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I-3, r. 1 - Regulation respecting the Taxation Act
Section 840r1
Disposition versions
840R1. In this chapter,
“amount payable” has the meaning assigned by subparagraph j of the first paragraph of section 835 of the Act;
“benefit”, in respect of a policy, includes a policy dividend, other than a policy dividend in respect of a policy described in paragraph a of section 840R23, in respect of the policy to the extent that the dividend was specifically treated as a benefit by the insurer in determining a premium for the policy, and an expense of maintaining the policy after all premiums in respect of the policy have been paid to the extent that the expense was specifically provided for by the insurer in determining a premium for the policy, but does not include
(a) a policy loan;
(b) interest on funds left on deposit with the insurer under the terms of the policy; and
(c) any other amount under the policy that was not specifically provided for by the insurer in determining a premium for the policy;
“capital tax” means a tax imposed under Part I.3 or VI of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.) or a similar tax imposed under a law of a province;
“cash surrender value” has the meaning assigned by paragraph d of section 966 of the Act;
“contractual service margin” for a group of insurance contracts of an insurer, or a group of reinsurance contracts held by an insurer, at the end of a taxation year has the meaning assigned by subparagraph z of the first paragraph of section 835 of the Act;
“deposit accounting insurance policy” has the meaning assigned by subparagraph p of the first paragraph of section 835 of the Act;
“group of life insurance contracts in Canada” of an insurer has the meaning assigned by subparagraph w of the first paragraph of section 835 of the Act;
“group of reinsurance contracts” held by an insurer has the meaning assigned by subparagraph x of the first paragraph of section 835 of the Act;
“group of segregated fund policies” of an insurer has the meaning assigned by subparagraph y of the first paragraph of section 835 of the Act;
“interest” has the meaning assigned by subparagraph i of the first paragraph of section 835 of the Act;
“lapse-supported policy” means a life insurance policy that would require materially greater premiums if premiums were determined using policy lapse rates that are 0 from the 6th policy year;
“liability for incurred claims” for a group of insurance contracts of an insurer at the end of a taxation year has the meaning assigned by subparagraph z.4 of the first paragraph of section 835 of the Act;
“liability for remaining coverage” for a group of insurance contracts of an insurer at the end of a taxation year has the meaning assigned by subparagraph z.3 of the first paragraph of section 835 of the Act;
“non-cancellable or guaranteed renewable accident and sickness policy” includes a non-cancellable or guaranteed renewable accident and sickness benefit under a group policy;
“participating life insurance policy” has the meaning assigned by subparagraph f of the first paragraph of section 835 of the Act;
“policy loan” has the meaning assigned by subparagraph h of the first paragraph of section 835 of the Act;
“qualified annuity” means a contract, other than a deposit administration fund policy or a policy in respect of which section 628.8 of the former Regulation, within the meaning of section 2000R2, applied, as that section 628.8 read for the purposes of its application to the taxation year 1977 of the insurer, that is an annuity contract issued before 1 January 1982
(a) in respect of which regular periodic annuity payments have commenced;
(b) in respect of which a contract or certificate has been issued that provides for regular periodic annuity payments to commence within 1 year after the date of issue of the contract or certificate;
(c) that
i. is not issued as or under a registered retirement savings plan, registered pension plan or deferred profit sharing plan,
ii. does not provide for a guaranteed cash surrender value at any time, and
iii. provides for regular periodic annuity payments to commence not later than the attainment of age 71 by the annuitant; or
(d) that
i. is issued as or under a registered retirement savings plan, registered pension plan or deferred profit sharing plan, if
ii. the interest rate is guaranteed for at least 10 years, and
iii. the plan does not provide for any participation in profits, directly or indirectly;
“reinsurance contract held amount” for a group of reinsurance contracts held by an insurer at the end of a taxation year has the meaning assigned by subparagraph z.1 of the first paragraph of section 835 of the Act;
“reinsurance recoverable amount” means the amount reported as a reinsurance asset of an insurer at the end of a taxation year in respect of an amount recoverable from a reinsurer;
“segregated fund” has the meaning assigned by subparagraph b of the first paragraph of section 835 of the Act;
“segregated fund policy” has the meaning assigned by subparagraph g of the first paragraph of section 835 of the Act;
“Superintendent of Financial Institutions” has the meaning assigned by subparagraph z.5 of the first paragraph of section 835 of the Act.
