Her Excellency the Governor General recommends to the House of Commons the appropriation of public revenue under the circumstances, in the manner and for the purposes set out in a measure entitled “An Act to implement certain provisions of the budget tabled in Parliament on April 7, 2022 and other measures”.

Part 1 implements certain income tax measures by

It also makes related and consequential amendments to the Excise Tax Act, the Children’s Special Allowances Act, the Excise Act, 2001, the Income Tax Regulations and the Children’s Special Allowance Regulations.

Part 2 implements certain Goods and Services Tax/Harmonized Sales Tax (GST/HST) measures by

Part 3 amends the Excise Act, 2001, the Excise Act and other related texts in order to implement three measures.

Division 1 of Part 3 implements a new federal excise duty framework for vaping products by, among other things,

Division 2 of Part 3 amends the excise duty exemption under the Excise Act, 2001 for wine produced in Canada and composed wholly of agricultural or plant product grown in Canada.

Division 3 of Part 3 amends the Excise Act to eliminate excise duty for beer containing no more than 0.‍5% alcohol by volume.

Part 4 enacts the Select Luxury Items Tax Act. That Act creates a new taxation regime for domestic sales, and importations into Canada, of certain new motor vehicles and aircraft priced over $100,000 and certain new boats priced over $250,000. It provides that the tax applies if the total price or value of the subject select luxury item at the time of sale or importation exceeds the relevant price threshold. It provides that the tax is to be calculated at the lesser of 10% of the total price of the item and 20% of the total price of the item that exceeds the relevant price threshold. To promote compliance with the new taxation regime, that Act includes modern elements of administration and enforcement aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the new tax and to ensure a cohesive and efficient administration by the CRA.

Division 1 of Part 5 retroactively renders a provision of the contract that is set out in the schedule to An Act respecting the Canadian Pacific Railway, chapter 1 of the Statutes of Canada, 1881, to be of no force or effect. It retroactively extinguishes any obligations and liabilities of Her Majesty in right of Canada and any rights and privileges of the Canadian Pacific Railway Company arising out of or acquired under that provision.

Division 2 of Part 5 amends the Nisga’a Final Agreement Act to give force of law to the entire Nisga’a Nation Taxation Agreement during the period that that Taxation Agreement is, by its terms, in force.

Division 3 of Part 5 repeals the Safe Drinking Water for First Nations Act.

It also amends the Income Tax Act to exempt from taxation under that Act any income earned by the Safe Drinking Water Trust in accordance with the Settlement Agreement entered into on September 15, 2021 relating to long-term drinking water quality for impacted First Nations.

Division 4 of Part 5 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of addressing transit shortfalls and needs and improving housing supply and affordability.

Division 5 of Part 5 amends the Canada Deposit Insurance Corporation Act by adding the President and Chief Executive Officer of the Canada Deposit Insurance Corporation and one other member to that Corporation’s Board of Directors.

Division 6 of Part 5 amends the Federal-Provincial Fiscal Arrangements Act to authorize additional payments to the provinces and territories.

Division 7 of Part 5 amends the Borrowing Authority Act to, among other things, count previously excluded borrowings made in the spring of 2021 in the calculation of the maximum amount that may be borrowed. It also amends the Financial Administration Act to change certain reporting requirements in relation to amounts borrowed under orders made under paragraph 46.‍1(c) of that Act.

Division 8 of Part 5 amends the Pension Benefits Standards Act, 1985 to, among other things, permit the establishment of a solvency reserve account in the pension fund of certain defined benefit plans and require the establishment of governance policies for all pension plans.

Division 9 of Part 5 amends the Special Import Measures Act to, among other things,

It also amends the Canadian International Trade Tribunal Act to provide that trade unions may, with the support of domestic producers, file global safeguard complaints.

Division 10 of Part 5 amends the Trust and Loan Companies Act and the Insurance Companies Act to, among other things, modernize corporate governance communications of financial institutions.

Division 11 of Part 5 amends the Insurance Companies Act to permit property and casualty companies and marine companies to not include the value of certain debt obligations when calculating their borrowing limit.

Division 12 of Part 5 enacts the Prohibition on the Purchase of Residential Property by Non-Canadians Act. The Act prohibits the purchase of residential property in Canada by non-Canadians unless they are exempted by the Act or its regulations or the purchase is made in certain circumstances specified in the regulations.

Division 13 of Part 5 amends the Parliament of Canada Act and makes consequential and related amendments to other Acts to, among other things,

Division 14 of Part 5 amends the Financial Administration Act in order to, among other things, allow the Treasury Board to provide certain services to certain entities.

Division 15 of Part 5 amends the Competition Act to enhance the Commissioner of Competition’s investigative powers, criminalize wage fixing and related agreements, increase maximum fines and administrative monetary penalties, clarify that incomplete price disclosure is a false or misleading representation, expand the definition of anti-competitive conduct, allow private access to the Competition Tribunal to remedy an abuse of dominance and improve the effectiveness of the merger notification requirements and other provisions.

Division 16 of Part 5 amends the Copyright Act to extend certain terms of copyright protection, including the general term, from 50 to 70 years after the life of the author and, in doing so, implements one of Canada’s obligations under the Canada–United States–Mexico Agreement.

Division 17 of Part 5 amends the College of Patent Agents and Trademark Agents Act to, among other things,

Division 18 of Part 5 enacts the Civil Lunar Gateway Agreement Implementation Act to implement Canada’s obligations under the Memorandum of Understanding between the Government of Canada and the Government of the United States of America concerning Cooperation on the Civil Lunar Gateway. It provides for powers to protect confidential information provided under the Memorandum. It also makes related amendments to the Criminal Code to extend its application to activities related to the Lunar Gateway and to the Government Employees Compensation Act to address the cross-waiver of liability set out in the Memorandum.

Division 19 of Part 5 amends the Corrections and Conditional Release Act to restrict the use of detention in dry cells to cases where the institutional head has reasonable grounds to believe that an inmate has ingested contraband or that contraband is being carried in the inmate’s rectum.

Division 20 of Part 5 amends the Customs Act in order to authorize its administration and enforcement by electronic means and to provide that the importer of record of goods is jointly and severally, or solidarily, liable to pay duties on the goods under section 17 of that Act with the importer or person authorized to account for the goods, as the case may be, and the owner of the goods.

Division 21 of Part 5 amends the Criminal Code to create an offence of wilfully promoting antisemitism by condoning, denying or downplaying the Holocaust through statements communicated other than in private conversation.

Division 22 of Part 5 amends the Judges Act, the Federal Courts Act, the Tax Court of Canada Act and certain other acts to, among other things,

Division 23 of Part 5 amends the Immigration and Refugee Protection Act to, among other things,

Division 24 of Part 5 amends the Old Age Security Act to correct a cross-reference in that Act to the Budget Implementation Act, 2021, No. 1.

Division 25 of Part 5

Division 26 of Part 5 amends the Employment Insurance Act to, among other things,

It also makes a consequential amendment to the Income Tax Act.

Division 27 of Part 5 amends the Employment Insurance Act to specify the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers and to extend, until October 28, 2023, the increase in the maximum number of weeks for which those benefits may be paid. It also amends the Budget Implementation Act, 2021, No. 1 to add a transitional measure in relation to amendments to the Employment Insurance Regulations that are found in that Act.

Division 28 of Part 5 amends the Canada Pension Plan to make corrections respecting

Division 29 of Part 5 amends An Act to amend the Criminal Code and the Canada Labour Code to, among other things,

Division 30 of Part 5 amends the Canada Business Corporations Act to, among other things,

(a) require certain corporations to send to the Director appointed under that Act information on individuals with significant control on an annual basis or when a change occurs;

(b) allow that Director to provide all or part of that information to an investigative body, the Financial Transactions and Reports Analysis Centre of Canada or any prescribed entity; and

(c) clarify that, for the purposes of subsection 21.‍1(7) of that Act, it is the securities of a corporation, not the corporation itself, that are listed and posted for trading on a designated stock exchange.

Division 31 of Part 5 amends the Special Economic Measures Act and the Justice for Victims of Corrupt Foreign Officials Act (Sergei Magnitsky Law) to, among other things,

It also makes amendments to the Seized Property Management Act in relation to those forfeiture of property regimes.

Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

• Labour mobility deduction

  (t) if the taxpayer is an eligible tradesperson for the year, an amount equal to the lesser of

  • (i) $4,000, and

  • (ii) the total of all amounts each of which is a temporary relocation deduction of the taxpayer for the year in respect of an eligible temporary relocation of the taxpayer.

Labour mobility deduction — interpretation

(14) For the purposes of this subsection and para­graph (1)‍(t),

• (a) a taxpayer is an eligible tradesperson for a taxation year if, in the taxation year, the taxpayer has income from employment as a tradesperson or apprentice and performs their duties of employment in construction activities described in subsection 238(1) of the Income Tax Regulations;

• (b) a temporary work location of a taxpayer is a location in Canada

  • (i) at which the taxpayer performs their duties of employment under a temporary employment contract, and

  • (ii) that is not situated in the locality where the taxpayer is ordinarily employed or carrying on business;

• (c) an eligible temporary relocation of a taxpayer is a temporary relocation that meets the following conditions:

  • (i) the relocation is undertaken by the taxpayer to enable the taxpayer to perform their duties of employment as an eligible tradesperson at one or more temporary work locations of the taxpayer within the same locality,

  • (ii) prior to the relocation, the taxpayer ordinarily resided at a residence in Canada (in this subsection referred to as the “ordinary residence”),

  • (iii) the taxpayer was required by their duties of employment referred to in subparagraph (i) to be away from the ordinary residence for a period of not less than 36 hours,

  • (iv) during the temporary relocation, the taxpayer temporarily resided at one or more lodgings in Canada (in this subsection referred to as the “temporary lodging”), and

  • (v) the distance between the ordinary residence and each temporary work location of the taxpayer referred to in subparagraph (i) is not less than 150 kilometres greater than the distance between each temporary lodging referred in subparagraph (iv) and each temporary work location of the taxpayer referred to in subparagraph (i);

• (d) subject to paragraph (e), an eligible temporary relocation expense of a taxpayer for a taxation year is a reasonable expense incurred by the taxpayer during the taxation year, the previous taxation year or prior to February 1 of the following taxation year, in respect of

  • (i) transportation for one round trip per eligible temporary relocation by the taxpayer between the ordinary residence and the temporary lodging,

  • (ii) meals consumed by the taxpayer during the round trip described in subparagraph (i), and

  • (iii) the taxpayer’s temporary lodging if, throughout the period of the taxpayer’s temporary relocation,

    • (A) the taxpayer maintains their ordinary residence as their principal place of residence, and

    • (B) the ordinary residence remains available for the taxpayer’s occupancy and is not rented to any other person;

• (e) an eligible temporary relocation expense described in paragraph (d) does not include an expense incurred by the taxpayer to the extent that

  • (i) the expense is deducted (other than under paragraph (1)‍(t)) in computing the taxpayer’s income for any taxation year,

  • (ii) the expense was deductible under paragraph (1)‍(t) by the taxpayer for the immediately preceding taxation year, or

  • (iii) the taxpayer is entitled to receive a reimbursement, allowance or any other form of assistance (other than an amount that is included in computing the income for any taxation year of the taxpayer and that is not deductible in computing the income of the taxpayer) in respect of the expense; and

• (f) a taxpayer’s temporary relocation deduction for a taxation year in respect of an eligible temporary relocation of the taxpayer is the lesser of

  • (i) the total eligible temporary relocation expenses of the taxpayer for the taxation year incurred in respect of the eligible temporary relocation, and

  • (ii) half of the taxpayer’s total income for the taxation year from employment as an eligible tradesperson at all temporary work locations referred to in subparagraph (c)‍(i) in respect of the eligible temporary relocation (computed without reference to this section).

Recapture — Class 10.‍1 Passenger Vehicle

(2) Notwithstanding subsection 13(1), where an excess amount is determined under that subsection at the end of a taxation year in respect of a passenger vehicle having a cost to a taxpayer in excess of $20,000 or such other amount as may be prescribed, unless it was, at any time, designated immediate expensing property as defined in subsection 1104(3.‍1) of the Income Tax Regulations, that excess amount shall not be included in computing the taxpayer’s income for the year but shall be deemed, for the purposes of B in the definition undepreciated capital cost in subsection 13(21), to be an amount included in the taxpayer’s income for the year by reason of this section.

• (i) if the cost to a taxpayer of a zero-emission passenger vehicle exceeds the prescribed amount in subsection 7307(1.‍1) of the Income Tax Regulations, or if the cost of a passenger vehicle that was, at any time, designated immediate expensing property as defined in subsection 1104(3.‍1) of the Income Tax Regulations exceeds the prescribed amount in subsection 7307(1) of the Income Tax Regulations,

  • (i) the capital cost to the taxpayer of the vehicle is deemed to be equal to the prescribed amount under subsection 7307(1) or (1.‍1), as the case may be, and

• Social assistance

  (h) where the taxpayer is an individual (other than a trust), a social assistance payment (other than a prescribed payment) ordinarily made on the basis of a means, needs or income test under a program provided for by an Act of Parliament, a law of a province or a law of an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act), to the extent that it is received directly or indirectly by the taxpayer for the benefit of another individual (other than the taxpayer’s spouse or common-law partner or a person who is related to the taxpayer or to the taxpayer’s spouse or common-law partner), if

• Social assistance for informal care programs

  (h.‍1) if the taxpayer is an individual (other than a trust), a social assistance payment ordinarily made on the basis of a means, needs or income test provided for under a program of the Government of Canada, the government of a province or of an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act), to the extent that it is received directly or indirectly by the taxpayer for the benefit of a particular individual, if

• (a) a maximum of $20,000 of qualifying expenditures for a taxation year in respect of a qualifying individual can be claimed under subsection (3) by the qualifying individual and all eligible individuals in respect of the qualifying individual;

• (b) if there is more than one qualifying individual in respect of an eligible dwelling, a maximum of $20,000 of qualifying expenditures for a taxation year in respect of the eligible dwelling can be claimed under subsection (3) by the qualifying individuals and all eligible individuals in respect of the qualifying individuals; and

• (ii) is required to be administered at least two times each week for a total duration averaging not less than 14 hours a week, and

Time spent on therapy

(1.‍1) For the purpose of paragraph 118.‍3(1)‍(a.‍1), in determining whether therapy is required to be administered at least two times each week for a total duration averaging not less than an average of 14 hours a week, the time spent on administering therapy

• (b) in the case of therapy that requires

  • (i) a regular dosage of medication that is required to be adjusted on a daily basis, includes time spent on activities that are directly related to the determination of the dosage of the medication, and

  • (ii) the daily consumption of a medical food or medical formula to limit intake of a particular compound to levels required for the proper development or functioning of the body, includes the time spent on activities that are directly related to the determination of the amount of the compound that can be safely consumed;

• (c) in the case of

  • (i) a child who is unable to perform the activities related to the administration of the therapy as a result of the child’s age, includes the time spent by another person to perform or supervise those activities for the child, and

  • (ii) an individual who is unable to perform the activities related to the administration of the therapy because of the effects of an impairment or impairments in physical or mental functions, includes the time required to be spent by another person to assist the individual in performing those activities; and

• (d) does not include time spent on

  • (i) activities (other than activities described in paragraph (b)) related to dietary or exercise restrictions or regimes,

  • (ii) travel time,

  • (iii) medical appointments (other than medical appointments to receive therapy or to determine the daily dosage of medication, medical food or medical formula),

  • (iv) shopping for medication, or

  • (v) recuperation after therapy (other than medically required recuperation).

Deeming

(1.‍2) Despite subsection (1.‍1), an individual who is diagnosed with type 1 diabetes mellitus is deemed to require therapy to be administered at least two times each week for a total duration averaging not less than 14 hours a week.

