I-3 - Taxation Act

Section 1 Disposition versions

2023-09-26

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advanced life deferred annuity” has the meaning assigned by section 965.0.38;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  (paragraph repealed);

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property unless

(1)  the property is a Canadian security, within the meaning of section 250.2, or an interest in a partnership the fair market value of which is derived, in whole or in part, from a Canadian security,

(2)  the agreement is an agreement to acquire property from a tax-indifferent investor or a financial institution, within the meaning of section 851.22.1, and

(3)  it can reasonably be considered that one of the main purposes of the series of transactions or events, or of a transaction or event in the series, of which the agreement is part is for all or any portion of the capital gain on a disposition (other than a disposition by the seller to the taxpayer under the agreement) of a Canadian security referred to in subparagraph 1—as part of the same series of transactions or events—to be attributable to amounts paid or payable on the Canadian security by the issuer of the Canadian security during the term of the agreement as interest, dividends or income of a trust other than income paid out of the taxable capital gains of the trust,

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; or

iii.  an underlying interest that relates to a purchase of currency, if it can reasonably be considered that the purchase is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, or

(3)  an underlying interest that relates to a sale of currency, if it can reasonably be considered that the sale is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“first home savings account” at any time means an arrangement accepted as a tax-free first home savings account at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with section 146.6 of that Act;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, a right in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“licensed annuities provider” has the meaning assigned by section 965.0.1;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means

(a)  an automobile acquired after 17 June 1987, other than an automobile that is acquired after that date pursuant to an obligation in writing entered into before 18 June 1987 or that is a zero-emission vehicle; or

(b)  an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852;

“property” means property of any kind whatever whether movable or immovable, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered journalism organization”, at any time, means a journalism organization that is deemed, at that time, to be registered as such with the Minister in accordance with section 985.26.1 and whose registration is in force;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646 and includes, for common law, an estate;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a derivative forward agreement, a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time a right in and an option in respect of the property,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved;

“zero-emission passenger vehicle”, of a taxpayer, means an automobile of the taxpayer that is included in Class 54 in Schedule B to the Regulation respecting the Taxation Act (chapter I-3, r. 1);

“zero-emission vehicle” of a taxpayer, means a motor vehicle that

(a)  is a plug-in hybrid vehicle that meets prescribed conditions or is fully

i.  electric, or

ii.  powered by hydrogen;

(b)  is acquired, and becomes available for use, by the taxpayer after 18 March 2019 and before 1 January 2028;

(c)  is not a vehicle in respect of which

i.  the taxpayer has, at a particular time, made a prescribed election, or

ii.  an amount of assistance has been paid by the Government of Canada under a prescribed program;

(d)  if the vehicle was acquired before 2 March 2020,

i.  has neither been used, nor acquired for use, for any purpose before it was acquired by the taxpayer, and

ii.  is not a vehicle in respect of which an amount has been deducted by another person or partnership under paragraph a of section 130 or the second paragraph of section 130.1; and

(e)  would be an accelerated investment incentive property if the definition of that expression in the first paragraph of section 130R3 of the Regulation respecting the Taxation Act (chapter I-3, r. 1) were read without its exclusion for property included in Class 54 or 55 of Schedule B to that Regulation.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55; 2020, c. 16, s. 23; 2021, c. 14, s. 15; 2021, c. 18, s. 12; 2021, c. 36, s. 50; 2022, c. 23, s. 28; 2023, c. 19, s. 10.

2022-06-08

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advanced life deferred annuity” has the meaning assigned by section 965.0.38;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  paragraph revoked;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property unless

(1)  the property is a Canadian security, within the meaning of section 250.2, or an interest in a partnership the fair market value of which is derived, in whole or in part, from a Canadian security,

(2)  the agreement is an agreement to acquire property from a tax-indifferent investor or a financial institution, within the meaning of section 851.22.1, and

(3)  it can reasonably be considered that one of the main purposes of the series of transactions or events, or of a transaction or event in the series, of which the agreement is part is for all or any portion of the capital gain on a disposition (other than a disposition by the seller to the taxpayer under the agreement) of a Canadian security referred to in subparagraph 1—as part of the same series of transactions or events—to be attributable to amounts paid or payable on the Canadian security by the issuer of the Canadian security during the term of the agreement as interest, dividends or income of a trust other than income paid out of the taxable capital gains of the trust,

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; or

iii.  an underlying interest that relates to a purchase of currency, if it can reasonably be considered that the purchase is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, or

(3)  an underlying interest that relates to a sale of currency, if it can reasonably be considered that the sale is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, a right in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“licensed annuities provider” has the meaning assigned by section 965.0.1;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means

(a)  an automobile acquired after 17 June 1987, other than an automobile that is acquired after that date pursuant to an obligation in writing entered into before 18 June 1987 or that is a zero-emission vehicle; or

(b)  an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852;

“property” means property of any kind whatever whether movable or immovable, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered journalism organization”, at any time, means a journalism organization that is deemed, at that time, to be registered as such with the Minister in accordance with section 985.26.1 and whose registration is in force;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646 and includes, for common law, an estate;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into,

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a derivative forward agreement, a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time a right in and an option in respect of the property,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved;

“zero-emission passenger vehicle”, of a taxpayer, means an automobile of the taxpayer that is included in Class 54 in Schedule B to the Regulation respecting the Taxation Act (chapter I-3, r. 1);

“zero-emission vehicle” of a taxpayer, means a motor vehicle that

(a)  is a plug-in hybrid vehicle that meets prescribed conditions or is fully

i.  electric, or

ii.  powered by hydrogen;

(b)  is acquired, and becomes available for use, by the taxpayer after 18 March 2019 and before 1 January 2028;

(c)  is not a vehicle in respect of which

i.  the taxpayer has, at a particular time, made a prescribed election, or

ii.  an amount of assistance has been paid by the Government of Canada under a prescribed program;

(d)  if the vehicle was acquired before 2 March 2020,

i.  has neither been used, nor acquired for use, for any purpose before it was acquired by the taxpayer, and

ii.  is not a vehicle in respect of which an amount has been deducted by another person or partnership under paragraph a of section 130 or the second paragraph of section 130.1; and

(e)  would be an accelerated investment incentive property if the definition of that expression in the first paragraph of section 130R3 of the Regulation respecting the Taxation Act (chapter I-3, r. 1) were read without its exclusion for property included in Class 54 or 55 of Schedule B to that Regulation.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55; 2020, c. 16, s. 23; 2021, c. 14, s. 15; 2021, c. 18, s. 12; 2021, c. 36, s. 50; 2022, c. 23, s. 28.

2021-12-10

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  paragraph revoked;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property unless

(1)  the property is a Canadian security, within the meaning of section 250.2, or an interest in a partnership the fair market value of which is derived, in whole or in part, from a Canadian security,

(2)  the agreement is an agreement to acquire property from a tax-indifferent investor or a financial institution, within the meaning of section 851.22.1, and

(3)  it can reasonably be considered that one of the main purposes of the series of transactions or events, or of a transaction or event in the series, of which the agreement is part is for all or any portion of the capital gain on a disposition (other than a disposition by the seller to the taxpayer under the agreement) of a Canadian security referred to in subparagraph 1—as part of the same series of transactions or events—to be attributable to amounts paid or payable on the Canadian security by the issuer of the Canadian security during the term of the agreement as interest, dividends or income of a trust other than income paid out of the taxable capital gains of the trust,

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; or

iii.  an underlying interest that relates to a purchase of currency, if it can reasonably be considered that the purchase is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, or

(3)  an underlying interest that relates to a sale of currency, if it can reasonably be considered that the sale is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, a right in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means

(a)  an automobile acquired after 17 June 1987, other than an automobile that is acquired after that date pursuant to an obligation in writing entered into before 18 June 1987 or that is a zero-emission vehicle; or

(b)  an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852;

“property” means property of any kind whatever whether movable or immovable, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered journalism organization”, at any time, means a journalism organization that is deemed, at that time, to be registered as such with the Minister in accordance with section 985.26.1 and whose registration is in force;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646 and includes, for common law, an estate;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into,

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a derivative forward agreement, a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time a right in and an option in respect of the property,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved;

“zero-emission passenger vehicle”, of a taxpayer, means an automobile of the taxpayer that is included in Class 54 in Schedule B to the Regulation respecting the Taxation Act (chapter I-3, r. 1);

“zero-emission vehicle” of a taxpayer, means a motor vehicle that

(a)  is a plug-in hybrid vehicle that meets prescribed conditions or is fully

i.  electric, or

ii.  powered by hydrogen;

(b)  is acquired, and becomes available for use, by the taxpayer after 18 March 2019 and before 1 January 2028;

(c)  is not a vehicle in respect of which

i.  the taxpayer has, at a particular time, made a prescribed election, or

ii.  an amount of assistance has been paid by the Government of Canada under a prescribed program;

(d)  if the vehicle was acquired before 2 March 2020,

i.  has neither been used, nor acquired for use, for any purpose before it was acquired by the taxpayer, and

ii.  is not a vehicle in respect of which an amount has been deducted by another person or partnership under paragraph a of section 130 or the second paragraph of section 130.1; and

(e)  would be an accelerated investment incentive property if the definition of that expression in the first paragraph of section 130R3 of the Regulation respecting the Taxation Act (chapter I-3, r. 1) were read without its exclusion for property included in Class 54 or 55 of Schedule B to that Regulation.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55; 2020, c. 16, s. 23; 2021, c. 14, s. 15; 2021, c. 18, s. 12; 2021, c. 36, s. 50.

