I-3 - Taxation Act

Section 1129.66.4 Disposition versions

2021-06-04

1129.66.4. If any of the events mentioned in the second paragraph occurs in a taxation year, a trust governed by a registered education savings plan shall pay, for that year, tax equal to the lesser of

(a)  the balance of the plan’s education savings incentive account immediately before the event occurs; and

(b)  the amount determined by the formula

(A × B)/(B + C + D).

The events to which the first paragraph refers are the following:

(a)  the cessation of the plan’s existence;

(b)  the revocation of the plan’s registration;

(c)  the payment of an amount referred to in paragraph b or d of the definition of “trust” in section 890.15;

(d)  the making of an educational assistance payment to an individual who is not a beneficiary under the plan;

(e)  the replacement of a beneficiary under the plan by another beneficiary, except for a recognized replacement described in the second paragraph of section 1029.8.135; and

(f)  the transfer of properties held by the trust governed by the plan to another trust governed by another registered education savings plan, except for an authorized transfer described in the second paragraph of section 1029.8.136.

In the formula in subparagraph b of the first paragraph,

(a)  A is the fair market value of the properties held by the trust governed by the plan immediately before the event occurs;

(b)  B is the balance of the plan’s education savings incentive account immediately before the event occurs;

(c)  C is the aggregate of

i.  the balance of the plan’s grant account immediately before the event occurs, and

ii.  the aggregate of all amounts each of which is the balance of a CLB account of the plan immediately before the event occurs; and

(d)  D is the aggregate of all amounts each of which is the balance of an account of assistance paid under a designated provincial program, within the meaning of section 890.15, of the plan immediately before the event occurs.

2009, c. 5, s. 533; 2021, c. 18, s. 161.

2009-05-15

1129.66.4. If any of the events mentioned in the second paragraph occurs in a taxation year, a trust governed by a registered education savings plan shall pay, for that year, tax equal to the lesser of

(a)  the balance of the plan’s education savings incentive account immediately before the event occurs; and

(b)  the amount by which the fair market value of the properties held by the trust, immediately before the event occurs, exceeds the aggregate of the balances of the plan’s grant account and CLB accounts immediately before the event occurs.

The events to which the first paragraph refers are the following:

(a)  the cessation of the plan’s existence;

(b)  the revocation of the plan’s registration;

(c)  the payment of an amount referred to in paragraph b or d of the definition of “trust” in section 890.15;

(d)  the making of an educational assistance payment to an individual who is not a beneficiary under the plan;

(e)  the replacement of a beneficiary under the plan by another beneficiary, except for a recognized replacement described in the second paragraph of section 1029.8.135; and

(f)  the transfer of properties held by the trust governed by the plan to another trust governed by another registered education savings plan, except for an authorized transfer described in the second paragraph of section 1029.8.136.

2009, c. 5, s. 533.