• (i) attention,

• (ii) concentration,

• (iii) memory,

• (iv) judgement,

• (v) perception of reality,

• (vi) problem solving,

• (vii) goal setting,

• (viii) regulation of behaviour and emotions,

• (ix) verbal and non-verbal comprehension, and

• (x) adaptive functioning;

COVID-19 — additional deemed payment

(3.‍001) An eligible individual in relation to a month specified for a taxation year who files a return of income for the taxation year is deemed to have paid during the specified month on account of their tax payable under this Part for the taxation year an amount determined by the formula

• (i) an individual shall not fail to qualify as a parent (within the meaning assigned by section 252) of another individual solely because of the receipt of a social assistance amount that is payable under a program of the Government of Canada, the government of a province or an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act) for the benefit of the other individual; (particulier admissible)

Receipt of social assistance

(1.‍2) For the purposes of applying the definitions eligible dependant and eligible individual in subsection (1) for a taxation year, an individual shall not fail to qualify as a parent (within the meaning assigned by section 252) of another individual solely because of the receipt of a social assistance amount that is payable under a program of the Government of Canada, the government of a province or an Indigenous governing body (as defined in section 2 of the Children’s Special Allowances Act) for the benefit of the other individual, unless the amount is a special allowance under the Children’s Special Allowances Act in respect of the other individual in the taxation year.

eligible individual, in relation to a month specified for a taxation year, means an individual (other than a trust) who

• (a) has, before the specified month, attained the age of 19 years; or

• (b) was, at any time before the specified month,

  • (i) a parent who resided with their child, or

  • (ii) married or in a common-law partnership. (particulier admissible)

qualified dependant, of an individual in relation to a month specified for a taxation year, means a person who at the beginning of the specified month

• (a) is the individual’s child or is dependent for support on the individual or on the individual’s cohabiting spouse or common-law partner;

• (b) resides with the individual;

• (c) is under the age of 19 years;

• (d) is not an eligible individual in relation to the specified month; and

• (e) is not a qualified relation of any individual in relation to the specified month.‍ (personne à charge admissible)

qualified relation, of an individual in relation to a month specified for a taxation year, means the person, if any, who, at the beginning of the specified month, is the individual’s cohabiting spouse or common-law partner. (proche admissible)

Persons not eligible or qualified

(2) Despite subsection (1), a person is not an eligible individual, is not a qualified relation and is not a qualified dependant, in relation to a month specified for a taxation year, if the person

• (a) died before the specified month;

• (b) is confined to a prison or similar institution for a period of at least 90 days that includes the first day of the specified month;

• (c) is at the beginning of the specified month a non-resident person, other than a non-resident person who

  • (i) is at that time the cohabiting spouse or common-law partner of a person who is deemed under subsection 250(1) to be resident in Canada throughout the taxation year that includes the first day of the specified month, and

  • (ii) was resident in Canada at any time before the specified month;

• (d) is at the beginning of the specified month a person described in paragraph 149(1)‍(a) or (b); or

• (e) is a person in respect of whom a special allowance under the Children’s Special Allowances Act is payable for the specified month.

Deemed payment on account of tax

(4) An eligible individual in relation to a month specified for a taxation year who files a return of income for the taxation year is deemed to have paid, during the specified month, on account of their tax payable under this Part for the taxation year, an amount equal to the amount, if any, determined by the formula

Shared-custody parent

(4.‍1) Despite subsection (4), if an eligible individual is a shared-custody parent (as defined in section 122.‍6, but the definition qualified dependent in that section having the meaning assigned by subsection (1)) in respect of one or more qualified dependants at the beginning of a month, the amount deemed by subsection (4) to have been paid during a specified month is equal to the amount determined by the formula

Months specified

(4.‍2) For the purposes of this section, the months specified for a taxation year are April, July and October of the immediately following taxation year and January of the second immediately following taxation year.

Authority to specify amounts

(5) The Minister of Finance may specify amounts for a province in relation to a month specified for a taxation year for the purposes of this section. If the Minister of Finance does not specify a particular amount that is relevant for the purposes of this section, that particular amount is deemed to be nil for the purpose of applying this section.

Deemed rebate in respect of fuel charges

(6) The amount deemed by this section to have been paid during a specified month on account of tax payable for a taxation year is deemed to have been paid during the specified month as a rebate in respect of charges levied under Part 1 of the Greenhouse Gas Pollution Pricing Act in respect of the relevant province.

Only one eligible individual

(7) If an individual is a qualified relation of another individual in relation to a month specified for a taxation year and both those individuals would be, but for this subsection, eligible individuals in relation to the specified month, only the individual that the Minister designates is the eligible individual in relation to the specified month.

Exception — qualified dependant

(8) If a person would, if this Act were read without reference to this subsection, be the qualified dependant of two or more individuals, in relation to a month specified for a taxation year,

• (a) the person is deemed to be a qualified dependant, in relation to that month, of the one of those individuals on whom those individuals agree;

• (b) in the absence of an agreement referred to in paragraph (a), the person is deemed to be, in relation to that month, a qualified dependant of the individuals, if any, who are, at the beginning of that month, eligible individuals (as defined in section 122.‍6, but the definition qualified dependant in that section having the meaning assigned by subsection (1)) in respect of that person; and

• (c) in any other case, the person is deemed to be, in relation to that month, a qualified dependant only of the individual that the Minister designates.

Notification to Minister

(8.‍1) An individual shall notify the Minister of the occurrence of any of the following events before the end of the month following the month in which the event occurs:

• (a) the individual ceases to be an eligible individual;

• (b) a person becomes or ceases to be the individual’s qualified relation; and

• (c) a person ceases to be a qualified dependant of the individual, otherwise than because of attaining the age of 19 years.

Definitions

125.‍2 (1) The following definitions apply in this section.

adjusted business income, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations.‍ (revenu rajusté tiré d’une entreprise)

cost of capital, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en capital)

cost of labour, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en main-d’œuvre)

zero-emission technology manufacturing profits, of a corporation for a taxation year, means the amount determined by the formula

ZETM cost of capital, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en capital de FTZE)

ZETM cost of labour, of a corporation for a taxation year, has the same meaning as in Part LII of the Income Tax Regulations. (coût en main-d’œuvre de FTZE)

Zero-emission technology manufacturing

(2) There may be deducted from the tax otherwise payable under this Part by a corporation for a taxation year the amount determined by the formula

COVID-19 — production commencement time

(1.‍1) The reference to “two years” in subparagraph (b)‍(iii) of the definition production commencement time in subsection (1) is to be read as a reference to “three years” in respect of film or video productions for which the labour expenditure of the corporation in respect of the production for the taxation year ending in 2020 or 2021 was greater than nil.

Extension of time by Minister

(16) For the purposes of determining whether an eligible entity is a qualifying entity, a qualifying recovery entity or a qualifying renter, the Minister may, at any time, extend the time for filing an application under this section.

• (b.‍01) an amount included under paragraph 56(1)‍(n) in computing the taxpayer’s income for a period in the year throughout which the taxpayer was resident in Canada in connection with a program that consists primarily of research and does not lead to a diploma from a college or a collège d’enseignement général et professionnel, or a bachelor, masters, doctoral or equivalent degree,

charitable purposes includes making qualifying disbursements; (fins de bienfaisance)

• (a.‍1) all the resources of which are devoted to charitable activities carried on by the organization itself or to making qualifying disbursements,

grantee organization includes a person, club, society, association or organization or prescribed entity, but does not include a qualified donee; (organisation donataire)

qualifying disbursement means a disbursement by a charity, by way of a gift or by otherwise making resources available,

• (a) subject to subsection (6.‍001), to a qualified donee, or

• (b) to a grantee organization, if

  • (i) the disbursement is in furtherance of a charitable purpose (determined without reference to the definition charitable purposes in this subsection) of the charity,

  • (ii) the charity ensures that the disbursement is exclusively applied to charitable activities in furtherance of a charitable purpose of the charity, and

  • (iii) the charity maintains documentation sufficient to demonstrate

    • (A) the purpose for which the disbursement is made, and

    • (B) that the disbursement is exclusively applied by the grantee organization to charitable activities in furtherance of a charitable purpose of the charity; (versement admissible)

• (b) fails to expend in any taxation year, on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, amounts the total of which is at least equal to the organization’s disbursement quota for that year; or

• (c) makes a disbursement, other than

  • (i) a disbursement made in the course of charitable activities carried on by it, or

  • (ii) a qualifying disbursement.

