply to the 2016 and subsequent taxation years.

64. (1) Section 212 of the Act is amended by adding the following after subsection (3):

(2) Subsection (1) applies to amounts paid or credited after 2014.

65. (1) Paragraph 212.3(1)(b) of the Act is replaced by the following:

(b) the CRIC is immediately after the investment time, or becomes after the investment time and as part of a transaction or event or series of transactions or events that includes the making of the investment, controlled by a non-resident corporation (in this section referred to as the “parent”), and any of the following conditions is satisfied:

(2) Paragraph 212.3(2)(a) of the Act is replaced by the following:

(a) for the purposes of this Part and subject to subsections (3) and (7), the CRIC is deemed to have paid to the parent, and the parent is deemed to have received from the CRIC, at the dividend time, a dividend equal to the total of all amounts each of which is the portion of the fair market value at the investment time of any property (not including shares of the capital stock of the CRIC) transferred, any obligation assumed or incurred, or any benefit otherwise conferred, by the CRIC, or of any property transferred to the CRIC which transfer results in the reduction of an amount owing to the CRIC, that can reasonably be considered to relate to the investment; and

(3) Subsections 212.3(3) and (4) of the Act are replaced by the following:

(3) If a CRIC (or a CRIC and a corporation that is a qualifying substitute corporation in respect of the CRIC at the dividend time) and the parent (or the parent and another non-resident corporation that at the dividend time does not deal at arm’s length with the parent) jointly elect in writing under this subsection in respect of an investment, and the election is filed with the Minister on or before the filing-due date of the CRIC for its taxation year that includes the dividend time, then the dividend that would, in the absence of this subsection, be deemed under paragraph (2)(a) to have been paid by the CRIC to the parent and received by the parent from the CRIC is deemed to have instead been

(a) paid by the CRIC or the qualifying substitute corporation, as agreed on in the election; and

(b) paid to, and received by, the parent or the other non-resident corporation, as agreed on in the election.

(4) The following definitions apply in this section.

“qualifying substitute corporation”, at any time in respect of a CRIC, means a corporation resident in Canada

(a) that is, at that time, controlled by the parent or by a non-resident corporation that does not deal at arm’s length with the parent;

(b) that has, at that time, an equity percentage (as defined in subsection 95(4)) in the CRIC; and

(c) shares of the capital stock of which are, at that time, owned by the parent or another non-resident corporation with which the parent does not, at that time, deal at arm’s length.

(4) Section 212.3 of the Act is amended by adding the following after subsection (5):

(5) Subsection 212.3(6) of the Act is repealed.

(6) Section 212.3 of the Act is amended by adding the following before subsection (7):

(7) Subsection 212.3(7) of the Act is replaced by the following:

(8) Subparagraph 212.3(8)(a)(ii) of the Act is replaced by the following:

(ii) the total that would be determined under subparagraph (i) if this Act were read without reference to paragraph (2)(b) and subsections (7) and (9), and

(9) Subparagraph 212.3(8)(b)(i) of the Act is replaced by the following:

(i) the total of all amounts required by paragraph (2)(b) or subsection (7) to be deducted in computing the paid-up capital in respect of the class before that time

(10) Subsection 212.3(9) of the Act is replaced by the following:

(9) If, in respect of an investment in a subject corporation made by a CRIC that is described in any of paragraphs (10)(a) to (f), an amount is deducted under paragraph (2)(b) or subsection (7) in computing the paid-up capital in respect of a class of shares of the capital stock of a particular corporation and, at a time subsequent to the investment time, there is a reduction of paid-up capital referred to in subparagraph (b)(i) or a receipt of property referred to in the description of A in subparagraph (b)(ii), then the paid-up capital in respect of the class is to be increased, immediately before the subsequent time, by the lesser of

(a) the amount, if any, by which

(i) the total of all amounts deducted, before the subsequent time, under paragraph (2)(b) or subsection (7), in respect of the investment, in computing the paid-up capital in respect of the class

exceeds

(ii) the total of all amounts added under this subsection, in respect of the investment, to the paid-up capital in respect of the class before the time that is immediately before the subsequent time, and

