I-3 - Taxation Act

Section 21.43 Disposition versions

2009-06-04

21.43. A qualifying trust annuity with respect to a taxpayer means

(a)  an annuity in respect of which the following conditions are met:

i.  it is acquired after 31 December 2005,

ii.  the annuitant is a trust that is, at the time the annuity is acquired, a lifetime benefit trust with respect to the taxpayer and the succession of an individual,

iii.  it is for the life of the taxpayer (with or without a guaranteed period), or for a fixed term equal to 90 years minus the age in whole years of the taxpayer at the time it is acquired, and

iv.  if it is with a guaranteed period or for a fixed term, it requires that, in the event of the death of the taxpayer during the guaranteed period or fixed term, any amounts that would otherwise be payable after the death of the taxpayer be commuted into a single payment;

(b)  an annuity in respect of which the following conditions are met:

i.  it is acquired after 31 December 1988,

ii.  the annuitant is a trust under which the taxpayer is the sole person beneficially interested (determined without regard to any right of a person to receive an amount from the trust only on or after the death of the taxpayer) in amounts payable under the annuity,

iii.  it is for a fixed term not exceeding 18 years minus the age in whole years of the taxpayer at the time it is acquired, and

iv.  if it is acquired after 31 December 2005, it requires that, in the event of the death of the taxpayer during the fixed term, any amounts that would otherwise be payable after the death of the taxpayer be commuted into a single payment; and

(c)  an annuity in respect of which the following conditions are met:

i.  it is acquired after 31 December 2000 and before 1 January 2005 at a time at which the taxpayer was mentally or physically infirm, or in the year 2005 at a time at which the taxpayer was mentally infirm,

ii.  the annuitant is a trust under which the taxpayer is the sole person beneficially interested (determined without regard to any right of a person to receive an amount from the trust only on or after the death of the taxpayer) in amounts payable under the annuity, and

iii.  it is for the life of the taxpayer (with or without a guaranteed period), or for a fixed term equal to 90 years minus the age in whole years of the taxpayer at the time it is acquired.

For the purposes of the first paragraph, a trust is at a particular time a lifetime benefit trust with respect to a taxpayer and the succession of an individual if

(a)  immediately before the death of the individual, the taxpayer

i.  was both a spouse of the individual and mentally infirm, or

ii.  was both a child or grandchild of the individual and dependent on the individual for support because of mental infirmity; and

(b)  the trust is, at the particular time, a personal trust under which

i.  no person other than the taxpayer may receive or otherwise obtain the enjoyment of, during the taxpayer’s lifetime, all or part of the income or capital of the trust, and

ii.  the trustees are empowered to pay amounts from the trust to the taxpayer, and are required—in determining whether to pay, or not to pay, an amount to the taxpayer—to consider the needs of the taxpayer, including the comfort, care and maintenance of the taxpayer.

2009, c. 15, s. 32.