• (b) fails to expend in any taxation year, on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, amounts the total of which is at least equal to the foundation’s disbursement quota for that year;

• (b.‍1) makes a disbursement, other than

  • (i) a disbursement made in the course of charitable activities carried on by it, or

  • (ii) a qualifying disbursement;

• (b) fails to expend in any taxation year, on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, amounts the total of which is at least equal to the foundation’s disbursement quota for that year;

• (b.‍1) makes a disbursement, other than

  • (i) a disbursement made in the course of charitable activities carried on by it, or

  • (ii) a qualifying disbursement;

• (d) of a registered charity, if it has in a taxation year received a gift of property (other than a designated gift) from another registered charity with which it does not deal at arm’s length and it has expended, before the end of the next taxation year, in addition to its disbursement quota for each of those taxation years, an amount that is less than the fair market value of the property, on charitable activities carried on by it or by way of gifts that are qualified disbursements to qualified donees or grantee organizations, with which it deals at arm’s length;

Devotion of resources — charitable activity

(6) A charitable organization shall be considered to be devoting its resources to charitable activities carried on by it to the extent that it uses those resources in carrying on a related business.

Qualifying disbursement limit — charitable organizations

(6.‍001) In any taxation year, disbursements of income of a charitable organization by way of gifts to a qualified donee (other than disbursements of income to a registered charity that the Minister has designated in writing as a charity associated with the charitable organization) in excess of 50% of the charitable organization’s income for that year are not qualifying disbursements.

Rule regarding disbursement excess

(20) Where a registered charity has expended a disbursement excess for a taxation year, the charity may, for the purpose of determining whether it complies with the requirements of paragraph (2)‍(b), (3)‍(b) or (4)‍(b), as the case may be, for the immediately preceding taxation year of the charity and five or less of its immediately subsequent taxation years, include in the computation of the amounts expended on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements, such portion of that disbursement excess as was not so included under this subsection for any preceding taxation year.

Definition of disbursement excess

(21) For the purpose of subsection (20), disbursement excess, for a taxation year of a charity, means the amount, if any, by which the total of amounts expended in the year by the charity on charitable activities carried on by it and by way of gifts made by it that are qualifying disbursements exceeds its disbursement quota for the year.

• (d) if the Minister determines the amount deemed by subsection 122.‍5(3), (3.‍001) or 122.‍8(4) to have been paid by an individual for a taxation year to be nil, subsection (2) does not apply to the determination unless the individual requests a notice of determination from the Minister.

• (b) the taxpayer shall pay to the Receiver General interest at the prescribed rate on the excess (other than any portion thereof that can reasonably be considered to arise as a consequence of the operation of section 122.‍5, 122.‍61 or 122.‍8) from the day it became payable to the date of payment.

Liability for refund — Climate Action Incentive

(1.‍2) If a person is a qualified relation of an individual (within the meaning assigned by subsection 122.‍8(1)), in relation to one or more months specified for a taxation year, the person and the individual are jointly and severally, or solidarily, liable to pay the lesser of

• (a) any excess described in subsection (1) that was refunded in respect of the taxation year to, or applied to a liability of, the individual as a consequence of the operation of section 122.‍8; and

• (b) the total of the amounts deemed by subsection 122.‍8(4) to have been paid by the individual during those specified months.

Liability under other provisions

(2) Subsections (1.‍1) and (1.‍2) do not limit a person’s liability under any other provision of this Act.

Assessment

(3) The Minister may at any time assess a taxpayer in respect of any amount payable by the taxpayer because of any of subsections (1) to (1.‍2) or for which the taxpayer is liable because of subsection (2.‍1) or (2.‍2), and the provisions of this Division (including, for greater certainty, the provisions in respect of interest payable) apply, with any modifications that the circumstances require, in respect of an assessment made under this section, as though it were made under section 152 in respect of taxes payable under this Part, except that no interest is payable on an amount assessed in respect of an excess referred to in subsection (1) that can reasonably be considered to arise as a consequence of the operation of section 122.‍5, 122.‍61 or 122.‍8.

• (c.‍4) the amount, if any, by which

  • (i) the total of all amounts each of which is an amount that would be deemed by section 122.‍8 to be paid by that person during a month specified for the year or, where that person is the qualified relation of an individual in relation to that specified month (within the meaning assigned by subsection 122.‍8(1)), by that individual, if that total were calculated by reference to the information provided in the person’s return of income (within the meaning assigned by subsection 122.‍8(1)) for the year

• exceeds

  • (ii) the total of all amounts each of which is an amount that is deemed by section 122.‍8 to be paid by that person or by an individual of whom the person is the qualified relation in relation to a month specified for the year (within the meaning assigned by subsection 122.‍8(1)),

Application respecting refunds — Climate Action Incentive

(2.‍21) Where an amount deemed under section 122.‍8 to be paid by an individual during a month specified for a taxation year is applied under subsection (2) to a liability of the individual and the individual’s return of income for the year is filed on or before the individual’s balance-due day for the year, the amount is deemed to have been so applied on the day on which the amount would have been refunded if the individual were not liable to make a payment to Her Majesty in right of Canada.

Interest on refunds and repayments

(3) If, under this section, an amount in respect of a taxation year (other than an amount, or a portion of the amount, that can reasonably be considered to arise from the operation of section 122.‍5, 122.‍61, 122.‍8 or 125.‍7) is refunded or repaid to a taxpayer or applied to another liability of the taxpayer, the Minister shall pay or apply interest on it at the prescribed rate for the period that begins on the day that is the latest of the days referred to in the following paragraphs and that ends on the day on which the amount is refunded, repaid or applied:

• (f) in the case of a registered charity, registered Canadian amateur athletic association or registered journalism organization, accepts a gift the granting of which was expressly or implicitly conditional on the charity, association or organization making a gift to another person, club, society, association or organization other than a qualified donee.

Winding-up period

(1.‍2) In this Part, the winding-up period of a charity is the period

• (a) that begins immediately after the earliest of the days on which

  • (i) the Minister issues a notice of intention to revoke the registration of the charity under any of subsections 149.‍1(2) to (4.‍1) and 168(1),

  • (ii) the charity becomes a listed terrorist entity, and

  • (iii) it is determined, under subsection 7(1) of the Charities Registration (Security Information) Act, that a certificate served in respect of the charity under subsection 5(1) of that Act is reasonable on the basis of information and evidence available, and

• (b) that ends on the day that is the latest of

  • (i) the day, if any, on which the charity files a return under subsection 189(6.‍1) for the taxation year deemed by subsection (1) to have ended, but not later than the day on which the charity is required to file that return,

  • (ii) the day on which the Minister last issues a notice of assessment of tax payable under subsection (1.‍1) for that taxation year by the charity, and

  • (iii) if the charity has filed a notice of objection or appeal in respect of that assessment, the day on which the Minister may take a collection action under section 225.‍1 in respect of that tax payable.

• (c) a qualifying disbursement.

Gifts not at arm’s length

(12) If a registered charity has in a taxation year received a gift of property (other than a designated gift) from another registered charity with which it does not deal at arm’s length and it has expended, before the end of the next taxation year — in addition to its disbursement quota for each of those taxation years — an amount that is less than the fair market value of the property on charitable activities carried on by it or by way of gifts made by it that are qualifying disbursements to qualified donees or grantee organizations, with which it deals at arm’s length, the registered charity is liable to a penalty under this Act for that subsequent taxation year equal to 110% of the difference between the fair market value of the property and the additional amount expended.

• (xix) to an official of the Canada Revenue Agency solely for the purpose of the collection of amounts owing to Her Majesty in right of Canada under the Canada Emergency Business Account program established by Export Development Canada in accordance with an authorization made under subsection 23(1) of the Export Development Act;

• (x) to an official of the Canada Revenue Agency solely for the purpose of the collection of amounts owing to Her Majesty in right of Canada under the Canada Emergency Business Account program established by Export Development Canada in accordance with an authorization made under subsection 23(1) of the Export Development Act;

Indigenous governing body means an Indigenous governing body (as defined in section 1 of An Act respecting First Nations, Inuit and Métis children, youth and families) that

• (a) has given notice under subsection 20(1) of that Act;

• (b) has requested a coordination agreement under subsection 20(2) of that Act; or

• (c) meets prescribed conditions.‍ (corps dirigeant autochtone)

• (a) resides in an institution, a group foster home, the private home of foster parents or in the private home of a guardian, tutor or other individual occupying a similar role for the month, under a decree, order or judgment of a competent tribunal and is maintained by

  • (i) a department or agency of the government of Canada or a province, or

  • (ii) an agency appointed by a province, including an authority established under the laws of a province, or by an agency appointed by such an authority, for the purpose of administering any law of the province for the protection and care of children;

• (b) is maintained by an institution licensed or otherwise authorized under the law of the province to have the custody or care of children; or

• (c) resides in an institution, a group foster home, the private home of foster parents or in the private home of a guardian, tutor or other individual occupying a similar role for the month, under the laws of an Indigenous governing body and is maintained by

  • (i) the Indigenous governing body,

  • (ii) a department or agency of the Indigenous governing body, or

  • (iii) an agency appointed by the Indigenous governing body, including an authority established under the laws of the Indigenous governing body, or by an agency appointed by such an authority, for the purpose of administering any law of the Indigenous governing body for the protection and care of children.