2021-06-04

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  paragraph revoked;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; or

iii.  an underlying interest that relates to a purchase of currency, if it can reasonably be considered that the purchase is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, or

(3)  an underlying interest that relates to a sale of currency, if it can reasonably be considered that the sale is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, a right in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means

(a)  an automobile acquired after 17 June 1987, other than an automobile that is acquired after that date pursuant to an obligation in writing entered into before 18 June 1987 or that is a zero-emission vehicle; or

(b)  an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852;

“property” means property of any kind whatever whether movable or immovable, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered journalism organization”, at any time, means a journalism organization that is deemed, at that time, to be registered as such with the Minister in accordance with section 985.26.1 and whose registration is in force;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646 and includes, for common law, an estate;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into,

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time a right in and an option in respect of the property,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved;

“zero-emission passenger vehicle”, of a taxpayer, means an automobile of the taxpayer that is included in Class 54 in Schedule B to the Regulation respecting the Taxation Act (chapter I-3, r. 1);

“zero-emission vehicle” of a taxpayer, means a motor vehicle that

(a)  is a plug-in hybrid vehicle that meets prescribed conditions or is fully

i.  electric, or

ii.  powered by hydrogen;

(b)  is acquired, and becomes available for use, by the taxpayer after 18 March 2019 and before 1 January 2028;

(c)  has not been used, or acquired for use, for any purpose before it was acquired by the taxpayer; and

(d)  is not a vehicle in respect of which

i.  the taxpayer has, at a particular time, made a prescribed election,

ii.  an amount of assistance has been paid by the Government of Canada under a prescribed program, or

iii.  an amount has been deducted by another person or partnership under paragraph a of section 130 or the second paragraph of section 130.1.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55; 2020, c. 16, s. 23; 2021, c. 14, s. 15; 2021, c. 18, s. 12.

2021-06-02

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  paragraph revoked;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; or

iii.  an underlying interest that relates to a purchase of currency, if it can reasonably be considered that the purchase is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property,

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, or

(3)  an underlying interest that relates to a sale of currency, if it can reasonably be considered that the sale is agreed to by the taxpayer in order to reduce the risk to the taxpayer of fluctuations in the value of the currency from which a capital property of the taxpayer derives its value or in which a purchase or sale by the taxpayer of a capital property, or an obligation that is a capital property of the taxpayer, is denominated, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, a right in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852;

“property” means property of any kind whatever whether movable or immovable, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646 and includes, for common law, an estate;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into,

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time a right in and an option in respect of the property,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55; 2020, c. 16, s. 23; 2021, c. 14, s. 15.

2020-09-24

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  paragraph revoked;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, a right in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether movable or immovable, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646 and includes, for common law, an estate;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into,

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time a right in and an option in respect of the property,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55; 2020, c. 16, s. 23.

2019-06-19

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  paragraph revoked;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership (in this definition referred to as the “person”) means

(a)  any arrangement entered into by the person where it can reasonably be considered that

i.  the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and

ii.  under the arrangement another person or partnership bears the risk of loss or enjoys the opportunity for gain or profit with respect to the share in any material respect;

(b)  any arrangement under which

i.  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

ii.  the corporation or a partnership of which the corporation is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

(1)  the dividend described in subparagraph i,

(2)  a dividend on a share that is identical to the particular share, or

(3)  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate risk of loss or opportunity for gain or profit as the particular share;

(c)  any synthetic equity arrangement in respect of a dividend rental arrangement share of the person; or

(d)  one or more arrangements (other than arrangements described in paragraph c) entered into by the person, the connected person referred to in paragraph a of the definition of “synthetic equity arrangement” or by any combination of the person and connected persons, if

i.  the arrangements have the effect, or would have the effect if each arrangement entered into by a connected person were entered into by the person, of eliminating all or substantially all of the risk of loss and opportunity for gain or profit in respect of a dividend rental arrangement share of the person,

ii.  as part of a series of transactions that includes these arrangements, a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, obtains all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share or an identical share, within the meaning of section 745.3, and

iii.  it is reasonable to conclude that one of the purposes of the series of transactions is to obtain the result described in subparagraph ii;

“dividend rental arrangement share” of a person or partnership means a share

(a)  that is owned by the person or partnership;

(b)  in respect of which the person or partnership is deemed to have received a dividend under section 21.32 and is provided with all or substantially all of the risk of loss and opportunity for gain or profit under an arrangement;

(c)  that is held by a trust under which the person or partnership is a beneficiary and in respect of which the person or partnership is deemed to have received a dividend as a result of a designation by the trust under section 666;

(d)  in respect of which the person or partnership is deemed to have received a dividend under section 498; or

(e)  in any other case, in respect of which the person or partnership is (or would be in the absence of section 740.4.1) entitled to a deduction under section 738 in relation to dividends received on the share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible relocation” has the meaning assigned by section 349.1;

“emission allowance” means an allowance, credit or similar instrument that represents a unit of emission that can be used to satisfy a requirement under the laws of Québec, Canada or another province governing emissions of regulated substances, such as greenhouse gas emissions;

“emission obligation” means an obligation to surrender an emission allowance, or an obligation that can otherwise be satisfied through the use of an emission allowance, under a law of Québec, Canada or another province governing emissions of regulated substances;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and includes

(a)  with respect to a farming business, all of the livestock held in the course of carrying on the business; and

(b)  an emission allowance;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever, the work in progress of a business that is a profession and the goodwill of a business referred to in section 93.14;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized derivatives exchange” means a person or partnership recognized or registered under the securities laws of a province to carry on the business of providing the facilities necessary for the trading of options, swaps, futures contracts or other financial contracts or instruments whose market price, value, delivery obligations, payment obligations or settlement obligations are derived from, referenced to or based on an underlying interest;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified mutual fund trust”, at any time, means a mutual fund trust other than a mutual fund trust in respect of which it can reasonably be considered, having regard to all the circumstances, including the terms and conditions of the units of the trust, that the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust and held by a person exempt from tax under sections 980 to 999.1 is all or substantially all of the aggregate of all amounts each of which is the fair market value, at that time, of a unit issued by the trust;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership means one or more arrangements that

(a)  have the effect of providing to a person or partnership all or any portion of the risk of loss or opportunity for gain or profit in respect of the dividend rental arrangement share and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share; and

(b)  can reasonably be considered to have been entered into in connection with a synthetic equity arrangement, in respect of the dividend rental arrangement share, or in connection with another specified synthetic equity arrangement, in respect of the dividend rental arrangement share;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“synthetic equity arrangement” in respect of a dividend rental arrangement share of a person or partnership (in this definition referred to as the “particular person”) means one or more arrangements that

(a)  meet the following conditions:

i.  they are entered into by the particular person, by a person or partnership that does not deal at arm’s length with, or is affiliated with, the particular person (in this definition referred to as a “connected person”) or by any combination of the particular person and connected persons, with one or more persons or partnerships (in this definition referred to as a “counterparty” and in section 740.4.3 referred to as a “counterparty” or an “affiliated counterparty”, as the case may be),

ii.  they have the effect, or would have the effect, if each arrangement entered into by a connected person were entered into by the particular person, of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a counterparty or a group of counterparties each member of which is affiliated with every other member and, to that end, opportunity for gain or profit includes rights to, benefits from and distributions on a share, and

iii.  if entered into by a connected person, they can reasonably be considered to have been entered into with the knowledge, or where there ought to have been the knowledge, that the effect described in subparagraph ii would result; and

(b)  are not

i.  an agreement that is traded on a recognized derivatives exchange unless it can reasonably be considered that, at the time the agreement is entered into,

(1)  the particular person or the connected person, as the case may be, knows or ought to have known that the agreement is part of a series of transactions that has the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the dividend rental arrangement share to a tax-indifferent investor, or a group of tax-indifferent investors each member of which is affiliated with every other member, or

(2)  one of the main reasons for entering into the agreement is to obtain the benefit of a deduction in respect of a payment, or a reduction of an amount that would otherwise have been included in computing income, under the agreement, that corresponds to an expected or actual dividend in respect of a dividend rental arrangement share,

ii.  one or more arrangements that, but for this subparagraph, would be a synthetic equity arrangement, in respect of a share owned by the particular person (in this subparagraph referred to as the “synthetic short position”), if

(1)  the particular person has entered into one or more arrangements (in this subparagraph referred to as the “synthetic long position”) that have the effect of providing all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share to the particular person, other than an arrangement under which the share is acquired or an arrangement under which the particular person receives a deemed dividend and is provided with all or substantially all of the risk of loss and opportunity for gain or profit in respect of the share,

(2)  the synthetic short position has the effect of offsetting all amounts included or deducted in computing the income of the particular person with respect to the synthetic long position, and

(3)  the synthetic short position was entered into for the purpose of obtaining the effect referred to in subparagraph 2, or

iii.  an agreement to purchase the shares of a corporation, or a purchase agreement that is part of a series of agreements to purchase the shares of a corporation, under which a counterparty or a group of counterparties each member of which is affiliated with every other member acquires control of the corporation that has issued the shares being purchased, unless the main reason for incorporating, establishing or operating the corporation is to have this subparagraph apply;

“synthetic equity arrangement chain” in respect of a share owned by a person or partnership means a synthetic equity arrangement—or a synthetic equity arrangement in combination with one or more specified synthetic equity arrangements—where

(a)  no party to the synthetic equity arrangement or a specified synthetic equity arrangement, if any, is a tax-indifferent investor; and

(b)  each other party to these arrangements is affiliated with the person or partnership;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax-indifferent investor”, at any time, means a person or partnership that is at that time

(a)  a person exempt from tax under sections 980 to 999.1;

(b)  a person not resident in Canada, other than a person to which all amounts paid or credited under a synthetic equity arrangement or a specified synthetic equity arrangement may reasonably be attributed to the business carried on by the person in Canada through an establishment;

(c)  a trust resident in Canada (other than a specified mutual fund trust) if any of the interests as a beneficiary under the trust is not a fixed interest, within the meaning of section 21.0.5, in the trust (in this definition referred to as a “discretionary trust”);

(d)  a partnership if more than 10% of the fair market value of all interests in which can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in any of paragraphs a to c; or

(e)  a trust resident in Canada (other than a specified mutual fund trust or a discretionary trust) if more than 10% of the fair market value of all interests as beneficiaries under the trust can reasonably be considered to be held, directly or indirectly through one or more trusts or partnerships, by any combination of persons described in paragraph a or c;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15; 2019, c. 14, s. 55.