840R1. In this chapter,
“amount payable” has the meaning assigned by subparagraph j of the first paragraph of section 835 of the Act;
“benefit”, in respect of a policy, includes a policy dividend, other than a policy dividend in respect of a policy described in paragraph a of section 840R23, in respect of the policy to the extent that the dividend was specifically treated as a benefit by the insurer in determining a premium for the policy, and an expense of maintaining the policy after all premiums in respect of the policy have been paid to the extent that the expense was specifically provided for by the insurer in determining a premium for the policy, but does not include
(a) a policy loan;
(b) interest on funds left on deposit with the insurer under the terms of the policy; and
(c) any other amount under the policy that was not specifically provided for by the insurer in determining a premium for the policy;
“capital tax” means a tax imposed under Part I.3 or VI of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.) or a similar tax imposed under a law of a province;
“cash surrender value” has the meaning assigned by paragraph d of section 966 of the Act;
«deposit accounting insurance policy» has the meaning assigned by subparagraph p of the first paragraph of section 835 of the Act;
“general amending provision” of an insurance policy means a provision of the policy that allows it to be amended with the consent of the policyholder;
“interest” has the meaning assigned by subparagraph i of the first paragraph of section 835 of the Act;
“lapse-supported policy” means a life insurance policy that would require materially greater premiums if premiums were determined using policy lapse rates that are 0 from the 6th policy year;
“modified net premium”, in respect of a premium under a policy, other than a prepaid premium under a policy that may be refunded only on termination of the policy, means
(a) where all benefits, other than policy dividends, and premiums, other than the frequency of payment of premiums, in respect of the policy are determined at the date of issue of the policy, the amount determined under section 840R2; or
(b) where paragraph a does not apply, the amount that would be determined under paragraph a if that paragraph applied and the amount were adjusted in a manner that is reasonable in the circumstances;
“non-cancellable or guaranteed renewable accident and sickness policy” includes a non-cancellable or guaranteed renewable accident and sickness benefit under a group policy;
“participating life insurance policy” has the meaning assigned by subparagraph f of the first paragraph of section 835 of the Act;
“policy liability” of an insurer at the end of a taxation year in respect of an insurance policy or a claim, possible claim or risk under an insurance policy means the positive or negative amount of the insurer’s reserve in respect of its potential liability in respect of the policy, claim, possible claim or risk at the end of the year determined in accordance with accepted actuarial practice, but without reference to projected income and capital taxes, other than the tax payable under Part XII.3 of the Income Tax Act;
“policy loan” has the meaning assigned by subparagraph h of the first paragraph of section 835 of the Act;
“post-1995 life insurance policy” means a life insurance policy that is not a pre-1996 life insurance policy;
“post-1995 non-cancellable or guaranteed renewable accident and sickness policy” means a non-cancellable or guaranteed renewable accident and sickness policy that is not a pre-1996 non-cancellable or guaranteed renewable accident and sickness policy;
“pre-1996 life insurance policy”, at a particular time, means a life insurance policy where
(a) the policy was issued before 1 January 1996; and
(b) after 31 December 1995 and before the particular time there has been no change, except in accordance with the provisions, other than a general amending provision, of the policy as they existed on 31 December 1995, to
i. the amount of any benefit under the policy,
ii. the amount of any premium or other amount payable under the policy, or
iii. the number of premiums or other payments under the policy;
“pre-1996 non-cancellable or guaranteed renewable accident and sickness policy”, at a particular time, means a non-cancellable or guaranteed renewable accident and sickness policy where
(a) the policy was issued before 1 January 1996; and
(b) after 31 December 1995 and before the particular time there has been no change, except in accordance with the provisions, other than a general amending provision, of the policy as they existed on 31 December 1995, to
i. the amount of any benefit under the policy,
ii. the amount of any premium or other amount payable under the policy, or
iii. the number of premiums or other payments under the policy;
“qualified annuity” means a contract, other than a deposit administration fund policy or a policy in respect of which section 628.8 of the former Regulation, within the meaning of section 2000R2, applied, as that section 628.8 read for the purposes of its application to the taxation year 1977 of the insurer, that is an annuity contract issued before 1 January 1982
(a) in respect of which regular periodic annuity payments have commenced;
(b) in respect of which a contract or certificate has been issued that provides for regular periodic annuity payments to commence within 1 year after the date of issue of the contract or certificate;
(c) that
i. is not issued as or under a registered retirement savings plan, registered pension plan or deferred profit sharing plan,
ii. does not provide for a guaranteed cash surrender value at any time, and
iii. provides for regular periodic annuity payments to commence not later than the attainment of age 71 by the annuitant; or