• (a) an application therefor has been made in the prescribed manner by the department, agency, institution or Indigenous governing body referred to in subsection 3(1) that maintains the child; and

No allowance payable

(3) No special allowance is payable for the month in which the child in respect of whom the special allowance is payable commences to be maintained by a department, agency, institution or Indigenous governing body, and no special allowance is payable in respect of a child for the month in which the child is born or commences to reside in Canada.

• (a) ceases to be maintained by the department, agency, institution or Indigenous governing body;

Recipient of special allowance

5 Where payment of a special allowance is approved in respect of a child, the special allowance shall, in such manner and at such times as are determined by the Minister, be paid to the department, agency, institution or Indigenous governing body referred to in subsection 3(1) that maintains the child or, in the prescribed circumstances, to a foster parent.

Report

6 Where a special allowance ceases to be payable in respect of a child for a reason referred to in paragraph 4(4)‍(a), (b) or (c), the chief executive officer of the department, agency, institution or Indigenous governing body that made the application under paragraph 4(1)‍(a) in respect of the child shall, as soon as possible after the special allowance ceases to be payable in respect of the child, notify the Minister in the prescribed form and manner.

Return of special allowance

9 (1) Any person, department, agency, institution or Indigenous governing body that has received or obtained by cheque or otherwise payment of a special allowance under this Act to which the person, department, agency, institution or Indigenous governing body is not entitled, or payment in excess of the amount to which the person, department, agency, institution or Indigenous governing body is entitled, shall, as soon as possible, return the cheque or the amount of the payment, or the excess amount, as the case may be.

Recovery of amount of payment

(2) Where a person, department, agency, institution or Indigenous governing body has received or obtained payment of a special allowance under this Act to which the person, department, agency, institution or Indigenous governing body is not entitled, or payment in excess of the amount to which the person, department, agency, institution or Indigenous governing body is entitled, the amount of the special allowance or the amount of the excess, as the case may be, constitutes a debt due to Her Majesty.

Deduction from subsequent special allowance

(3) Where any person, department, agency, institution or Indigenous governing body has received or obtained payment of a special allowance under this Act to which the person, department, agency, institution or Indigenous governing body is not entitled, or payment in excess of the amount to which the person, department, agency, institution or Indigenous governing body is entitled, the amount of the special allowance or the amount of the excess, as the case may be, may be deducted and retained in such manner as is prescribed out of any special allowance to which the person, department, agency, institution or Indigenous governing body is or subsequently becomes entitled under this Act.

Agreements for exchange of information

11 The Minister may enter into an agreement with the government of any province, or an Indigenous governing body, for the purpose of obtaining information in connection with the administration or enforcement of this Act or the regulations and of furnishing to that government, or Indigenous governing body, under prescribed conditions, any information obtained by or on behalf of the Minister in the course of the administration or enforcement of this Act or the regulations, if the Minister is satisfied that the information to be furnished to that government, or Indigenous governing body, under the agreement is to be used for the purpose of the administration of a social program, income assistance program or health insurance program in the province or of the Indigenous governing body.

• (a) providing for the suspension of payment of a special allowance during any investigation respecting the eligibility of a department, agency, institution or Indigenous governing body to receive the special allowance and specifying the circumstances in which payment of a special allowance, the payment of which has been suspended, may be resumed;

• (c) specifying for the purposes of this Act the circumstances in which a child shall be considered to be maintained by a department, agency, institution or Indigenous governing body; and

• (xi) to an official of the Agency solely for the purpose of the collection of amounts owing to Her Majesty in right of Canada under the Canada Emergency Business Account program established by Export Development Canada in accordance with an authorization made under subsection 23(1) of the Export Development Act;

Immediate expensing

(0.‍1) For the purposes of paragraph 20(1)‍(a) of the Act, a deduction is allowed in computing an eligible person or partnership’s income for each taxation year equal to the lesser of

• (a) the eligible person or partnership’s immediate expensing limit for the taxation year,

• (b) the undepreciated capital cost to the eligible person or partnership as of the end of the taxation year (before making any deduction under this Part for the taxation year) of property that is designated immediate expensing property for the taxation year, and

• (c) if the eligible person or partnership is not a Canadian-controlled private corporation, the amount of income, if any, earned from the source of income that is a business or property (computed without regard to paragraph 20(1)‍(a) of the Act) in which the relevant designated immediate expensing property is used for the eligible person or partnership’s taxation year.

Undepreciated capital cost — immediate expensing

(0.‍2) Before computing any other deduction permitted under this Part and Schedules II to VI, the amount of any deduction made under subsection (0.‍1) by an eligible person or partnership in respect of a designated immediate expensing property of a prescribed class shall be deducted from the undepreciated capital cost of the particular class to which the property belongs.

Expenditures excluded from paragraph (0.‍1)‍(b)

(0.‍3) For the purposes of paragraph (0.‍1)‍(b), in respect of property of a class in Schedule II that is immediate expensing property of an eligible person or partnership solely because of subparagraph (c)‍(i) of the definition immediate expensing property in subsection 1104(3.‍1), amounts incurred by any person or partnership in respect of the property are not to be included in determining the undepreciated capital cost to the eligible person or partnership as of the end of the taxation year (before making any deduction under this Part for the taxation year) of property that is designated immediate expensing property for the taxation year if the amounts are incurred before April 19, 2021 (if the eligible person or partnership is a Canadian-controlled private corporation) or before 2022 (if the eligible person or partnership is an individual or Canadian partnership), unless

• (a) the property was acquired by an eligible person or partnership from another person or partnership (referred to in this paragraph as the “transferee” and the “transferor”, respectively)

  • (i) if the transferee is a Canadian-controlled private corporation, after April 18, 2021, or

  • (ii) if the transferee is an individual or a Canadian partnership, after December 31, 2021;

• (b) the transferee was either

  • (i) the eligible person or partnership, or

  • (ii) a person or partnership that does not deal at arm’s length with the eligible person or partnership; and

• (c) the transferor

  • (i) dealt at arm’s length with the transferee, and

  • (ii) held the property as inventory.

(1.‍1) Despite subsections (0.‍1), (1) and (3), the amount deductible by a taxpayer for a taxation year in respect of a property that is a specified leasing property at the end of the year is the lesser of

(1.‍12) Despite subsections (0.‍1), (1) and (1.‍1), where, in a taxation year, a taxpayer has acquired a property that was not used by the taxpayer for any purpose in that year and the first use of the property by the taxpayer is a lease of the property in respect of which subsection (1.‍1) applies, the amount allowed to the taxpayer under subsections (0.‍1) and (1) in respect of the property for the year shall be deemed to be nil.

(11) Despite subsections (0.‍1) and (1), in no case shall the aggregate of deductions, each of which is a deduction in respect of property of a prescribed class owned by a taxpayer that includes rental property owned by him, otherwise allowed to the taxpayer by virtue of subsection (0.‍1) or (1) in computing his income for a taxation year, exceed the amount, if any, by which

(15) Despite subsections (0.‍1) and (1), in no case shall the aggregate of deductions, each of which is a deduction in respect of property of a prescribed class that is leasing property owned by a taxpayer, otherwise allowed to the taxpayer under subsection (0.‍1) or (1) in computing his income for a taxation year, exceed the amount, if any, by which

(20.‍1) The total of all amounts each of which is a deduction in respect of computer tax shelter property allowed to the taxpayer under subsection (0.‍1) or (1) in computing a taxpayer’s income for a taxation year shall not exceed the amount, if any, by which

(21.‍1) Despite subsections (0.‍1) and (1), where a taxpayer has acquired property described in paragraph (s) of Class 10 in Schedule II, or in paragraph (m) of Class 12 of Schedule II, the deduction in respect of the property otherwise allowed to the taxpayer under subsection (0.‍1) or (1) in computing the taxpayer’s income for a taxation year shall not exceed the amount that it would be if the capital cost to the taxpayer of the property were reduced by the portion of any debt obligation of the taxpayer outstanding at the end of the year that is convertible into an interest or, for civil law, a right in the property or an interest in the taxpayer.