2017-12-07

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust,

i.  in the case where the taxation year of the trust ended immediately before the time at which the trust was subject to a loss restriction event, the day that is

(1)  if the particular time at which the taxation year ends occurs in a calendar year and after the end of another taxation year that ended on 15 December of that calendar year because of an election provided for in section 1121.7, 90 days after the end of the other taxation year,

(2)  if subparagraph 1 does not apply and the trust’s particular taxation year that begins immediately after the particular time ends in the calendar year that includes the particular time, the balance-due day of the trust for the particular taxation year, and

(3)  if subparagraphs 1 and 2 do not apply, 90 days after the end of the calendar year that includes the particular time, and

ii.  in any other case, the day that is 90 days after the end of the taxation year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership means any arrangement entered into by the person or partnership where it may reasonably be considered that the main reason for the person or partnership entering into the arrangement is to enable the person or partnership to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement another person or partnership enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time; and

(b)  the corporation or a partnership of which it is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Title VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63; 2017, c. 29, s. 15.

2017-02-08

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), paragraph b.1 of the definition of “amount” in subsection 1 of section 248 of that Act, as it reads in its application after 16 July 2005 and in relation to a taxation year of a taxpayer that begins before 1 January 2013, or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership means any arrangement entered into by the person or partnership where it may reasonably be considered that the main reason for the person or partnership entering into the arrangement is to enable the person or partnership to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement another person or partnership enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time; and

(b)  the corporation or a partnership of which it is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“graduated rate estate” has the meaning assigned by section 646.0.1;

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international shipping” means the operation of a ship owned or leased by a person or partnership (in this definition referred to as the “operator”) that is used, either directly or as part of a pooling arrangement, primarily in transporting passengers or goods in international traffic—determined as if, in the case of a voyage between Canada and a place outside Canada, any port or other place on the Great Lakes or St. Lawrence River is in Canada—including the chartering of the ship, provided that one or more persons related to the operator (if the operator and each such person is a corporation), or persons or partnerships affiliated with the operator (in any other case), has complete possession, control and command of the ship, and any activity incident to or pertaining to the operation of the ship, but does not include

(a)  the offshore storing or processing of goods;

(b)  fishing;

(c)  laying cable;

(d)  salvaging;

(e)  towing;

(f)  tug-boating;

(g)  offshore oil and gas activities (other than the transportation of oil and gas), including exploration and drilling activities;

(h)  dredging; or

(i)  leasing a ship to a lessee that has complete possession, control and command of the ship, unless the lessor or a corporation, trust or partnership affiliated with the lessor has an eligible interest, within the meaning of section 11.1.1.4, in the lessee;

“international traffic” means, in respect of a person or partnership carrying on a transportation business, a voyage made in the course of that business if the principal purpose of the voyage is to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“leveraged insurance policy” means a life insurance policy (other than an annuity contract) where

(a)  an amount is or may become

i.  payable, under the terms of a borrowing, to a person or partnership that has been assigned an interest in the policy or in an investment account in respect of the policy, or

ii.  payable, within the meaning of subparagraph j of the first paragraph of section 835, under a policy loan, within the meaning of paragraph a.1.1 of section 966, made in accordance with the terms and conditions of the policy; and

(b)  either

i.  the return credited to an investment account in respect of the policy is determined by reference to the rate of interest on the borrowing or policy loan, as the case may be, described in paragraph a and would not be credited to the account if the borrowing or policy loan, as the case may be, were not in existence, or

ii.  the maximum amount of an investment account in respect of the policy is determined by reference to the amount of the borrowing or policy loan, as the case may be, described in paragraph a;

“leveraged insured annuity policy” means a life insurance policy (other than an annuity contract) where

(a)  a particular person or partnership is obligated after 20 March 2013 to repay an amount to another person or partnership (in this definition referred to as the “lender”) at a time determined by reference to the death of a particular individual whose life is insured under the policy; and

(b)  the lender is assigned an interest in

i.  the policy, and

ii.  an annuity contract the terms of which provide that annuity payments are to continue for a period that ends no earlier than the death of the particular individual;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner”, of a particular partnership at any time, means a person or partnership (in paragraphs a and b referred to as the “taxpayer”)

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“synthetic disposition arrangement”, in respect of a property owned by a taxpayer, means one or more agreements or other arrangements that

(a)  are entered into by the taxpayer or by a person or partnership that does not deal at arm’s length with the taxpayer;

(b)  have the effect, or would have the effect if entered into by the taxpayer instead of the person or partnership described in paragraph a, of eliminating all or substantially all the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a definite or indefinite period of time; and

(c)  can, in respect of any agreement or arrangement entered into by a person or partnership that does not deal at arm’s length with the taxpayer, reasonably be considered to have been entered into, in whole or in part, with the purpose of obtaining the effect described in paragraph b;

“synthetic disposition period”, of a synthetic disposition arrangement, means a definite or indefinite period of time during which the synthetic disposition arrangement has, or would have, the effect described in paragraph b of the definition of “synthetic disposition arrangement”;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of a succession that is a graduated rate estate, the particular period for which the succession’s accounts are made up for purposes of assessment under this Part, which particular period must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act; and

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

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9; 2017, c. 1, s. 63.

2015-10-26

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest population centre, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“derivative forward agreement”, of a taxpayer, means an agreement entered into by the taxpayer to purchase or sell a capital property if

(a)  the term of the agreement exceeds 180 days or the agreement is part of a series of agreements with a term that exceeds 180 days;

(b)  in the case of a purchase agreement, the difference between the fair market value of the property delivered on settlement, including partial settlement, of the agreement and the amount paid for the property is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

i.  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

ii.  if the purchase price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency; and

(c)  in the case of a sale agreement,

i.  the difference between the sale price of the property and the fair market value of the property at the time the agreement is entered into by the taxpayer is attributable, in whole or in part, to an underlying interest (including a value, price, rate, variable, index, event, probability or thing) other than

(1)  revenue, income or cash flow in respect of the property over the term of the agreement, changes in the fair market value of the property over the term of the agreement, or any similar criteria in respect of the property, or

(2)  if the sale price is denominated in the currency of a country other than Canada, changes in the value of the Canadian currency relative to that other currency, and

ii.  the agreement is part of an arrangement that has the effect–or would have the effect if the agreements that are part of the arrangement and that were entered into by persons or partnerships not dealing at arm’s length with the taxpayer were entered into by the taxpayer instead of those non-arm’s length persons or partnerships–of eliminating a majority of the taxpayer’s risk of loss and opportunity for profit or gain in respect of the property for a period of more than 180 days;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person or a partnership means any arrangement entered into by the person or partnership where it may reasonably be considered that the main reason for the person or partnership entering into the arrangement is to enable the person or partnership to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or on a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement another person or partnership enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time; and

(b)  the corporation or a partnership of which it is a member is obligated to pay to another person or partnership an amount as compensation for each of the following dividends that, if paid, would be deemed under section 21.32 to have been received by that other person or partnership, as the case may be, as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92; 2015, c. 24, s. 9.

2015-10-21

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority-interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan, including, except for the purposes of section 317, any amount received under a pooled registered pension plan, and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“pooled registered pension plan” or “PRPP” means a plan that has been accepted for the purposes of the Income Tax Act by the Minister of National Revenue as a PRPP and whose registration is in force;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in subparagraph d of the third paragraph of section 38, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority-interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority-interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.3.3;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.3.3;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12; 2015, c. 21, s. 92.

2013-06-05

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act (other than a federal credit union) or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a portion of a taxable dividend that is paid by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if the taxable dividend is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by the first paragraph of section 1129.51;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“federal credit union” has the meaning assigned by section 2 of the Bank Act;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign accrual property income” has the meaning assigned by section 579;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer”;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified pension plan” means a prescribed arrangement;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership,

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34; 2013, c. 10, s. 12.

2012-05-09

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by section 999.2;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” at any time means a Canadian amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time or that is deemed to be registered in accordance with the second paragraph of section 985.23.6;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” at any time means a Québec amateur athletic association within the meaning of section 985.23.1 that is registered as such with the Minister at that time;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (2009, chapter 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90; 2012, c. 8, s. 34.

2012-01-01

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction, or a regulation under such a law, that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (S.Q. 2009, c. 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110; 2009, c. 24, s. 90.

2011-06-06

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee life and health trust” has the meaning assigned by section 869.2;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means

(a)  an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22); or

(b)  an account of a taxpayer under the Agri-Québec program under the Act respecting La Financière agricole du Québec;

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means

(a)  the portion of a taxpayer’s net income stabilization account, under the Farm Income Protection Act, that is described in paragraph b of subsection 2 of section 8 of that Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate; or

(b)  the portion of a taxpayer’s net income stabilization account, under the Act respecting La Financière agricole du Québec, that is referred to as “Fund 2” under the Agri-Québec program;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (S.Q. 2009, c. 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175; 2011, c. 6, s. 110.

2011-04-01

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Tax Administration Act (chapter A-6.002);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account that is described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (S.Q. 2009, c. 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4; 2010, c. 31, s. 175.