(b) an amount that

(i) if the investment is described in paragraph (10)(a), (b) or (f), the paid-up capital in respect of the class is reduced at the subsequent time as part of or because of a distribution of property by the particular corporation and the property (in this paragraph referred to as the “distributed shares”) is shares of the capital stock of the subject corporation or shares of the capital stock of a foreign affiliate of the particular corporation that were substituted for shares of the capital stock of the subject corporation, is equal to the amount determined by the formula

A/B

A      is

(B) if the investment is described in paragraph (10)(a) or (f), the lesser of

(I) the portion of the fair market value, immediately before the subsequent time, of the distributed shares that can reasonably be considered to relate to the shares (in this paragraph referred to as the “acquired shares”) of the capital stock of the subject corporation that were acquired on the investment (other than any portion described in clause (A)), and

(ii) in any other case, is equal to the amount determined by the formula

A × B/C

where

A      is the amount that is equal to the fair market value of property that the particular corporation demonstrates has been received at the subsequent time by it or by a corporation resident in Canada that was not dealing at arm’s length with the particular corporation at that time (in this subparagraph referred to as the “recipient corporation”)

(A) as proceeds from the disposition of the acquired shares, or other shares to the extent that the proceeds from the disposition of those other shares can reasonably be considered to relate to the acquired shares or to shares of the capital stock of the subject corporation in respect of which an investment described in paragraph (10)(b) was made, other than

(II) proceeds from a disposition of shares to a corporation resi-dent in Canada for which the acquisition of the shares is an investment to which subsection (16) or (18) applies,

(B) as a reduction of paid-up capital or dividend in respect of a class of shares of the capital stock of the subject corporation or the portion, of a reduction of paid-up capital or dividend in respect of a class of shares of the capital stock of a foreign affiliate of the particular corporation that were substituted for shares of the capital stock of the subject corporation, that can reasonably be considered to relate to the subject shares, or

(11) Paragraph 212.3(10)(c) of the Act is amended by striking out “or” at the end of subparagraph (i), by adding “or” at the end of subparagraph (ii) and by adding the following after subparagraph (ii):

(12) Subsection 212.3(15) of the Act is replaced by the following:

(15) For the purposes of this section and paragraph 128.1(1)(c.3),

(a) a CRIC or a taxpayer to which paragraph 128.1(1)(c.3) applies (in this paragraph referred to as the “specific corporation”), that would, in the absence of this subsection, be controlled at any time

(i) by more than one non-resident corporation is deemed not to be controlled at that time by any such non-resident that controls at that time another non-resident corporation that controls at that time the specific corporation, unless the application of this paragraph would otherwise result in no non-resident corporation controlling the specific corporation, and

(ii) by a particular non-resident corporation is deemed not to be controlled at that time by the particular corporation if the particular corporation is controlled at that time by another corporation that is at that time

(A) resident in Canada, and

(B) not controlled by any non-resident person; and

(13) The portion of paragraph 212.3(16)(b) of the Act before subparagraph (i) is replaced by the following:

(b) officers of the CRIC, or of a corporation resident in Canada that did not, at the investment time, deal at arm’s length with the CRIC, had and exercised the principal decision-making authority in respect of the making of the investment and a majority of those officers were, at the investment time, persons each of whom was resident, and working principally,

(14) Paragraph 212.3(16)(c) of the Act is replaced by the following:

(c) at the investment time, it is reasonably expected that

(i) officers of the CRIC, or of a corporation resident in Canada that does not deal at arm’s length with the CRIC, will have and exercise the ongoing principal decision-making authority in respect of the investment,

(ii) a majority of those officers will be persons each of whom will be resident, and working principally, in Canada or in a country in which a connected affiliate is resident, and

(iii) the performance evaluation and compensation of the officers of the CRIC, or of the corporation resident in Canada that does not deal at arm’s length with the CRIC, who are resident, and work principally, in Canada, or in a country in which a connected affiliate is resident, will be based on the results of operations of the subject corporation to a greater extent than will be the performance evaluation and compensation of any officer of a non-resident corporation (other than the subject corporation, a corporation controlled by the subject corporation or a connected affiliate) that does not deal at arm’s length with the CRIC.