(d) that
i. is issued as or under a registered retirement savings plan, registered pension plan or deferred profit sharing plan, if
ii. the interest rate is guaranteed for at least 10 years, and
iii. the plan does not provide for any participation in profits, directly or indirectly;
“reinsurance recoverable amount” means the amount reported as a reinsurance asset of an insurer at the end of a taxation year in respect of an amount recoverable from a reinsurer;
“reported reserve” of an insurer at the end of a taxation year in respect of an insurance policy or a claim, possible claim, risk, dividend, premium, refund of premiums or refund of premium deposits under an insurance policy means
(a) where the insurer is required to file an annual report with the Superintendent of Financial Institutions for a period ending coincidentally with the year, the positive or negative amount of the reserve that would be reported in that report in respect of the insurer’s potential liability under the policy if the reserve were determined without reference to projected income and capital taxes, other than tax payable under Part XII.3 of the Income Tax Act;
(b) where the insurer is, throughout the year, subject to the supervision of the Superintendent of Financial Institutions and paragraph a does not apply, the positive or negative amount of the reserve that would be reported in its financial statements for the year in respect of the insurer’s potential liability under the policy if those financial statements were prepared in accordance with generally accepted accounting principles and the reserve were determined without reference to projected income and capital taxes, other than the tax payable under Part XII.3 of the Income Tax Act;
(c) where the insurer is the Canada Mortgage and Housing Corporation or a foreign affiliate of a taxpayer resident in Canada, the positive or negative amount of the reserve that would be reported in its financial statements for the year in respect of the insurer’s potential liability under the policy if those financial statements were prepared in accordance with generally accepted accounting principles and the reserve were determined without reference to projected income and capital taxes, other than the tax payable under Part XII.3 of the Income Tax Act; and
(d) in any other case, nil;
“segregated fund” has the meaning assigned by subparagraph b of the first paragraph of section 835 of the Act;
“segregated fund policy” has the meaning assigned by subparagraph g of the first paragraph of section 835 of the Act;
“Superintendent of Financial Institutions”, in respect of an insurer, means
(a) the Superintendent of Financial Institutions of Canada, where the insurer is required by law to report to the Superintendent; or
(b) in any other case, where the insurer is incorporated under the laws of Québec, the Autorité des marchés financiers or where the insurer is incorporated under the laws of another province, the Superintendent of Insurance or other similar agent or authority of the other province.
840R1. In this chapter,
“amount payable” has the meaning assigned by subparagraph j of the first paragraph of section 835 of the Act;
“benefit”, in respect of a policy, includes a policy dividend, other than a policy dividend in respect of a policy described in paragraph a of section 840R23, in respect of the policy to the extent that the dividend was specifically treated as a benefit by the insurer in determining a premium for the policy, and an expense of maintaining the policy after all premiums in respect of the policy have been paid to the extent that the expense was specifically provided for by the insurer in determining a premium for the policy, but does not include
(a) a policy loan;
(b) interest on funds left on deposit with the insurer under the terms of the policy; and
(c) any other amount under the policy that was not specifically provided for by the insurer in determining a premium for the policy;
“capital tax” means a tax imposed under Part I.3 or VI of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.) or a similar tax imposed under a law of a province;
“cash surrender value” has the meaning assigned by paragraph d of section 966 of the Act;
“general amending provision” of an insurance policy means a provision of the policy that allows it to be amended with the consent of the policyholder;
“interest” has the meaning assigned by subparagraph i of the first paragraph of section 835 of the Act;
“lapse-supported policy” means a life insurance policy that would require materially greater premiums if premiums were determined using policy lapse rates that are 0 from the 6th policy year;
“modified net premium”, in respect of a premium under a policy, other than a prepaid premium under a policy that may be refunded only on termination of the policy, means
(a) where all benefits, other than policy dividends, and premiums, other than the frequency of payment of premiums, in respect of the policy are determined at the date of issue of the policy, the amount determined under section 840R2; or
(b) where paragraph a does not apply, the amount that would be determined under paragraph a if that paragraph applied and the amount were adjusted in a manner that is reasonable in the circumstances;
“non-cancellable or guaranteed renewable accident and sickness policy” includes a non-cancellable or guaranteed renewable accident and sickness benefit under a group policy;
“participating life insurance policy” has the meaning assigned by subparagraph f of the first paragraph of section 835 of the Act;