2010-10-27

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by subparagraph h of the first paragraph of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Act respecting the Ministère du Revenu (chapter M-31);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“investment in a SIFT wind-up entity” means

(a)  if the SIFT wind-up entity is a trust and subject to paragraph c, a capital interest (determined without reference to section 7.11.1) in the trust;

(b)  if the SIFT wind-up entity is a partnership and subject to paragraph c, an interest as a member of the partnership where, by operation of any law governing the arrangement in respect of the partnership, the liability of the member as a member of the partnership is limited; and

(c)  if all of the interests described in paragraphs a and b are described by reference to units, the part of the interest represented by such a unit;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by subparagraph e of the first paragraph of section 835;

“life insurance policy in Canada” has the meaning assigned by subparagraph e.1 of the first paragraph of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account that is described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust wind-up event” means a distribution by a particular trust resident in Canada of property to a taxpayer in respect of which the following conditions are met:

(a)  the distribution occurs before 1 January 2013;

(b)  there is a resulting disposition of all of the taxpayer’s interest as a beneficiary under the particular trust;

(c)  the particular trust is

i.  a SIFT wind-up entity,

ii.  a trust whose only beneficiary throughout the period (in this definition referred to as the “qualifying period”) that begins on 14 July 2008 and that ends at the time of the distribution is another trust that throughout the qualifying period

(1)  is resident in Canada, and

(2)  is a SIFT wind-up entity or a trust described in this subparagraph ii, or

iii.  a trust whose only beneficiary at the time of distribution is another trust that throughout the qualifying period

(1)  is resident in Canada,

(2)  is a SIFT wind-up entity or a trust described in subparagraph ii, and

(3)  is a majority interest beneficiary (within the meaning that would be assigned by section 21.0.1 if paragraphs a and b of the definition of “majority interest beneficiary” were read as if “50%” was replaced by “25%”) of the particular trust;

(d)  the particular trust ceases to exist immediately after the distribution or immediately after the last of a series of SIFT trust wind-up events (determined without reference to this paragraph) of the particular trust that includes the distribution; and

(e)  the property was not acquired by the particular trust as a result of

i.  a transfer or an exchange that is a qualifying exchange (within the meaning of the first paragraph of section 785.4) or a qualifying disposition (within the meaning of section 692.5) that is made after 2 February 2009 and that is from any person other than a SIFT wind-up entity, or

ii.  the transfer or the exchange, to which Division XIII of Chapter IV of Title IV of Book III, any of Chapters IV to IX of Title IX of Book III, Chapter X of Title XII of that Book or Title I.2 of Book VI applies, of another property acquired as a result of a transfer or an exchange described in subparagraph i or this subparagraph;

“SIFT wind-up corporation”, in respect of a SIFT wind-up entity (in this definition referred to as a “particular entity”), means at a particular time a corporation

(a)  that, at any time that is after 13 July 2008 and before the earlier of the particular time and 1 January 2013, owns all of the investments in the particular entity, each of which is an investment in a SIFT wind-up entity, or

(b)  the shares of the capital stock of which are at or before the particular time distributed as part of a SIFT trust wind-up event of the particular entity;

“SIFT wind-up entity” means a trust or partnership that at any time in the period that began on 31 October 2006 and that ended on 14 July 2008 is

(a)  a SIFT trust or a trust that would be a SIFT trust but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements (S.Q. 2009, c. 5);

(b)  a SIFT partnership or a partnership that would be a SIFT partnership but for subsection 3 of section 534 of the Act giving effect to the Budget Speech delivered on 24 May 2007, to the 1 June 2007 Ministerial Statement Concerning the Government’s 2007-2008 Budgetary Policy and to certain other budget statements; or

(c)  a real estate investment trust, within the meaning of the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9; 2010, c. 25, s. 4.

2010-04-20

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by subparagraph a of the second paragraph of section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“designated stock exchange” means a stock exchange, or that part of a stock exchange, for which a designation made or deemed to be made by the Minister of Finance of Canada under section 262 of the Income Tax Act is in effect;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Act respecting the Ministère du Revenu (chapter M-31);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign currency debt” has the meaning assigned by section 736.0.0.2;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer”;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by paragraph e of section 835;

“life insurance policy in Canada” has the meaning assigned by paragraph e.1 of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account that is described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“recognized stock exchange” means

(a)  a designated stock exchange; or

(b)  a stock exchange, other than a designated stock exchange, located in Canada or in a country that is a member of the Organisation for Economic Co-operation and Development that entered into a tax agreement (within the meaning that would be assigned to that expression by this section if the Gouvernement du Québec had not entered into an agreement referred to in the definition of that expression) with the Government of Canada;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 5 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25; 2010, c. 5, s. 9.

2009-06-04

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“Canadian stock exchange” means a prescribed Canadian stock exchange;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Act respecting the Ministère du Revenu (chapter M-31);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“foreign stock exchange” means a prescribed foreign stock exchange;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property of the taxpayer, an interest in such property or a property that is the subject of a valid election referred to in subparagraph c of the first paragraph of section 96.0.2, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by paragraph e of section 835;

“life insurance policy in Canada” has the meaning assigned by paragraph e.1 of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account that is described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act and that can reasonably be considered to be attributable to a program that allows the funds in the account to accumulate;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“qualifying trust annuity” has the meaning assigned by section 21.43;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered disability savings plan” has the meaning assigned by Title III.1 of Book VII;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-free savings account” or “TFSA” at any time means an arrangement accepted as such at that time by the Minister of National Revenue for the purposes of the Income Tax Act, in accordance with subsection 3 of section 146.2 of that Act;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6; 2009, c. 15, s. 25.

2009-05-15

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (S.C. 1991, c. 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 km outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (R.S.C. 1985, c. B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“Canadian stock exchange” means a prescribed Canadian stock exchange;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible dividend” means an amount, in respect of a person resident in Canada, that is deemed to be a taxable dividend received by the person under section 603.1 or 663.4, or a taxable dividend that is paid after 23 March 2006 by a corporation resident in Canada, that is received by a person resident in Canada and that

(a)  is designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act; or

(b)  if it is included in a particular amount that is deemed to be a dividend or taxable dividend, corresponds, without exceeding the particular amount, to the portion, designated, in accordance with subsection 14 of section 89 of the Income Tax Act, as an eligible dividend for the purposes of that Act, of the amount, corresponding to the particular amount, that is deemed to be a dividend or taxable dividend for the purposes of that Act;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Act respecting the Ministère du Revenu (chapter M-31);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“foreign stock exchange” means a prescribed foreign stock exchange;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property or an interest therein of the taxpayer, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (R.S.C. 1985, c. E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 km greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (S.C. 1996, c. 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by paragraph e of section 835;

“life insurance policy in Canada” has the meaning assigned by paragraph e.1 of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (S.C. 1991, c. 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (R.S.C. 1985, c. C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (R.S.C. 1985, c. C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (R.S.C. 1985, c. C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding 30 years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within 10 days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“SIFT partnership” has the meaning assigned by the first paragraph of section 1129.70;

“SIFT trust” has the meaning assigned by the first paragraph of section 1129.70;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means

(a)  in the case of a corporation, a fiscal period;

(b)  in the case of an individual, other than a testamentary trust, a calendar year; and

(c)  in the case of a testamentary trust, the particular period for which the trust’s accounts are made up for purposes of assessment under this Part, which particular period,

i.  if it begins at a time after 20 December 2006, must end at the end of the period that includes that time and for which the accounts are made up for purposes of assessment under the Income Tax Act, or

ii.  if it includes 20 December 2006, must end at the time at which ends the period that includes that day and for which the accounts are made up for purposes of assessment under the Income Tax Act, unless the period for which the trust’s accounts are made up for purposes of assessment under the Income Tax Act that includes 20 December 2006 ends more than 12 months after the time at which the particular period begins;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20; 2009, c. 5, s. 6.

2007-11-07

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (Statutes of Canada, 1991, chapter 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 kilometres outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (Revised Statutes of Canada, 1985, chapter B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“Canadian stock exchange” means a prescribed Canadian stock exchange;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fiscal law” means a fiscal law within the meaning of the Act respecting the Ministère du Revenu (chapter M-31);

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“foreign stock exchange” means a prescribed foreign stock exchange;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property or an interest therein of the taxpayer, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 kilometres greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (Statutes of Canada, 1996, chapter 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by paragraph e of section 835;

“life insurance policy in Canada” has the meaning assigned by paragraph e.1 of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (Statutes of Canada, 1991, chapter 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (Revised Statutes of Canada, 1985, chapter C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (Revised Statutes of Canada, 1985, chapter C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (Revised Statutes of Canada, 1985, chapter C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding thirty years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within ten days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32 and in paragraph a of the definition of “earned income” set out in section 1029.8.67, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means, in the case of a corporation, a fiscal period and, in the case of an individual, a calendar year;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.4.1;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20; 2007, c. 12, s. 20.