(24) Despite subsections (0.‍1) and (1), in no case shall the total of deductions, each of which is a deduction in respect of property of Class 34, 43.‍1, 43.‍2, 47 or 48 in Schedule II that is specified energy property owned by a taxpayer, otherwise allowed to the taxpayer under subsection (0.‍1) or (1) in computing the taxpayer’s income for a taxation year, exceed the amount, if any, by which

(20.‍1) For the purposes of subsections 1100(0.‍3) and (2.‍02) and 1104(3.‍1) and (4), a particular person or partnership and another person or partnership shall be considered not to be dealing at arm’s length with each other in respect of the acquisition or ownership of a property if, in the absence of this subsection, they would be considered to be dealing at arm’s length with each other and it may reasonably be considered that the principal purpose of any transaction or event, or a series of transactions or events, is to cause

• (a) the property to qualify as accelerated investment incentive property or immediate expensing property; or

• (b) the particular person or partnership and the other person or partnership to satisfy the condition in subclause 1100(2.‍02)‍(a)‍(i)‍(C)‍(I) or subparagraph 1100(0.‍3)‍(c)‍(i).

(2) Subsection (1) is deemed to have come into force on April 19, 2021.

Definitions

(3.‍1) The following definitions apply in this Part and Schedules II to VI.

designated immediate expensing property for a taxation year, means property of an eligible person or partnership that

• (a) is immediate expensing property of the eligible person or partnership;

• (b) became available for use by the eligible person or partnership in the taxation year; and

• (c) is designated as designated immediate expensing property in prescribed form filed by the eligible person or partnership with the Minister for the taxation year

  • (i) if the eligible person or partnership is a partnership, on or before the day that is 12 months after the day on which any member of the partnership is required to file an information return under section 229 for the fiscal period to which the designation relates, and

  • (ii) in any other case, on or before the day that is 12 months after the eligible person or partnership’s filing-due date for the taxation year to which the designation relates. (bien relatif à la passation en charges immédiate désigné)

eligible person or partnership for a taxation year, means

• (a) a corporation that was a Canadian-controlled private corporation throughout the year;

• (b) an individual (other than a trust) who was resident in Canada throughout the year; or

• (c) a Canadian partnership all of the members of which were, throughout the period, persons described in paragraph (a) or (b). (personne ou société de personnes admissible)

immediate expensing property for a taxation year, means property of a prescribed class (other than property included in any of Classes 1 to 6, 14.‍1, 17, 47, 49 and 51 in Schedule II) of an eligible person or partnership that

• (a) is acquired by the eligible person or partnership

  • (i) if the eligible person or partnership is a Canadian-controlled private corporation, after April 18, 2021, or

  • (ii) if the eligible person or partnership is an individual or a Canadian partnership, after Decem­ber 31, 2021;

• (b) becomes available for use

  • (i) if the eligible person or partnership is an individual or a Canadian partnership all the members of which are individuals throughout the taxation year, before 2025, and

  • (ii) in any other case, before 2024; and

• (c) meets either of the following conditions:

  • (i) the property

    • (A) has not been used for any purpose before it was acquired by the eligible person or partnership, and

    • (B) is not a property in respect of which an amount has been deducted under paragraph 20(1)‍(a) or subsection 20(16) of the Act by any person or partnership for a taxation year ending before the time the property was acquired by the eligible person or partnership, or

  • (ii) the property was not

    • (A) acquired in circumstances where

      • (I) the eligible person or partnership was deemed to have been allowed or deducted an amount under paragraph 20(1)‍(a) of the Act in respect of the property in computing income for previous taxation years, or

      • (II) the undepreciated capital cost of depreciable property of a prescribed class of the eligible person or partnership was reduced by an amount determined by reference to the amount by which the capital cost of the property to the eligible person or partnership exceeds its cost amount, or

    • (B) previously owned or acquired by the eligible person or partnership or by a person or partnership with which the eligible person or partnership did not deal at arm’s length at any time when the property was owned or acquired by the person or partnership. (bien relatif à la passation en charges immédiate)

taxpayer unless the context otherwise requires, includes an eligible person or partnership.‍ (contribuable)

Immediate expensing limit

(3.‍2) For the purposes of this Part and Schedules II to VI, an eligible person or partnership’s immediate expensing limit for a taxation year is $1,500,000 unless the eligible person or partnership is associated (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in the taxation year with one or more other eligible persons or partnerships, in which case, except as otherwise provided in this section, its immediate expensing limit is nil.

Associated eligible persons or partnerships

(3.‍3) Despite subsection (3.‍2), if all the eligible persons or partnerships that are associated with each other (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in a taxation year file with the Minister in prescribed form an agreement that assigns for the purpose of this Part and Schedules II to VI a percentage to one or more of them for the year, the immediate expensing limit for the year of each of the eligible persons or partnerships is

• (a) if the total of the percentages assigned in the agreement does not exceed 100%, $1,500,000 multiplied by the percentage assigned to that eligible person or partnership in the agreement; and

• (b) in any other case, nil.

Failure to file agreement

(3.‍4) If any of the eligible persons or partnerships that are associated with each other (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in a taxation year has failed to file with the Minister an agreement described in subsection (3.‍3) within 30 days after notice in writing by the Minister has been forwarded to any of them that such an agreement is required for the purpose of any assessment of tax under Part I of the Act, the Minister shall, for the purpose of this Part and Schedules II to VI, allocate an amount to one or more of them for the taxation year.

Special rules for immediate expensing limit

(3.‍5) Despite subsections (3.‍2) to (3.‍4),

• (a) where an eligible person or partnership (in this paragraph referred to as the “first person”) has more than one taxation year ending in the same calendar year and it is associated (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) in two or more of those taxation years with another eligible person or partnership (in this paragraph referred to as the “other person”) that has a taxation year ending in that calendar year, the immediate expensing limit of the first person for each taxation year ending in the calendar year in which it is associated (within the meaning of section 256 of the Act, as modified by subsection (3.‍6)) with the other person that ends after the first such taxation year ending in that calendar year is, subject to the application of paragraph (b), an amount equal to the lesser of

  • (i) its immediate expensing limit determined under subsection (3.‍3) or (3.‍4) for the first such taxation year ending in the calendar year, and

  • (ii) its immediate expensing limit determined under subsection (3.‍3) or (3.‍4) for the particular taxation year ending in the calendar year; and

• (b) where an eligible person or partnership has a taxation year that is less than 51 weeks, its immediate expensing limit for the year is that proportion of its immediate expensing limit for the year determined without reference to this paragraph that the number of days in the year is of 365.