“policy liability” of an insurer at the end of a taxation year in respect of an insurance policy or a claim, possible claim or risk under an insurance policy means the positive or negative amount of the insurer’s reserve in respect of its potential liability in respect of the policy, claim, possible claim or risk at the end of the year determined in accordance with accepted actuarial practice, but without reference to projected income and capital taxes, other than the tax payable under Part XII.3 of the Income Tax Act;
“policy loan” has the meaning assigned by subparagraph h of the first paragraph of section 835 of the Act;
“post-1995 life insurance policy” means a life insurance policy that is not a pre-1996 life insurance policy;
“post-1995 non-cancellable or guaranteed renewable accident and sickness policy” means a non-cancellable or guaranteed renewable accident and sickness policy that is not a pre-1996 non-cancellable or guaranteed renewable accident and sickness policy;
“pre-1996 life insurance policy”, at a particular time, means a life insurance policy where
(a) the policy was issued before 1 January 1996; and
(b) after 31 December 1995 and before the particular time there has been no change, except in accordance with the provisions, other than a general amending provision, of the policy as they existed on 31 December 1995, to
i. the amount of any benefit under the policy,
ii. the amount of any premium or other amount payable under the policy, or
iii. the number of premiums or other payments under the policy;
“pre-1996 non-cancellable or guaranteed renewable accident and sickness policy”, at a particular time, means a non-cancellable or guaranteed renewable accident and sickness policy where
(a) the policy was issued before 1 January 1996; and
(b) after 31 December 1995 and before the particular time there has been no change, except in accordance with the provisions, other than a general amending provision, of the policy as they existed on 31 December 1995, to
i. the amount of any benefit under the policy,
ii. the amount of any premium or other amount payable under the policy, or
iii. the number of premiums or other payments under the policy;
“qualified annuity” means a contract, other than a deposit administration fund policy or a policy in respect of which section 628.8 of the former Regulation, within the meaning of section 2000R2, applied, as that section 628.8 read for the purposes of its application to the taxation year 1977 of the insurer, that is an annuity contract issued before 1 January 1982
(a) in respect of which regular periodic annuity payments have commenced;
(b) in respect of which a contract or certificate has been issued that provides for regular periodic annuity payments to commence within 1 year after the date of issue of the contract or certificate;
(c) that
i. is not issued as or under a registered retirement savings plan, registered pension plan or deferred profit sharing plan,
ii. does not provide for a guaranteed cash surrender value at any time, and
iii. provides for regular periodic annuity payments to commence not later than the attainment of age 71 by the annuitant; or
(d) that
i. is issued as or under a registered retirement savings plan, registered pension plan or deferred profit sharing plan, if
ii. the interest rate is guaranteed for at least 10 years, and
iii. the plan does not provide for any participation in profits, directly or indirectly;
“reported reserve” of an insurer at the end of a taxation year in respect of an insurance policy or a claim, possible claim, risk, dividend, premium, refund of premiums or refund of premium deposits under an insurance policy means
(a) where the insurer is required to file an annual report with the Superintendent of Financial Institutions for a period ending coincidentally with the year, the positive or negative amount of the reserve that would be reported in that report in respect of the insurer’s potential liability under the policy if the reserve were determined without reference to projected income and capital taxes, other than tax payable under Part XII.3 of the Income Tax Act;
(b) where the insurer is, throughout the year, subject to the supervision of the Superintendent of Financial Institutions and paragraph a does not apply, the positive or negative amount of the reserve that would be reported in its financial statements for the year in respect of the insurer’s potential liability under the policy if those financial statements were prepared in accordance with generally accepted accounting principles and the reserve were determined without reference to projected income and capital taxes, other than the tax payable under Part XII.3 of the Income Tax Act;
(c) where the insurer is the Canada Mortgage and Housing Corporation or a foreign affiliate of a taxpayer resident in Canada, the positive or negative amount of the reserve that would be reported in its financial statements for the year in respect of the insurer’s potential liability under the policy if those financial statements were prepared in accordance with generally accepted accounting principles and the reserve were determined without reference to projected income and capital taxes, other than the tax payable under Part XII.3 of the Income Tax Act; and
(d) in any other case, nil;
“segregated fund” has the meaning assigned by subparagraph b of the first paragraph of section 835 of the Act;
“segregated fund policy” has the meaning assigned by subparagraph g of the first paragraph of section 835 of the Act;
“Superintendent of Financial Institutions”, in respect of an insurer, means
(a) the Superintendent of Financial Institutions of Canada, where the insurer is required by law to report to the Superintendent; or
(b) in any other case, where the insurer is incorporated under the laws of Québec, the Autorité des marchés financiers or where the insurer is incorporated under the laws of another province, the Superintendent of Insurance or other similar agent or authority of the other province.