2006-12-06

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

“Act establishing a labour-sponsored fund” means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

“additional voluntary contribution” to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

“adjusted cost base” has the meaning assigned by Chapter III of Title IV of Book III;

“adjustment time” has the meaning assigned by section 107.1;

“advocate” means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

“allowable business investment loss” has the meaning given to it by section 231;

“allowable capital loss” has the meaning assigned by section 231;

“alter ego trust” has the meaning assigned by section 652.1;

“amateur athlete trust” has the meaning assigned by section 851.34;

“amortized cost” of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

“amount” means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

“annuity” includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

“assessment” includes a reassessment and an additional assessment;

“aunt” of a taxpayer includes the spouse of the taxpayer’s uncle;

“authorized foreign bank” has the meaning assigned by section 2 of the Bank Act (Statutes of Canada, 1991, chapter 46);

“automobile” means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 kilometres outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

“balance-due day” of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

“bank” means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

“bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act (Revised Statutes of Canada, 1985, chapter B-3);

“bankruptcy” has the meaning assigned by the Bankruptcy and Insolvency Act;

“benefit under a deferred profit sharing plan” received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

“bituminous sands” means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

“borrowed money” includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

“brother” of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

“business” includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

“Canada” includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

“Canadian banking business” means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

“Canadian-controlled private corporation” has the meaning assigned by section 21.19;

“Canadian corporation” has the meaning assigned by paragraph l of section 570;

“Canadian development expenses” has the meaning assigned by sections 408 to 410;

“Canadian exploration and development expenses” has the meaning assigned by sections 364 to 366;

“Canadian exploration expenses” has the meaning assigned by sections 395 to 397;

“Canadian oil and gas property expense” has the meaning assigned by sections 418.2 to 418.4;

“Canadian partnership” has the meaning assigned by section 599;

“Canadian resource property” has the meaning assigned by section 370;

“Canadian stock exchange” means a prescribed Canadian stock exchange;

“capital dividend” has the meaning assigned by sections 502 to 502.0.4;

“capital interest” in a trust by a taxpayer has the meaning assigned by section 683;

“capital property” has the meaning assigned by section 249;

“cash method” has the meaning assigned by section 194;

“cemetery care trust” has the meaning assigned by section 979.19;

“certified archival centre” means an archival centre certified by Bibliothèque et Archives nationales du Québec and the certification of which is in force;

“charity” means a charitable organization or charitable foundation, within the meaning of section 985.1;

“child” of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

“common share” means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

“compensation for the loss of financial support” means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

“corporation incorporated in Canada” includes any corporation incorporated in any region of Canada before or after it became part of Canada;

“cost amount” to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

“(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;”;

“i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;”;

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

“death benefit” has the meaning assigned by section 3;

“deferred amount” at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

“deferred profit sharing plan” has the meaning assigned by section 870;

“depreciable property” has the meaning assigned by subparagraph c of the first paragraph of section 93;

“designated insurance property” has the meaning assigned by section 818;

“development bond” has the meaning assigned by section 119.2;

“disposition” has the meaning assigned by section 248;

“dividend” includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

“dividend rental arrangement” of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

“eligible funeral arrangement” has the meaning assigned by section 979.19;

“eligible incorporeal capital amount” has the meaning assigned by section 107;

“eligible relocation” has the meaning assigned by the first paragraph of section 349.1;

“employee” means any person employed or holding an office;

“employee benefit plan” has the meaning assigned by section 47.6;

“employee trust” has the meaning assigned by sections 47.7 to 47.9;

“employer”, in relation to an employee, means the person from whom the employee receives remuneration;

“employment” means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

“environmental trust” has the meaning assigned by section 21.40;

“establishment” has the meaning assigned to it by sections 12 to 16.2;

“exempt income” means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

“farm income stabilization account” means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

“farming” includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

“farm loss” has the meaning assigned by section 728.2;

“filing-due date” of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

“fishing” includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

“flow-through share” has the meaning assigned by section 359.1;

“foreign affiliate” has the meaning assigned by section 571;

“foreign currency” means currency of a foreign country;

“foreign exploration and development expenses” has the meaning assigned by sections 372 and 372.1;

“foreign resource expense” has the meaning assigned by sections 418.1.1 and 418.1.2;

“foreign resource pool expenses” of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

“foreign resource property” has the meaning assigned by section 373;

“foreign retirement arrangement” means a prescribed plan or arrangement;

“foreign stock exchange” means a prescribed foreign stock exchange;

“former business property” of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property or an interest therein of the taxpayer, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression “former business property” is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

“goods and services tax” means the tax payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

“grandfather” of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

“grandfathered share” has the meaning assigned by sections 21.11.20 and 21.11.21;

“grandmother” of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

“great-aunt” of a taxpayer includes the spouse of the taxpayer’s great-uncle;

“great-uncle” of a taxpayer includes the spouse of the taxpayer’s great-aunt;

“gross revenue” of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph replaced);

“group term life insurance policy” means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

“home relocation loan” means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 kilometres greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

“income-averaging annuity” has the meaning assigned by sections 342 and 343;

“income-averaging annuity respecting income from artistic activities” in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

“income bond” or “income debenture” has the meaning assigned by sections 21.12 to 21.15;

“income interest” in a trust by a taxpayer has the meaning assigned by section 683;

“income replacement indemnity” means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (Statutes of Canada, 1996, chapter 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

“incorporeal capital amount” has the meaning assigned by section 106;

“incorporeal capital property” has the meaning assigned by section 250;

“indexed debt obligation” means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

“individual” means a person other than a corporation;

“insurance corporation” has the same meaning as “insurer” ;

“insurance policy” includes a life insurance policy;

“insurer” means a corporation carrying on an insurance business;

“international financial centre” has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

“international traffic”, in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

“inter vivos trust” means a trust other than a testamentary trust;

“inventory” means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

“investment corporation” has the meaning assigned by Book I of Part III;

“joint spousal trust” has the meaning assigned by section 652.1;

“law” includes any Act other than an Act of the Parliament of Québec;

“legal representative” of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

“lending assets” means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

“life insurance business” includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

“life insurance corporation” has the same meaning as “life insurer” ;

“life insurance policy” has the meaning assigned by paragraph e of section 835;

“life insurance policy in Canada” has the meaning assigned by paragraph e.1 of section 835;

“life insurer” means a corporation carrying on a life insurance business other than a business referred to in the definition of “life insurance business”, even if it also carries on a business so described;

“limited partnership loss” in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

“majority interest partner” of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the “taxpayer”,

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

“mineral” includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

“mineral resource” means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

“Minister” means the Minister of Revenue;

“mortgage investment corporation” has the meaning assigned by section 1108;

“motor vehicle” means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

“municipality” includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

“mutual fund corporation” has the meaning assigned by Book III of Part III;

“mutual fund trust” has the meaning assigned by Book IV of Part III;

“net capital loss” has the meaning assigned by section 730;

“net income stabilization account” means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (Statutes of Canada, 1991, chapter 22);

“nephew” of a taxpayer includes the nephew of the taxpayer’s spouse;

“niece” of a taxpayer includes the niece of the taxpayer’s spouse;

“NISA Fund No. 2” means the portion of a taxpayer’s net income stabilization account described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act;

“non-capital loss” has the meaning assigned by section 728;

“non-resident-owned investment corporation” has the meaning assigned by Book V of Part III;

“office” means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

“oil or gas well” means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

“paid-up capital” has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

“passenger vehicle” means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

“pension benefit” includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

“person”, or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

“personal or living expenses” includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

“personal services business” means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an “incorporated employee”, or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

“personal trust” has the meaning assigned by section 649.1;

“personal-use property” has the meaning assigned by section 287;

“post-1971 spousal trust” has the meaning assigned by section 652.1;

“precious property” means a property contemplated in section 265;

“preferred share” means a share other than a common share;

“prescribed class” means a class prescribed under subparagraph e of the first paragraph of section 1086;

“principal amount” in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

“private corporation” has the meaning assigned by paragraph n of section 570;

“private foundation” has the meaning assigned by paragraph e of section 985.1;

“private health services plan” means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (Revised Statutes of Canada, 1985, chapter C-6);

“professional corporation” means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

“profit sharing plan” has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

“property” means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

“property of the bankrupt” has the meaning assigned by the Bankruptcy and Insolvency Act;

“province” means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

“public compensation plan” means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (Revised Statutes of Canada, 1985, chapter C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

“public corporation” has the meaning assigned by paragraph o of section 570;

“public foundation” has the meaning assigned by paragraph f of section 985.1;

“qualified business”, in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

“qualified donee” has the meaning assigned by paragraph b of section 985.1;

“Québec museum” means a museum situated in Québec and any other museum that is a recognized museum at the time the gift is made.

“Québec sales tax” means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

“recognized arts organization” means an arts organization that was recognized, before 30 June 2006, by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in force, but does not include a registered charity and an arts organization that is a registered cultural or communications organization under the second paragraph of section 985.35.12;

“recognized gift with reserve of usufruct or use” by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (Revised Statutes of Canada, 1985, chapter C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or a recognized museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding thirty years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within ten days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

“recognized museum” means a museum that is recognized by the Minister of Culture and Communications and whose recognition is in force;

“recognized political education organization” has the meaning assigned by section 985.36;

“registered Canadian amateur athletic association” has the meaning assigned by section 21.41;

“registered charity” at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

“registered cultural or communications organization” at any time means an organization that is, at that time, registered as such with the Minister in accordance with section 985.35.12;

“registered education savings plan” has the meaning assigned by Title III of Book VII;

“registered museum” at any time means a museum that, at that time, is registered as such with the Minister in accordance with section 985.35.2;

“registered national arts service organization”, at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

“registered pension plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered Québec amateur athletic association” has the meaning assigned by section 21.42;

“registered retirement income fund” means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered retirement plan” means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

“registered retirement savings plan” means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

“registered securities dealer” means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

“registered supplementary unemployment benefit plan” has the meaning assigned by subsection 3 of section 962;

“regulation” means a regulation made by the Government under this Part;

“restricted farm loss” has the meaning assigned by section 207;

“restricted financial institution” means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

“retirement compensation arrangement” has the meaning assigned by section 890.1;

“retirement income fund” has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

“retirement savings plan” has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

“retiring allowance” means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

“salary deferral arrangement” in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

“salary or wages”, except in section 32 and in paragraph a of the definition of “earned income” set out in section 1029.8.67, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

“savings and credit union” has the meaning assigned by section 797;

“scientific research and experimental development” has the meaning assigned by subsections 2 to 4 of section 222;