Associated - interpretation

(3.‍6) For the purposes of this Part and Schedules II to VI, in determining whether an eligible person or partnership is associated (within the meaning of section 256 of the Act, as modified by this subsection) with another eligible person or partnership in a taxation year

• (a) if the eligible person or partnership is a partnership,

  • (i) the partnership is deemed to be a corporation (in this subsection referred to as a “deemed corporation”) for the year,

  • (ii) the deemed corporation is deemed to have a capital stock of a single class of shares, with a total of 100 issued and outstanding shares,

  • (iii) each member (in this subsection referred to as a “deemed shareholder”) of the deemed corporation is deemed to be a shareholder of the deemed corporation,

  • (iv) each deemed shareholder of the deemed corporation is deemed to hold a number of shares in the capital stock of the deemed corporation determined by the formula

    A × 100

    where

    A

    is equal to

    (A) the deemed shareholder’s specified proportion for the last fiscal period of the deemed corporation, or

    (B) if the deemed shareholder does not have a specified proportion described in clause (A), the proportion that the fair market value of the deemed shareholder’s interest in the deemed corporation at that time is of the fair market value of all interests in the deemed corporation at that time, and

  • (v) the deemed corporation’s fiscal period is deemed to be its taxation year; and

• (b) if the eligible person or partnership is an individual (other than a trust) who carries on a business or has acquired immediate expensing property

  • (i) the individual, in respect of that business or property, is deemed to be a corporation that is controlled by the individual, and

  • (ii) the corporation’s taxation year is deemed to be the same as the individual’s taxation year.

biogas means the gas produced by the anaerobic digestion of specified waste material.‍ (biogaz)

producer gas means

• (a) in respect of a property of a taxpayer that becomes available for use by the taxpayer before 2025, fuel the composition of which, excluding its water content, is all or substantially all non-condensable gases that is generated primarily from eligible waste fuel or specified waste material using a thermo-chemical conversion process and that is not generated from any feedstock other than eligible waste fuel, specified waste material or fossil fuel; and

• (b) in respect of a property of a taxpayer that becomes available for use by the taxpayer after 2024, fuel

  • (i) the composition of which, excluding its water content, is all or substantially all non-condensable gases,

  • (ii) that is generated using a thermo-chemical conversion process,

  • (iii) that is generated from feedstock of which no more than 25% is fossil fuel when measured in terms of energy content (expressed as a higher heating value of the feedstock), and

  • (iv) that is not generated from any feedstock other than eligible waste fuel, specified waste material or fossil fuel. (gaz de gazéification)

plant residue means residue of plants (not including wood waste and waste that no longer has the chemical properties of the plants of which it is a residue) that would otherwise be waste material. (résidus végétaux)

separated organics means organic waste (other than waste that is considered to be toxic or hazardous waste under any law of Canada or a province) that could be disposed of in an eligible waste management facility or eligible landfill site. (matières organiques séparées)

gaseous biofuel means a fuel produced all or substantially all from specified waste material that is a gas at a temperature of 15.‍6°C (60°F) and a pressure of 101 kPa (14.‍7 psia). (biocarburants gazeux)

liquid biofuel means a fuel produced all or substantially all from specified waste material or carbon dioxide that is a liquid at a temperature of 15.‍6°C (60°F) and a pressure of 101 kPa (14.‍7 psia). (biocarburants liquides)

solid biofuel means a fuel produced all or substantially all from specified waste material that is a solid at a temperature of 15.‍6°C (60°F) and a pressure of 101 kPa (14.‍7 psia) (other than charcoal that is used for cooking or fuels with fossil fuel-derived ignition accelerants) and that has undergone

• (a) a thermo-chemical conversion process to increase its carbon fraction and densification; or

• (b) densification into pellets or briquettes. (biocarburants solides)

specified waste material means wood waste, plant residue, municipal waste, sludge from an eligible sewage treatment facility, spent pulping liquor, food and animal waste, manure, pulp and paper by-product and separated organics. (déchets déterminés)

• (A) any of subparagraphs (d)‍(vii) to (ix), (xi), (xiii), (xiv), (xvi), (xvii) and (xix) to (xxii) of Class 43.‍1, or

COVID-19 — Application for a Certificate of Completion

(1.‍1) In respect of applications filed with the Minister of Canadian Heritage in respect of film or video productions for which the labour expenditure of the corporation in respect of the production for the taxation years ending in 2020 or 2021 was greater than nil, the definition application for a certificate of completion in subsection (1) is to be read as follows:

COVID-19 — Excluded Production

(1.‍2) The reference to “2-year period” in subparagraph (a)‍(iv) of the definition excluded production in subsection (1) is to be read as a reference to “three-year period” in respect of film or video productions for which the labour expenditure of the corporation in respect of the production for the taxation years ending in 2020 or 2021 was greater than nil.

Information Returns

3703 For the purpose of subsection 149.‍1(14) of the Act, the following is prescribed information for the public information return of a charity in a taxation year:

• (a) in respect of each grantee organization that received total qualifying disbursements from the charity in excess of $5,000 in the taxation year, the name of the grantee organization;

• (b) the purpose of each qualifying disbursement made to a grantee organization referred to in paragraph (a) in the taxation year; and

• (c) the total amount disbursed by the charity to each grantee organization referred to in paragraph (a) in the taxation year.

qualified zero-emission technology manufacturing activities means

• (a) qualified activities that are

  • (i) performed in connection with the manufacturing or processing of

    • (A) solar energy conversion equipment, including solar thermal collectors, photovoltaic solar arrays and custom supporting structures or frames, but excluding passive solar heating equipment,

    • (B) wind energy conversion equipment, including wind turbine towers, nacelles and rotor blades,

    • (C) water energy conversion equipment, including hydroelectric, water current, tidal and wave energy conversion equipment,

    • (D) geothermal energy equipment,

    • (E) equipment for a ground source heat pump system,

    • (F) electrical energy storage equipment used for storage of renewable energy or for providing grid-scale storage or other ancillary services, including battery, compressed air and flywheel storage systems,

    • (G) equipment used to charge, or to dispense hydrogen to, property included in clause (J),

    • (H) equipment used for the production of hydrogen by electrolysis of water,

    • (I) equipment that is a component of property included in clauses (A) to (H), if such equipment is purpose-built or designed exclusively to form an integral part of that property,

    • (J) property that

      • (I) would be a zero-emission vehicle (as defined in subsection 248(1) of the Act if that definition were read without reference to its paragraphs (b) and (c)), or

      • (II) is described in subparagraph (a)‍(i) of Class 56 of Schedule II, and

    • (K) integral components of the powertrain of property included in clause (J), including batteries or fuel cells, and

  • (ii) not the manufacturing or processing of general purpose components or equipment which components or equipment are suitable for integration into property other than property described in subparagraph (i);

• (b) qualified activities that are performed in connection with production in Canada of

  • (i) hydrogen by electrolysis of water,

  • (ii) gaseous biofuel (as defined in subsection 1104(13)),

  • (iii) liquid biofuel (as defined in subsection 1104(13)), and

  • (iv) solid biofuel (as defined in subsection 1104(13)); and

• (c) the conversion of a vehicle, performed in Canada, into a property described in clause (a)‍(i)‍(J); (activités admissibles de fabrication de technologies à zéro émission)

ZETM cost of capital, of a corporation for a taxation year, means the portion of the cost of capital of the corporation for the year that reflects the extent to which each property included in the calculation of the cost of capital was used directly in qualified zero-emission technology manufacturing activities of the corporation during the year; (coût en capital de FTZE)

ZETM cost of labour, of a corporation for a taxation year, means the portion of the cost of labour of the corporation for that year that reflects the extent to which  

• (a) the salaries and wages included in the calculation of the cost of labour were paid or payable to persons for the portion of their time that they were directly engaged in qualified zero-emission technology manufacturing activities of the corporation during the year, and

• (b) the other amounts included in the calculation of the cost of labour were paid or payable to persons for the performance of functions that would be directly related to qualified zero-emission technology manufacturing activities of the corporation during the year if those persons were employees of the corporation; (coût en main-d’œuvre de FTZE)

5204 If a corporation is a member of a partnership at any time in a taxation year of the corporation, the following definitions apply:

ZETM cost of capital, of the corporation for the year, means the portion of the cost of capital of the corporation for that year that reflects the extent to which each property included in the calculation of the cost of capital was used directly in qualified zero-emission technology manufacturing activities 

• (a) of the corporation during the year, or

• (b) of the partnership during its fiscal period coinciding with or ending in the year, as the case may be; (coût en capital de FTZE)

ZETM cost of labour, of the corporation for the year, means the portion of the cost of labour of the corporation for that year that reflects the extent to which

• (a) the salaries and wages included in the calculation of the cost of labour were paid or payable to persons for the portion of their time that they were directly engaged in qualified zero-emission technology manufacturing activities

  • (i) of the corporation during the year, or

  • (ii) of the partnership during its fiscal period coinciding with or ending in the year, and

• (b) the other amounts included in the calculation of the cost of labour were paid or payable to persons for the performance of functions that would be directly related to qualified zero-emission technology manufacturing activities of the corporation during the year, or of the partnership during its fiscal period coinciding with or ending in the year, if those persons were employees of the corporation or the partnership, as the case may be; (coût en main-d’œuvre de FTZE)

(1.‍1) The references to “24 months” in paragraphs 9300(1)‍(a) and (b) are to be read as references to “36 months” in respect of film or video productions for which the Canadian labour expenditure of the corporation in respect of the production for the taxation years ending in 2020 or 2021 was greater than nil.