(15) Subsection 212.3(17) of the Act is replaced by the following:

(17) For the purposes of paragraphs (16)(b) and (c), any person who is an officer of the CRIC, or of a corporation resident in Canada that does not deal at arm’s length with the CRIC, and of a non-resident corporation that does not, at the investment time, deal at arm’s length with the CRIC (other than the subject corporation, a subject subsidiary corporation or a connected affiliate) is deemed to not be resident, and to not work principally, in a country in which a connected affiliate is resident.

(16) The portion of subsection 212.3(18) of the Act before paragraph (b) is replaced by the following:

(18) Subject to subsections (18.1) to (20), subsection (2) does not apply to an investment in a subject corporation made by a CRIC if

(a) the investment is described in paragraph (10)(a) or (d) and is an acquisition of shares of the capital stock, or a debt obligation, of the subject corporation

(i) from a corporation resident in Canada (in this paragraph referred to as the “disposing corporation”) to which the CRIC is, immediately before the investment time, related (determined without reference to paragraph 251(5)(b)), and

(B) the disposing corporation is, at no time that is in the period and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the parent or a non-resident corporation that participates in the series and is, at any time that is in the period and that is before the investment time, related to the parent, or

(ii) on an amalgamation described in subsection 87(1) of two or more corporations (each of which is in this subparagraph referred to as a “predecessor corporation”) to form the CRIC if

(A) all of the predecessor corporations are, immediately before the amalgam-ation, related to each other (determined without reference to paragraph 251(5)(b)), and

(B) either

(I) none of the predecessor corporations are, at any time that is in the period during which the series of transactions or events that includes the making of the investment occurs and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the parent or a non-resident corporation that participates in the series and is, at any time that is in the period and that is before the investment time, related to the parent, or

(17) Paragraph 212.3(18)(b) is amended by striking out “or” at the end of subparagraph (vi), by adding “or” at the end of subparagraph (vii) and by adding the following after subparagraph (vii):

(18) Paragraph 212.3(18)(c) of the Act is replaced by the following:

(c) the investment is an indirect acquisition referred to in paragraph (10)(f) that results from a direct acquisition of shares of the capital stock of another corporation resident in Canada

(i) from a corporation (in this paragraph referred to as the “disposing corporation”) to which the CRIC is, immediately before the investment time, related (determined without reference to paragraph 251(5)(b)), and

(A) each shareholder of the disposing corporation immediately before the investment time is

(II) at no time that is in the period during which the series of transactions or events that includes the making of the investment occurs and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the parent or a non-resident corporation that participates in the series and is, at any time that is in the period and that is before the investment time, related to the parent, or

(B) the disposing corporation is, at no time that is in the period and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the parent or a non-resident corporation that participates in the series and is, at any time that is in the period and that is before the investment time, related to the parent,

(ii) on an amalgamation described in subsection 87(1) of two or more corporations (each of which is in this subparagraph referred to as a “predecessor corporation”) to form the CRIC, or a corporation of which the CRIC is a shareholder, if

(A) all of the predecessor corporations are, immediately before the amalgam-ation, related to each other (determined without reference to paragraph 251(5)(b)), and

(B) either

(I) none of the predecessor corporations are, at any time that is in the period during which the series of transactions or events that includes the making of the investment occurs and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the parent or a non-resident corporation that participates in the series and is, at any time that is in the period and that is before the investment time, related to the parent, or

(iii) in an exchange to which subsection 51(1) applies,

(iv) in the course of a reorganization of the capital of the other corporation to which subsection 86(1) applies,

(v) to the extent that an investment (other than one described in paragraph (10)(f)) is made in the subject corporation by the other corporation, or by a particular corporation resident in Canada to which the CRIC and the other corporation are related at the investment time, using property transferred, directly or indirectly, by the CRIC to the other corporation or the particular corporation, as the case may be, if the two investments

(A) occur within 90 days of each other, and

(B) are part of the same series of transactions or events, or

(19) Paragraph 212.3(18)(d) of the Act is replaced by the following:

(d) the investment is an acquisition of shares of the capital stock of the subject corporation that is described in paragraph (10)(a), or an indirect acquisition referred to in paragraph (10)(f) that results from a direct acquisition of shares of the capital stock of another corporation resident in Canada, if

(20) Section 212.3 of the Act is amended by adding the following after subsection (18):

(21) The portion of subsection 212.3(19) of the Act before paragraph (a) is replaced by the following:

(19) Subparagraph (1)(b)(ii) applies, and subsection (16) and paragraphs (18)(b) and (d) do not apply, to an acquisition of shares of the capital stock of a subject corporation by a CRIC if, having regard to all the terms and conditions of the shares and any agreement in respect of the shares, the shares cannot reasonably be considered to fully participate in the profits of the subject corporation and any appreciation in the value of the subject corporation, unless the subject corporation would be a subsidiary wholly-owned corporation of the CRIC throughout the period during which the series of transactions or events that includes the acquisition occurs if the CRIC owned all of the shares of the capital stock of the subject corporation that are owned by any of

(22) Paragraph 212.3(22)(a) of the Act is amended by striking out “and” at the end of subparagraph (i) and by adding the following after subparagraph (ii):

(23) Subsection 212.3(23) of the Act is replaced by the following:

(23) Subsection (2) applies to an investment in a subject corporation made by a CRIC to which, in the absence of this subsection, subsection (2) would not apply because of subsection (16) or (24), to the extent that one or more properties received by the subject corporation from the CRIC as a result of the investment, or property substituted for any such property, may reasonably be considered to have been used by the subject corporation, directly or indirectly as part of a series of transactions or events that includes the making of the investment, in a transaction or event to which subsection (2) would have applied if the CRIC had entered into the transaction, or participated in the event, as the case may be, instead of the subject corporation.

(24) Paragraphs 212.3(24)(a) to (c) of the Act are replaced by the following:

(a) all the properties received by the subject corporation from the CRIC as a result of the investment were used, at a particular time that is within 30 days after the investment time and at all times after the particular time, by the subject corporation

(b) the particular corporation was, at the particular time, a controlled foreign affiliate of the CRIC for the purposes of section 17; and

(c) the particular corporation is, throughout the period that begins at the investment time and during which the series of transactions or events that includes the activities of, or the making of the loan or acquisition of property by, the subject corporation occurs, a corporation in which an investment made by the CRIC would not be subject to subsection (2) because of subsection (16).

(25) Subject to subsections (26) and (27), subsections (1) to (5), (7) to (18) and (21) to (24) apply in respect of transactions and events that occur after March 28, 2012, except that

(a) an election referred to in subsection 212.3(3) of the Act, as enacted by subsection (3), is deemed to have been filed on a timely basis if the election is filed on or before the filing-due date of the electing CRIC for its taxation year that includes the day on which this Act receives royal assent;

(b) in respect of transactions and events that occur before August 29, 2014, subsection 212.3(4) of the Act, as enacted by subsection (3), is to be read without reference to paragraph (b) of the definition “cross-border class”;

(c) a form referred to in paragraph 212.3(7)(d) of the Act, as enacted by subsection (7), is deemed to have been filed by the CRIC referred to in that paragraph on a timely basis if the form is filed on or before the day that is the later of the CRIC’s filing-due date for its taxation year that includes the day on which this Act receives royal assent and one year after the day on which this Act receives royal assent;

(d) in respect of transactions and events that occur before August 29, 2014, the reference to “on the filing-due date” in subparagraph 212.3(7)(d)(ii), as enacted by subsection (7), is to be read as a reference to the time that is the later of the filing-due date for the CRIC’s taxation year that includes the day on which this Act receives royal assent and one year after the day on which this Act receives royal assent;

(e) in respect of transactions and events that occur before August 16, 2013

(i) subparagraph 212.3(9)(b)(ii) of the Act, as enacted by subsection (10), is to be read without reference to subclause (A)(I) in the description of A,

(ii) subsection 212.3(15) of the Act, as enacted by subsection (12), is to be read without reference to paragraph (b), and

(iii) the portion of subsection 212.3(18) of the Act before paragraph (a), as enacted by subsection (16), is to be read as follows:

(18) Subject to subsections (19) and (20), subsection (2) does not apply to an investment in a subject corporation made by a CRIC if

(f) in respect of transactions and events that occur before August 29, 2014

(i) clause 212.3(18)(a)(i)(B) of the Act, as enacted by subsection (16), is to be read as follows:

(B) the disposing corporation is, at no time that is in the period and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the CRIC, or

(ii) subclause 212.3(18)(a)(ii)(B)(I) of the Act, as enacted by subsection (16), is to be read as follows:

(I) none of the predecessor corporations deal at arm’s length (determined without reference to paragraph 251(5)(b)) with another predecessor corporation at any time that is in the period during which the series of transactions or events that includes the making of the investment occurs and that is before the investment time, or

(iii) clause 212.3(18)(c)(i)(B) of the Act, as enacted by subsection (18), is to be read as follows:

(B) the disposing corporation is, at no time that is in the period and that is before the investment time, dealing at arm’s length (determined without reference to paragraph 251(5)(b)) with the CRIC,

(iv) subclause 212.3(18)(c)(ii)(B)(I) of the Act, as enacted by subsection (18), is to be read as follows:

(I) none of the predecessor corporations deal at arm’s length (determined without reference to paragraph 251(5)(b)) with another predecessor corporation at any time that is in the period during which the series of transactions or events that includes the making of the investment occurs and that is before the investment time, or

(26) If an election is made under subsection 49(3) of the Jobs and Growth Act, 2012, section 212.3 of the Income Tax Act applies in the manner set out in that subsection in respect of transactions and events that occur after March 28, 2012 and before August 14, 2012.

(27) If a taxpayer elects in writing under this subsection and files the election with the Minister of National Revenue on or before the day that is the later of the taxpayer’s filing-due date for its taxation year that includes the day on which this Act receives royal assent and the day that is one year after the day on which this Act receives royal assent, then, in respect of transactions and events that occur before August 16, 2013, subsection 212.3(9) of the Act, as enacted by subsection (10), is to be read as follows:

(9) If, in respect of an investment in a subject corporation made by a CRIC that is described in any of paragraphs (10)(a) to (f), an amount is required by paragraph (2)(b) or subsection (7) to be deducted in computing the paid-up capital in respect of a class of shares of the capital stock of a particular corporation, and the paid-up capital in respect of the class is reduced at a time subsequent to the investment time, then the paid-up capital in respect of the class is to be increased, immediately before the subsequent time, by the least of

(a) the amount by which the paid-up capital of the class is reduced at the subsequent time,

(b) the amount, if any, by which

(i) the total of all amounts each of which is required, before the subsequent time, by paragraph (2)(b) or subsection (7) to be deducted, in respect of the investment, in computing the paid-up capital in respect of the class

exceeds

(ii) the total of all amounts required under this subsection to be added, in respect of the investment, to the paid-up capital of the class before the subsequent time, and

(c) an amount that

(i) if the paid-up capital of the class is reduced at the subsequent time as part of or because of a distribution of property by the particular corporation and the property is shares of the capital stock of the subject corporation (in this paragraph referred to as the “subject shares”) or shares of the capital stock of a foreign affiliate of the particular corporation that were substituted for the subject shares, is equal to the fair market value of the subject shares, or the portion of the fair market value of the substituted shares that may reasonably be considered to relate to the subject shares, as the case may be, at the subsequent time,

(ii) is equal to the fair market value of property that the particular corporation demonstrates it has received directly or indirectly after the investment time and no more than 180 days before the subsequent time

(A) as proceeds from the disposition of the subject shares, or as the portion of the proceeds from the disposition of the substituted shares that may reasonably be considered to relate to the subject shares,

(B) as a dividend or qualifying return of capital, within the meaning assigned by subsection 90(3), in respect of a class of subject shares, or the portion of a dividend or reduction of paid-up capital in respect of a class of substituted shares that may reasonably be considered to relate to the subject shares, or

(C) if the investment is described in paragraph (10)(c) or (d) or subparagraph (10)(e)(i),

(I) as a repayment of or as proceeds from the disposition of the debt obligation, or amount owing, in connection with the investment, or

(II) as interest on the debt obligation or amount owing, or

(iii) if neither subparagraph (i) nor (ii) applies, is equal to nil.