“self-contained domestic establishment” means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

“servant” means a person engaged in employment;

“share” means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

“shareholder” includes any person entitled to receive payment of a dividend;

“short-term preferred share” has the meaning assigned by sections 21.11.11 to 21.11.13;

“sister” of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

“small business bond” has the meaning assigned by section 119.15;

“small business corporation”, at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

“specified employee” of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

“specified financial institution”, at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of “financial institution” in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the “business entity”, related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

“specified individual” has the meaning assigned by section 766.5;

“specified investment business” has the meaning assigned by section 771.1;

“specified member” of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

“specified shareholder” has the meaning assigned by sections 21.17 and 21.18;

“specified tax consequence” for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

“split income” has the meaning assigned by section 766.5;

“stock dividend” includes any dividend, determined without reference to the definition of “dividend” in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

“subsidiary controlled corporation” means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

“subsidiary wholly-owned corporation” means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

“succession” has the meaning assigned by section 646;

“supplementary unemployment benefit plan” has the meaning assigned by subsection 1 of section 962;

“tar sands” means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

“tax agreement” with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

“tax-agreement-protected business” of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax-agreement-protected property” of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

“tax shelter” has the meaning assigned by section 1079.1;

“taxable Canadian corporation” has the meaning assigned by paragraph m of section 570;

“taxable Canadian property” has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

“taxable capital gain” has the meaning assigned by section 231;

“taxable dividend” has the meaning assigned by paragraph g of section 570;

“taxable income” has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

“taxable net gain” from the disposition of precious property has the meaning assigned by section 265;

“taxable preferred share” has the meaning assigned by sections 21.11.14 to 21.11.16;

“taxable Québec property” has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

“taxation year” means, in the case of a corporation, a fiscal period and, in the case of an individual, a calendar year;

“taxpayer” includes any person whether or not liable to pay tax;

“term preferred share” has the meaning assigned by sections 21.5 to 21.9.5;

“testamentary trust” has the meaning assigned by section 677;

“timber resource property” has the meaning assigned by subparagraph d of the first paragraph of section 93;

“Treasury Board” means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

“trust” has the meaning assigned by section 646;

“uncle” of a taxpayer includes the spouse of the taxpayer’s aunt;

“undepreciated capital cost” of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

“undepreciable property” means any property other than depreciable property;

“unit trust” has the meaning assigned by section 649;

“written separation agreement” includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; 2000, c. 5, s. 4; 2000, c. 8, s. 152; 2000, c. 56, s. 218; 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; 2004, c. 25, s. 70; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24; 2006, c. 36, s. 20.

2006-06-13

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

"accredited museum" means a museum accredited by the Bibliothèque et Archives nationales du Québec(*) and the accreditation of which is in force;

"Act establishing a labour-sponsored fund" means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

"additional voluntary contribution" to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

"adjusted cost base" has the meaning assigned by Chapter III of Title IV of Book III;

"adjustment time" has the meaning assigned by section 107.1;

"advocate" means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

"allowable business investment loss" has the meaning given to it by section 231;

"allowable capital loss" has the meaning assigned by section 231;

"alter ego trust" has the meaning assigned by section 652.1;

"amateur athlete trust" has the meaning assigned by section 851.34;

"amortized cost" of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

"amount" means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

"annuity" includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

"assessment" includes a reassessment and an additional assessment;

"aunt" of a taxpayer includes the spouse of the taxpayer’s uncle;

"authorized foreign bank" has the meaning assigned by section 2 of the Bank Act (Statutes of Canada, 1991, chapter 46);

"automobile" means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(a.1)  a clearly marked emergency medical response vehicle that is used, in connection with or in the course of an individual’s office or employment with an emergency medical response or ambulance service, to carry emergency medical equipment together with one or more emergency medical attendants or paramedics,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 kilometres outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

"balance-due day" of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

"bank" means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

"bankrupt" has the meaning assigned by the Bankruptcy and Insolvency Act (Revised Statutes of Canada, 1985, chapter B-3);

"bankruptcy" has the meaning assigned by the Bankruptcy and Insolvency Act;

"benefit under a deferred profit sharing plan" received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

"bituminous sands" means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

"borrowed money" includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

"brother" of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

"business" includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

"Canada" includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

"Canadian banking business" means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

"Canadian-controlled private corporation" has the meaning assigned by section 21.19;

"Canadian corporation" has the meaning assigned by paragraph l of section 570;

"Canadian development expenses" has the meaning assigned by sections 408 to 410;

"Canadian exploration and development expenses" has the meaning assigned by sections 364 to 366;

"Canadian exploration expenses" has the meaning assigned by sections 395 to 397;

"Canadian oil and gas property expense" has the meaning assigned by sections 418.2 to 418.4;

"Canadian partnership" has the meaning assigned by section 599;

"Canadian resource property" has the meaning assigned by section 370;

"Canadian stock exchange" means a prescribed Canadian stock exchange;

"capital dividend" has the meaning assigned by sections 502 to 502.0.4;

"capital interest" in a trust by a taxpayer has the meaning assigned by section 683;

"capital property" has the meaning assigned by section 249;

"cash method" has the meaning assigned by section 194;

"cemetery care trust" has the meaning assigned by section 979.19;

"certified archival centre" means an archival centre certified by the Minister of Culture and Communications and the certification of which is in force;

"charity" means a charitable organization or charitable foundation, within the meaning of section 985.1;

"child" of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

"common share" means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

"compensation for the loss of financial support" means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

"corporation incorporated in Canada" includes any corporation incorporated in any region of Canada before or after it became part of Canada;

"cost amount" to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

"(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;";

"i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;";

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

"death benefit" has the meaning assigned by section 3;

"deferred amount" at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

"deferred profit sharing plan" has the meaning assigned by section 870;

"depreciable property" has the meaning assigned by subparagraph c of the first paragraph of section 93;

"designated insurance property" has the meaning assigned by section 818;

"development bond" has the meaning assigned by section 119.2;

"disposition" has the meaning assigned by section 248;

"dividend" includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

"dividend rental arrangement" of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

"eligible funeral arrangement" has the meaning assigned by section 979.19;

"eligible incorporeal capital amount" has the meaning assigned by section 107;

"eligible relocation" has the meaning assigned by the first paragraph of section 349.1;

"employee" means any person employed or holding an office;

"employee benefit plan" has the meaning assigned by section 47.6;

"employee trust" has the meaning assigned by sections 47.7 to 47.9;

"employer", in relation to an employee, means the person from whom the employee receives remuneration;

"employment" means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

"environmental trust" has the meaning assigned by section 21.40;

"establishment" has the meaning assigned to it by sections 12 to 16.2;

"exempt income" means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

"farm income stabilization account" means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

"farming" includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

"farm loss" has the meaning assigned by section 728.2;

"filing-due date" of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

"fishing" includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

"flow-through share" has the meaning assigned by section 359.1;

"foreign affiliate" has the meaning assigned by section 571;

"foreign currency" means currency of a foreign country;

"foreign exploration and development expenses" has the meaning assigned by sections 372 and 372.1;

"foreign resource expense" has the meaning assigned by sections 418.1.1 and 418.1.2;

"foreign resource pool expenses" of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

"foreign resource property" has the meaning assigned by section 373;

"foreign retirement arrangement" means a prescribed plan or arrangement;

"foreign stock exchange" means a prescribed foreign stock exchange;

"former business property" of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property or an interest therein of the taxpayer, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression "former business property" is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

"goods and services tax" means the tax payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

"grandfather" of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

"grandfathered share" has the meaning assigned by sections 21.11.20 and 21.11.21;

"grandmother" of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

"great-aunt" of a taxpayer includes the spouse of the taxpayer’s great-uncle;

"great-uncle" of a taxpayer includes the spouse of the taxpayer’s great-aunt;

"gross revenue" of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph repealed);

"group term life insurance policy" means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

"home relocation loan" means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 kilometres greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

"income-averaging annuity" has the meaning assigned by sections 342 and 343;

"income-averaging annuity respecting income from artistic activities" in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

"income bond" or "income debenture" has the meaning assigned by sections 21.12 to 21.15;

"income interest" in a trust by a taxpayer has the meaning assigned by section 683;

"income replacement indemnity" means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (Statutes of Canada, 1996, chapter 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

"incorporeal capital amount" has the meaning assigned by section 106;

"incorporeal capital property" has the meaning assigned by section 250;

"indexed debt obligation" means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

"individual" means a person other than a corporation;

"insurance corporation" has the same meaning as "insurer";

"insurance policy" includes a life insurance policy;

"insurer" means a corporation carrying on an insurance business;

"international financial centre" has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

"international traffic", in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

"inter vivos trust" means a trust other than a testamentary trust;

"inventory" means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

"investment corporation" has the meaning assigned by Book I of Part III;

"joint spousal trust" has the meaning assigned by section 652.1;

"law" includes any Act other than an Act of the Parliament of Québec;

"legal representative" of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

"lending assets" means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

"life insurance business" includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

"life insurance corporation" has the same meaning as "life insurer";

"life insurance policy" has the meaning assigned by paragraph e of section 835;

"life insurance policy in Canada" has the meaning assigned by paragraph e.1 of section 835;

"life insurer" means a corporation carrying on a life insurance business other than a business referred to in the definition of "life insurance business", even if it also carries on a business so described;

"limited partnership loss" in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

"majority interest partner" of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the "taxpayer",

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

"mineral" includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

"mineral resource" means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources and Wildlife;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

"Minister" means the Minister of Revenue;

"mortgage investment corporation" has the meaning assigned by section 1108;

"motor vehicle" means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

"municipality" includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

"mutual fund corporation" has the meaning assigned by Book III of Part III;