• (i) part of a system that

  • (A) is used by the taxpayer, or by a lessee of the taxpayer, to generate electrical energy, or both electrical and heat energy, using only fuel that is eligible waste fuel, fossil fuel, producer gas, spent pulping liquor or any combination of those fuels,

  • (B) if the system is rated to generate more than three megawatts of electrical energy, meets the following condition on an annual basis:

    A ≥ (2 × B + C)/(D + E/3412)

    where

    A

    is 11,000 BTU per kilowatt-hour,

    B

    is the energy content of fossil fuel other than solution gas (expressed as the higher heating value of the fuel) consumed by the system in BTU,

    C

    is the energy content of the eligible waste fuel, producer gas and spent pulping liquor (expressed as the higher heating value of the fuel) consumed by the system in BTU,

    D

    is the gross electrical energy produced by the system in kilowatt-hours, and

    E

    is the net useful energy in the form of heat exported from the system to a thermal host in BTU, and

  • (C) uses fuel of which no more than 25% of the energy content (expressed as the higher heating value of the fuel) is from fossil fuel, as determined on an annual basis, or

• (B) it is not a building, part of a building (other than a solar collector that is not a window and that is integrated into a building), energy equipment that backs up equipment described in subclause (A)‍(I) or (II) nor equipment that distributes heated or cooled air or water in a building,

• (iv) heat recovery equipment used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of conserving energy, reducing the requirement to acquire energy or extracting heat for sale, by extracting for reuse thermal waste that is generated directly in an industrial process (other than an industrial process that generates or processes electrical energy), including such equipment that consists of heat exchange equipment, compressors used to upgrade low pressure steam, vapour or gas, waste heat boilers and other ancillary equipment such as control panels, fans, instruments or pumps, but not including property that is employed in re-using the recovered heat (such as property that is part of the internal heating or cooling system of a building or electrical generating equipment) or is a building,

• (vii) equipment used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating electrical energy or heat energy, or both electrical and heat energy, solely from geothermal energy, including such equipment that consists of piping (including above or below ground piping and the cost of completing a well (including the wellhead and production string), or trenching, for the purpose of installing that piping), pumps, heat exchangers, steam separators, electrical generating equipment and ancillary equipment used to collect the geothermal heat, but not including buildings, distribution equipment, equipment described in subclause (i)‍(A)‍(II), property otherwise included in Class 10 and property that would be included in Class 17 if that Class were read without reference to its paragraph (a.‍1),

• (ix) equipment that

  • (A) is used by the taxpayer, or by a lessee of the taxpayer, for the sole purpose of generating heat energy, not using any fuel other than eligible waste fuel, fossil fuel, producer gas or a combination of those fuels,

  • (B) uses fuel of which no more than 25% of the energy content (expressed as the higher heating value of the fuel) is from fossil fuel, as determined on an annual basis,

  • (C) may include

    • (I) fuel handling equipment used to upgrade the combustible portion of the fuel,

    • (II) control, feedwater and condensate systems, and

    • (III) other ancillary equipment, and

  • (D) does not include

    • (I) equipment used for the purpose of producing heat energy to operate electrical generating equipment,

    • (II) buildings or other structures,

    • (III) heat rejection equipment (such as condensers and cooling water systems),

    • (IV) fuel storage facilities,

    • (V) other fuel handling equipment, and

    • (VI) property otherwise included in Class 10 or 17,

• (xi) equipment all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to produce liquid biofuel, including storage, materials handling and ash-handling equipment and equipment used to remove non-combustibles and contaminants from the fuels produced, but not including

  • (A) equipment used to produce spent pulping liquor,

  • (B) equipment used for the collection or transportation of specified waste material or carbon dioxide,

  • (C) equipment used for the transmission or distribution of liquid biofuel,

  • (D) property that would otherwise be included in Class 17,

  • (E) automotive vehicles, and

  • (F) buildings or other structures,

• (xii) fixed location fuel cell equipment used by the taxpayer, or by a lessee of the taxpayer, that uses hydrogen generated only from ancillary electrolysis equipment (or, if the fuel cell is reversible, the fuel cell itself) using electricity all or substantially all of which is generated by using kinetic energy of flowing water or wave or tidal energy or by geothermal, photovoltaic, wind energy conversion, or hydro-electric equipment, of the taxpayer or the lessee, and equipment ancillary to the fuel cell equipment other than buildings or other structures, transmission equipment, distribution equipment, auxiliary electrical generating equipment and property otherwise included in Class 10 or 17,

• (xiv) property that is used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating electricity using kinetic energy of flowing water or wave or tidal energy, including support structures, control and conditioning equipment, submerged cables and transmission equipment, but not including buildings, distribution equipment, auxiliary electricity generating equipment, property otherwise included in Class 10 and property that would be included in Class 17 if that class were read without reference to its subparagraph (a.‍1)‍(i),

• (xvi) equipment used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating producer gas (other than producer gas that is to be converted into liquid fuels or chemicals), including related piping (including fans and compressors), air separation equipment, storage equipment, equipment used for drying or shredding feedstock, ash-handling equipment, equipment used to upgrade the producer gas into biomethane and equipment used to remove non-combustibles and contaminants from the producer gas, but not including, buildings or other structures, heat rejection equipment (such as condensers and cooling water systems), equipment used to convert producer gas into liquid fuels or chemicals, and property otherwise included in Class 10 or 17,

• (xvi) equipment that

  • (A) is used by the taxpayer, or by a lessee of the taxpayer, primarily for the purpose of generating producer gas (other than producer gas that is to be converted into liquid fuels or chemicals),

  • (B) uses feedstock of which no more than 25% of the energy content (expressed as the higher heating value of the feedstock) is from fossil fuel, as determined on an annual basis,

  • (C) may include

    • (I) related piping (including fans and compressors),

    • (II) air separation equipment,

    • (III) storage equipment,

    • (IV) equipment used for drying or shredding feedstock,

    • (V) ash-handling equipment,

    • (VI) equipment used to upgrade the producer gas into biomethane, and

    • (VII) equipment used to remove non-combustibles and contaminants from the producer gas, and

  • (D) does not include

    • (I) buildings or other structures,

    • (II) heat rejection equipment (such as condensers and cooling water systems),

    • (III) equipment used to convert producer gas into liquid fuels or chemicals, and

    • (IV) property otherwise included in Class 10 or 17,

• (xix) a pumped hydroelectric energy storage installation all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to store electrical energy including reversing turbines, transmission equipment, dams, reservoirs and related structures, and that meets the condition in either subclause (d)‍(xviii)‍(B)‍(I) or (II) in this Class, but not including

  • (A) property used solely for backup electrical energy, and

  • (B) buildings,

• (xx) equipment all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to produce solid biofuel, including storage, materials handling and ash-handling equipment, but not including

  • (A) equipment used to make wood chips, hog fuel or black liquor,

  • (B) property that would otherwise be included in Class 17,

  • (C) automotive vehicles, and

  • (D) buildings and other structures,

• (xxi) equipment used by the taxpayer, or by a lessee of the taxpayer, to dispense hydrogen for use in automotive equipment powered by hydrogen, including vaporization, compression, cooling and storage equipment, but not including

  • (A) equipment used for the production or transmission of hydrogen,

  • (B) equipment used for the transmission or distribution of electricity,

  • (C) automotive vehicles,

  • (D) auxiliary electrical generating equipment, and

  • (E) buildings and other structures, or

• (xxii) equipment all or substantially all of the use of which by the taxpayer, or by a lessee of the taxpayer, is to produce hydrogen through electrolysis of water, including electrolysers, rectifiers and other ancillary electrical equipment, water treatment and conditioning equipment and equipment used for hydrogen compression and storage, but not including

  • (A) equipment used for the transmission or distribution of hydrogen,

  • (B) equipment used for the transmission or distribution of electricity,

  • (C) automotive vehicles,

  • (D) auxiliary electrical generating equipment, and

  • (E) buildings and other structures, and