(28) Subsection (6) applies in respect of transactions and events that occur after August 28, 2014.

(29) Subsections (19) and (20) apply in respect of transactions and events that occur after August 15, 2013.

66. (1) Paragraph 219.1(3)(b) of the Act is replaced by the following:

(b) an amount is required by paragraph 212.3(2)(b) or subsection 212.3(7) to be deducted in computing the paid-up capital in respect of a class of shares of the capital stock of the corporation because of an investment in a subject corporation made by a CRIC that is described in any of paragraphs 212.3(10)(a) to (f);

(2) Paragraph 219.1(4)(a) of the Act is replaced by the following:

(a) the total of all amounts each of which is an amount by which the paid-up capital of a class of shares of the capital stock of the corporation was required by paragraph 212.3(2)(b) or subsection 212.3(7) to be reduced in respect of an investment in a subject corporation made by the CRIC that is described in any of paragraphs 212.3(10)(a) to (f), and

(3) Paragraph 219.1(4)(b) of the Act is amended by striking out “or” at the end of subparagraph (i), by adding “or” at the end of subparagraph (ii) and by adding the following after subparagraph (ii):

(4) Subsections (1) to (3) apply to corporations that cease to be resident in Canada after March 28, 2012.

67. (1) Paragraph 220(4.51)(a) of the Act is replaced by the following:

(a) the total amount of those taxes that would be payable for the year by a trust resident in Canada (other than a graduated rate estate or a qualified disability trust as defined in subsection 122(3)) the taxable income of which for the year is $50,000, and

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

68. (1) Section 227 of the Act is amended by adding the following after subsection (6.1):

(2) Paragraph 227(8.5)(b) of the Act is replaced by the following:

(b) an amount deemed by subparagraph 212.3(7)(d)(ii) or subsection 247(12) to have been paid as a dividend by the corporation.

(3) Subsections (1) and (2) apply in respect of transactions and events that occur after March 28, 2012.

69. (1) Subparagraph 233.4(1)(c)(i) of the Act is replaced by the following:

(i) where the total of all amounts, each of which is a share of the partnership’s income or loss for the period of a member that is not resident in Canada or that is a taxpayer all of whose taxable income for the year in which the period ends is exempt from tax under Part I, is less than 90% of the income or loss of the partnership for the period, and, where the income and loss of the partnership are nil for the period, the income of the partnership for the period is deemed to be $1,000,000 for the purpose of determining a member’s share of the partnership’s income for the purpose of this subparagraph, and

(2) Subsection 233.4(2) of the Act is amended by striking out “and” at the end of paragraph (b), by adding “and” at the end of paragraph (c) and by adding the following after paragraph (c):

(3) Subsections (1) and (2) apply in respect of taxation years that end after July 11, 2013.

70. (1) Section 241 of the Act is amended by adding the following after subsection (3.2):

(2) Paragraph 241(4)(d) of the Act is amended by striking out “or” at the end of subparagraph (xiv) and by adding the following after subparagraph (xv):

71. (1) Subparagraph (f)(vi) of the definition “disposition” in subsection 248(1) of the Act is replaced by the following:

(vi) if the transferor is an amateur athlete trust, a cemetery care trust, an employee trust, a trust deemed by subsection 143(1) to exist in respect of a congregation that is a constituent part of a religious organization, a related segregated fund trust (in this paragraph having the meaning assigned by section 138.1), a trust described in paragraph 149(1)(o.4) or a trust governed by an eligible funeral arrangement, an employees profit sharing plan, a registered disability savings plan, a registered education savings plan, a registered supplementary unemployment benefit plan or a TFSA, the transferee is the same type of trust, and

(2) The portion of the definition “international traffic” in subsection 248(1) of the Act before paragraph (a) is replaced by the following:

“international traffic” means, in respect of a person or partnership carrying on the business of transporting passengers or goods, a voyage made in the course of that business if the principal purpose of the voyage is to transport passengers or goods

(3) Paragraph (a) of the definition “personal trust” in subsection 248(1) of the Act is replaced by the following:

(4) The portion of paragraph (b) of the definition “personal trust” in subsection 248(1) of the Act before subparagraph (i) is replaced by the following:

(b) a trust in which no beneficial interest was acquired for consideration payable directly or indirectly to

(5) Subparagraph (e)(i) of the definition “taxable Canadian property” in subsection 248(1) of the Act is amended by striking out “and” at the end of clause (A) and by adding the following after clause (B):

(6) Subsection 248(1) of the Act is amended by adding the following in alphabetical order:

(7) The portion of subsection 248(25.1) of the Act before paragraph (a) is replaced by the following:

(25.1) If, at any time, a particular trust transfers property to another trust (other than a trust governed by a registered retirement savings plan or by a registered retirement income fund) in circumstances to which paragraph (f) of the definition “disposition” in subsection (1) applies, without affecting the personal liabilities under this Act of the trustees of either trust or the application of subsection 104(5.8),

(8) Section 248 of the Act is amended by adding the following after subsection (28):

(9) Subsections (1), (3), (4) and (7) apply to the 2016 and subsequent taxation years.

(10) Subsection (2) and the definition “international shipping” in subsection 248(1) of the Act, as enacted by subsection (6), apply to taxation years that begin after July 12, 2013.

(11) Subsection (5) applies in determining after July 11, 2013 whether a property is taxable Canadian property of a taxpayer.

(12) The definition “graduated rate estate” in subsection 248(1) of the Act, as enacted by subsection (6), comes into force on December 31, 2015.

(13) Subsection (8) applies in respect of property disposed of, or transferred, in the 2014 and subsequent taxation years.

72. (1) Paragraphs 249(1)(b) and (c) of the Act are replaced by the following:

(b) in the case of a graduated rate estate, the period for which the accounts of the estate are made up for purposes of assessment under this Act; and

(c) in any other case, a calendar year.

(2) Section 249 of the Act is amended by adding the following after subsection (4):

(3) Subsection 249(5) of the Act is replaced by the following:

(5) The period for which the accounts of a graduated rate estate are made up for the purposes of an assessment under this Act may not exceed 12 months, and no change in the time when that period ends may be made for the purposes of this Act without the concurrence of the Minister.

(4) Subsection 249(6) of the Act is repealed.

(5) Subsections (1) and (3) apply to the 2016 and subsequent taxation years.

(6) Subsection (2) comes into force or is deemed to have come into force on December 31, 2015.

(7) Subsection (4) applies to transactions and events that occur after 2015.

73. (1) The portion of paragraph 249.1(1)(b) of the Act before clause (ii)(B) is replaced by the following:

(b) in the case of

(i) an individual (other than an individual to whom section 149 or 149.1 applies or a trust),

(i.1) a trust (other than a mutual fund trust if the fiscal period is one to which paragraph 132.11(1)(c) applies or a graduated rate estate),

(ii) a partnership of which

(A) an individual (other than an individ-ual to whom section 149 or 149.1 applies or a graduated rate estate),

(2) Subparagraph 249.1(4)(c)(ii) of the Act is replaced by the following:

(ii) who is a member of a partnership no member of which is a graduated rate estate,

(3) Paragraph 249.1(4)(d) of the Act is replaced by the following:

(d) in the case of an individual who is a member of a partnership a member of which is a graduated rate estate, an election in prescribed form to have paragraph (1)(b) not apply is filed with the Minister by the individual on or before the earliest of the filing-due dates of the members of the partnership for a taxation year that includes the first day of the first fiscal period of the business that begins after 1994.

(4) Clause 249.1(6)(b)(i)(B) of the Act is replaced by the following:

(B) who is a member of a partnership no member of which is a graduated rate estate,

(5) Subparagraph 249.1(6)(b)(ii) of the Act is replaced by the following:

(ii) in the case of an individual who is a member of a partnership a member of which is a graduated rate estate, by the individual on or before the earliest of the filing-due dates of the members of the partnership for a taxation year that includes the first day of the first fiscal period of the business that begins after the beginning of the particular year.

(6) Subsections (1) to (5) apply to the 2016 and subsequent taxation years.