"mutual fund trust" has the meaning assigned by Book IV of Part III;

"net capital loss" has the meaning assigned by section 730;

"net income stabilization account" means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (Statutes of Canada, 1991, chapter 22);

"nephew" of a taxpayer includes the nephew of the taxpayer’s spouse;

"niece" of a taxpayer includes the niece of the taxpayer’s spouse;

"NISA Fund No. 2" means the portion of a taxpayer’s net income stabilization account described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act;

"non-capital loss" has the meaning assigned by section 728;

"non-resident-owned investment corporation" has the meaning assigned by Book V of Part III;

"office" means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

"oil or gas well" means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

"paid-up capital" has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

"passenger vehicle" means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

"pension benefit" includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

"person", or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

"personal or living expenses" includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

"personal services business" means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an "incorporated employee", or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

"personal trust" has the meaning assigned by section 649.1;

"personal-use property" has the meaning assigned by section 287;

"post-1971 spousal trust" has the meaning assigned by section 652.1;

"precious property" means a property contemplated in section 265;

"preferred share" means a share other than a common share;

"prescribed class" means a class prescribed under subparagraph e of the first paragraph of section 1086;

"principal amount" in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

"private corporation" has the meaning assigned by paragraph n of section 570;

"private foundation" has the meaning assigned by paragraph e of section 985.1;

"private health services plan" means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (Revised Statutes of Canada, 1985, chapter C-6);

"professional corporation" means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

"profit sharing plan" has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

"property" means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

"property of the bankrupt" has the meaning assigned by the Bankruptcy and Insolvency Act;

"province" means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

"public compensation plan" means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (Revised Statutes of Canada, 1985, chapter C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

"public corporation" has the meaning assigned by paragraph o of section 570;

"public foundation" has the meaning assigned by paragraph f of section 985.1;

"qualified business", in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

"qualified donee" has the meaning assigned by paragraph b of section 985.1;

"Québec museum" means a museum situated in Québec and any other museum that is an accredited museum at the time the gift is made.

"Québec sales tax" means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

"recognized arts organization" means an arts organization that is recognized by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in effect, but does not include a registered charity;

"recognized gift with reserve of usufruct or use" by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (Revised Statutes of Canada, 1985, chapter C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or an accredited museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding thirty years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within ten days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

"recognized political education organization" has the meaning assigned by section 985.36;

"registered Canadian amateur athletic association" has the meaning assigned by section 21.41;

"registered charity" at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

"registered education savings plan" has the meaning assigned by Title III of Book VII;

"registered national arts service organization", at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

"registered pension plan" means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

"registered Québec amateur athletic association" has the meaning assigned by section 21.42;

"registered retirement income fund" means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

"registered retirement plan" means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

"registered retirement savings plan" means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

"registered securities dealer" means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

"registered supplementary unemployment benefit plan" has the meaning assigned by subsection 3 of section 962;

"regulation" means a regulation made by the Government under this Part;

"restricted farm loss" has the meaning assigned by section 207;

"restricted financial institution" means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of "financial institution" in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

"retirement compensation arrangement" has the meaning assigned by section 890.1;

"retirement income fund" has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

"retirement savings plan" has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

"retiring allowance" means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

"salary deferral arrangement" in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

"salary or wages", except in section 32 and in paragraph a of the definition of "earned income" set out in section 1029.8.67, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

"savings and credit union" has the meaning assigned by section 797;

"scientific research and experimental development" has the meaning assigned by subsections 2 to 4 of section 222;

"self-contained domestic establishment" means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

"servant" means a person engaged in employment;

"share" means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

"shareholder" includes any person entitled to receive payment of a dividend;

"short-term preferred share" has the meaning assigned by sections 21.11.11 to 21.11.13;

"sister" of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

"small business bond" has the meaning assigned by section 119.15;

"small business corporation", at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

"specified employee" of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

"specified financial institution", at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of "financial institution" in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the "business entity", related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

"specified individual" has the meaning assigned by section 766.5;

"specified investment business" has the meaning assigned by section 771.1;

"specified member" of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

"specified shareholder" has the meaning assigned by sections 21.17 and 21.18;

"specified tax consequence" for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

"split income" has the meaning assigned by section 766.5;

"stock dividend" includes any dividend, determined without reference to the definition of "dividend" in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

"subsidiary controlled corporation" means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

"subsidiary wholly-owned corporation" means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

"succession" has the meaning assigned by section 646;

"supplementary unemployment benefit plan" has the meaning assigned by subsection 1 of section 962;

"tar sands" means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

"tax agreement" with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

"tax-agreement-protected business" of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

"tax-agreement-protected property" of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

"tax shelter" has the meaning assigned by section 1079.1;

"taxable Canadian corporation" has the meaning assigned by paragraph m of section 570;

"taxable Canadian property" has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

"taxable capital gain" has the meaning assigned by section 231;

"taxable dividend" has the meaning assigned by paragraph g of section 570;

"taxable income" has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

"taxable net gain" from the disposition of precious property has the meaning assigned by section 265;

"taxable preferred share" has the meaning assigned by sections 21.11.14 to 21.11.16;

"taxable Québec property" has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

"taxation year" means, in the case of a corporation, a fiscal period and, in the case of an individual, a calendar year;

"taxpayer" includes any person whether or not liable to pay tax;

"term preferred share" has the meaning assigned by sections 21.5 to 21.9.5;

"testamentary trust" has the meaning assigned by section 677;

"timber resource property" has the meaning assigned by subparagraph d of the first paragraph of section 93;

"Treasury Board" means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

"trust" has the meaning assigned by section 646;

"uncle" of a taxpayer includes the spouse of the taxpayer’s aunt;

"undepreciated capital cost" of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

"undepreciable property" means any property other than depreciable property;

"unit trust" has the meaning assigned by section 649;

"written separation agreement" includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; O.C. 149-2000; 2000, c. 5, s. 4; 2000, c. 8, s. 152; O.C. 1027-2000; 2000, c. 56, s. 218(12); 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; O.C. 45-2004; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; [(*): since January 31, 2006, a reference to the Minister of Culture and Communications concerning the national archives of Québec is a reference to Bibliothèque et Archives nationales du Québec: 2004, c. 25, s. 70 and O.C. 1295-2005;]; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44; 2006, c. 3, s. 35; 2006, c. 13, s. 24.

2006-03-01

1. In this Part and in the regulations, unless the context indicates a different meaning, the expression:

"accredited museum" means a museum accredited by the Bibliothèque et Archives nationales du Québec(*) and the accreditation of which is in force;

"Act establishing a labour-sponsored fund" means

(a)  the Act to establish Fondaction, le Fonds de développement de la Confédération des syndicats nationaux pour la coopération et l’emploi (chapter F-3.1.2); or

(b)  the Act to establish the Fonds de solidarité des travailleurs du Québec (F.T.Q.) (chapter F-3.2.1);

"additional voluntary contribution" to a registered pension plan means a contribution that is made by a member to the plan, that is used to provide benefits under a money purchase provision, within the meaning of section 965.0.1, of the plan and that is not required as a general condition of membership in the plan;

"adjusted cost base" has the meaning assigned by Chapter III of Title IV of Book III;

"adjustment time" has the meaning assigned by section 107.1;

"advocate" means an advocate or a notary and, in another Canadian province, a barrister or a solicitor;

"allowable business investment loss" has the meaning given to it by section 231;

"allowable capital loss" has the meaning assigned by section 231;

"alter ego trust" has the meaning assigned by section 652.1;

"amateur athlete trust" has the meaning assigned by section 851.34;

"amortized cost" of a loan or lending asset has the meaning assigned by sections 21.26 and 21.27;

"amount" means money, rights or things expressed in terms of an amount of money or their value in terms of money, except that

(a)  in any case where section 187.2 or 187.3 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) or any of sections 21.4.3, 21.10, 21.10.1, 740.1 to 740.3.1 and 740.5 applies to a stock dividend, the amount of the stock dividend is equal to the greater of

i.  the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend, and

ii.  the fair market value of the share or shares paid as a stock dividend at the time of payment;

(b)  in any other case, the amount of any stock dividend is equal to the amount by which the paid-up capital of the corporation that paid the dividend is increased by reason of the payment of the dividend;

"annuity" includes an amount payable on a periodic basis whether payable at intervals longer or shorter than a year, under a contract, will, trust or otherwise;

"assessment" includes a reassessment and an additional assessment;

"aunt" of a taxpayer includes the spouse of the taxpayer’s uncle;

"authorized foreign bank" has the meaning assigned by section 2 of the Bank Act (Statutes of Canada, 1991, chapter 46);

"automobile" means a motor vehicle that is designed or adapted primarily to carry individuals on highways and streets and that has a seating capacity for not more than the driver and 8 passengers, but does not include

(a)  an ambulance,

(b)  a motor vehicle acquired or leased primarily for use as a taxi, a bus used in a business of transporting passengers or a hearse used in the course of a business of arranging or managing funerals,

(c)  except for the purposes of sections 36 to 47.17, a motor vehicle acquired or leased to be sold or leased in the course of carrying on a business of selling or leasing motor vehicles or a motor vehicle used for the purpose of transporting passengers in the course of carrying on a business of arranging or managing funerals, and

(d)  a motor vehicle

i.  of a type commonly called a van or pick-up truck or a similar vehicle

(1)  that has a seating capacity for not more than the driver and two passengers and that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods or equipment in the course of gaining or producing income, or

(2)  the use of which, in the taxation year in which it is acquired or leased, is all or substantially all for the transportation of goods, equipment or passengers in the course of gaining or producing income, or

ii.  of a type commonly called a pick-up truck that, in the taxation year in which it is acquired or leased, is used primarily for the transportation of goods, equipment or passengers in the course of gaining or producing income at one or more locations in Canada that are