74. (1) The portion of subsection 250(6) of the Act before paragraph (c) is replaced by the following:

(6) For the purposes of this Act, a corporation that was incorporated or otherwise formed under the laws of a country other than Canada or of a state, province or other political subdivision of such a country is deemed to be resident in that country throughout a taxation year and not to be resident in Canada at any time in the year, if

(a) the corporation

(i) has international shipping as its principal business in the year, or

(ii) holds eligible interests in one or more eligible entities throughout the year and at no time in the year is the total of the cost amounts to it of all those eligible interests and of all debts owing to it by an eligible entity in which an eligible interest is held by it, by a person related to it or by a partnership affiliated with it less than 50% of the total of the cost amounts to it of all its property;

(b) all or substantially all the corporation’s gross revenue for the year consists of any one or more of

(i) gross revenue from international shipping,

(2) Section 250 of the Act is amended by adding the following after subsection (6):

(3) Subsections (1) and (2) apply to taxation years that begin after July 12, 2013.

75. (1) Subsection 251.2(1) of the Act is amended by adding the following in alphabetical order:

(2) Subsection 251.2(3) of the Act is amended by striking out “or” at the end of paragraph (d), by adding “or” at the end of paragraph (e) and by adding the following after paragraph (e):

(3) Section 251.2 of the Act is amended by adding the following after subsection (6):

(4) Subsections (1) to (3) are deemed to have come into force on March 21, 2013, except that if a trust elects in writing and files the election with the Minister of National Revenue on or before the trust’s filing-due date for its last taxation year that ends before January 1, 2015, then those subsections are deemed to have come into force in respect of that trust on January 1, 2014.

76. (1) Subparagraphs 256(1.2)(f)(i) to (iii) of the Act are replaced by the following:

(ii) where a beneficiary’s share of the accumulating income or capital therefrom depends on the exercise by any person of, or the failure by any person to exercise, any discretionary power, those shares are deemed to be owned at that time by the beneficiary,

(iii) in any case where subparagraph (ii) does not apply, a beneficiary is deemed at that time to own the proportion of those shares that the fair market value of the beneficial interest in the trust of the beneficiary is of the fair market value of all beneficial interests in the trust, and

(2) Subsection (1) applies to the 2016 and subsequent taxation years.

77. (1) Paragraph 261(3)(b) of the Act is replaced by the following:

(b) the taxpayer has elected that subsection (5) apply to the taxpayer and has filed that election with the Minister in prescribed form and manner on or before the day that is 60 days after the first day of the particular taxation year;

(2) Subparagraph 261(6)(a)(iii) of the Act is replaced by the following:

(iii) begins on or after the first day of the particular taxpayer’s first functional currency year;

(3) Clause 261(6.1)(a)(i)(C) of the Act is replaced by the following:

(C) begins on or after the first day of the particular taxpayer’s first functional currency year,

(4) Clause 261(11)(b)(i)(A) of the Act is replaced by the following:

(A) the total of the taxes payable by the taxpayer under Parts I, VI, VI.1 and XIII.1 for the particular taxation year, as determined in the taxpayer’s elected functional currency

(5) The portion of paragraph 261(11)(c) of the Act before subparagraph (i) is replaced by the following:

(c) for the purposes of determining any amount (other than tax) that is payable by the taxpayer under Part I, VI, VI.1 or XIII.1 for the particular taxation year, the taxpayer’s tax payable under the Part for the particular taxation year is deemed to be equal to the total of

(6) Paragraph 261(11)(d) of the Act is replaced by the following:

(d) amounts of tax that are payable under this Act (except under Parts I, VI, VI.1 and XIII.1) by the taxpayer for the particular taxation year are to be determined by converting those amounts, as determined in the taxpayer’s elected functional currency, to Canadian currency using the relevant spot rate for the day on which those amounts are due;

(7) Section 261 of the Act is amended by adding the following after subsection (17):

(8) Subsections (1) to (3) apply to taxation years that begin after July 12, 2013.

(9) Subsections (4) to (6) apply to taxation years that begin after December 13, 2007.

(10) Subsection (7) applies in respect of amalgamations that occur after July 12, 2013.