(1)  described in subparagraph i or ii of paragraph a of section 42, in respect of any of the occupants of the vehicle, and

(2)  at least 30 kilometres outside the nearest point on the boundary of the nearest urban area, as defined by the last census dictionary published by Statistics Canada before the year, that has a population of at least 40,000 individuals as determined in the last census published by Statistics Canada before the year;

"balance-due day" of a taxpayer for a taxation year means

(a)  where the taxpayer is a corporation, the last day of the two-month period ending after the end of the year;

(b)  where the taxpayer is a trust, the day that is 90 days after the end of the year;

(c)  where the taxpayer is a person who died in the year, or after the end of the year but on or before 30 April in the following calendar year, the later of 30 April in that calendar year and the day that is six months after the day of death;

(d)  in the case of any other person, 30 April in the following calendar year;

"bank" means a bank within the meaning of section 2 of the Bank Act or an authorized foreign bank;

"bankrupt" has the meaning assigned by the Bankruptcy and Insolvency Act (Revised Statutes of Canada, 1985, chapter B-3);

"bankruptcy" has the meaning assigned by the Bankruptcy and Insolvency Act;

"benefit under a deferred profit sharing plan" received by a taxpayer in a taxation year means the total of all the amounts received by the taxpayer in the year from a trustee under the plan, minus any amounts deductible under sections 883 and 884 in computing the taxpayer’s income for the year;

"bituminous sands" means sands or other rock materials containing naturally occurring hydrocarbons, other than coal, which hydrocarbons have

(a)  a viscosity, determined in a prescribed manner, equal to or greater than 10,000 centipoise; or

(b)  a density, determined in a prescribed manner, equal to or less than 12 degrees API;

"borrowed money" includes the proceeds to a taxpayer from the sale of a post-dated bill drawn by the taxpayer on a bank;

"brother" of a taxpayer includes the brother of the taxpayer’s spouse and the spouse of the taxpayer’s sister;

"business" includes a profession, calling, trade, manufacture or undertaking of any kind whatsoever and, except for the purposes of subparagraph a of the first paragraph of section 164, section 250.4 and subparagraph i of the second paragraph of section 726.6.1, an adventure or concern in the nature of trade but does not include an office or employment;

"Canada" includes

(a)  the sea bed and subsoil of the submarine areas adjacent to the coasts of Canada in respect of which the Government of Canada or of a province grants a right, licence or privilege to explore for, drill for or take any minerals, petroleum, natural gas or any related hydrocarbons; and

(b)  the seas and airspace above the submarine areas referred to in paragraph a in respect of any activities carried on in connection with the exploration for or exploitation of any resource referred to in that paragraph;

"Canadian banking business" means the business carried on by an authorized foreign bank through an establishment in Canada, other than business conducted through a representative office registered or required to be registered under section 509 of the Bank Act;

"Canadian-controlled private corporation" has the meaning assigned by section 21.19;

"Canadian corporation" has the meaning assigned by paragraph l of section 570;

"Canadian development expenses" has the meaning assigned by sections 408 to 410;

"Canadian exploration and development expenses" has the meaning assigned by sections 364 to 366;

"Canadian exploration expenses" has the meaning assigned by sections 395 to 397;

"Canadian oil and gas property expense" has the meaning assigned by sections 418.2 to 418.4;

"Canadian partnership" has the meaning assigned by section 599;

"Canadian resource property" has the meaning assigned by section 370;

"Canadian stock exchange" means a prescribed Canadian stock exchange;

"capital dividend" has the meaning assigned by sections 502 to 502.0.4;

"capital interest" in a trust by a taxpayer has the meaning assigned by section 683;

"capital property" has the meaning assigned by section 249;

"cash method" has the meaning assigned by section 194;

"cemetery care trust" has the meaning assigned by section 979.19;

"certified archival centre" means an archival centre certified by the Minister of Culture and Communications and the certification of which is in force;

"charity" means a charitable organization or charitable foundation, within the meaning of section 985.1;

"child" of a taxpayer includes:

(a)  (subparagraph repealed);

(b)  a person who is wholly dependent on the taxpayer for support and of whom the taxpayer has, or immediately before such person attained the age of 19 years did have, in law or in fact, the custody and control;

(c)  the spouse of a child of the taxpayer; and

(d)  a child of the taxpayer’s spouse;

"common share" means a share the holder of which is not precluded, upon the reduction or redemption of the capital stock, from participating in the assets of the corporation beyond the amount then paid for that share plus a fixed premium and a defined rate of dividend;

"compensation for the loss of financial support" means a benefit payable under a public compensation plan in the form of a pension or a lump sum in lieu of a pension that is granted following the death of the victim of an accident, employment injury or bodily injury to a person who, under the terms of the public compensation plan, is the victim’s surviving spouse or a person who is considered to have been the victim’s dependant;

"corporation incorporated in Canada" includes any corporation incorporated in any region of Canada before or after it became part of Canada;

"cost amount" to a taxpayer of any property at any time means:

(a)  in the case of depreciable property of a prescribed class, the amount that would be that proportion of the undepreciated capital cost to the taxpayer of property of that class at that time that the capital cost to the taxpayer of the property is of the capital cost to the taxpayer of all property of that class that has not been disposed of by the taxpayer before that time if section 99 were read without reference to paragraph d.1 thereof and if paragraph b and subparagraph i of paragraph d of that section were read as follows:

"(b) subject to section 284, where a taxpayer, having acquired property for some other purpose, begins at a particular time to use it to gain income, the taxpayer is deemed to have acquired it at that particular time at a capital cost to the taxpayer equal to the fair market value of the property at that time;";

"i. where the proportion of the use made of the property to gain income has increased at a particular time, the taxpayer is deemed to have acquired at that time depreciable property of that class at a capital cost equal to the proportion of the fair market value of the property at that time that the amount of the increase in the use regularly made by the taxpayer of the property to gain income is of the whole of the use made of it;";

(b)  in the case of capital property, other than depreciable property, of the taxpayer, its adjusted cost base to the taxpayer at that time;

(c)  in the case of property described in an inventory of the taxpayer, its value at that time as determined for the purpose of computing the taxpayer’s income;

(c.1)  where the taxpayer is a financial institution, within the meaning assigned by section 851.22.1, in its taxation year that includes that time and the property is mark-to-market property, within the meaning assigned by that section, for the year, the cost to the taxpayer of the property;

(d)  in the case of incorporeal capital property of the taxpayer in respect of a business, 4/3 of the amount that would, but for section 106.1, be the proportion of the eligible incorporeal capital amount of the taxpayer in respect of the business at that time that the fair market value, at that time, of the incorporeal capital property is of the fair market value, at that time, of the aggregate of incorporeal capital properties of the taxpayer in respect of the business;

(d.1)  where the property was a loan or lending asset, other than a net income stabilization account, a farm income stabilization account or a property in respect of which any of paragraphs b to c.1 and d.2 applies, the amortized cost of the property to the taxpayer at that time;

(d.2)  where the taxpayer is a financial institution within the meaning assigned by section 851.22.1 in its taxation year that includes that time and the property is a specified debt obligation within the meaning assigned by that section, other than a mark-to-market property within the meaning assigned by that section for the year, the tax basis, within the meaning assigned by section 851.22.7, of the property to the taxpayer at that time;

(e)  where the property was a right of the taxpayer to receive an amount, other than property that is a debt the amount of which was deducted under section 141 in computing the taxpayer’s income for a taxation year that ended before that time, a net income stabilization account, a farm income stabilization account, a right in respect of which any of paragraphs b to c.1, d.1 and d.2 applies, or a right to receive production, as defined in section 158.1, to which a matchable expenditure, as defined in section 158.1, relates, the amount the taxpayer has a right to receive;

(e.1)  in the case of a policy loan, within the meaning assigned by paragraph h of section 835, of an insurer or an interest of a beneficiary under an environmental trust, an amount equal to zero;

(f)  in any other case, the cost to the taxpayer of the property as determined for the purpose of computing the taxpayer’s income, except to the extent that that cost has been deducted in computing the taxpayer’s income for any taxation year ending before that time;

"death benefit" has the meaning assigned by section 3;

"deferred amount" at the end of a taxation year under a salary deferral arrangement in respect of an individual has the meaning assigned by section 47.17;

"deferred profit sharing plan" has the meaning assigned by section 870;

"depreciable property" has the meaning assigned by subparagraph c of the first paragraph of section 93;

"designated insurance property" has the meaning assigned by section 818;

"development bond" has the meaning assigned by section 119.2;

"disposition" has the meaning assigned by section 248;

"dividend" includes a stock dividend, other than a stock dividend that is paid to a corporation or to a mutual fund trust by a corporation that is not resident in Canada;

"dividend rental arrangement" of a person means any arrangement entered into by the person where it may reasonably be considered that the main reason for the person entering into the arrangement is to enable the person to receive a dividend on a share of the capital stock of a corporation, other than a dividend on a prescribed share or a share described in section 21.6.1 or an amount deemed, by reason of the first paragraph of section 119, to be received as a dividend on a share of the capital stock of a corporation, and under the arrangement someone other than that person enjoys the opportunity for profit or gain or bears the risk of loss with respect to the share in any material respect, and includes any arrangement under which

(a)  a corporation at any time receives on a particular share a taxable dividend that would, but for section 740.4.1, be deductible in computing its taxable income for the taxation year that includes that time, and

(b)  the corporation is obligated to pay to another person an amount as compensation for any of the following dividends that, if paid, would be deemed by section 21.32 to have been received by that other person as a taxable dividend:

i.  the dividend referred to in paragraph a,

ii.  a dividend on a share that is identical to the particular share, or

iii.  a dividend on a share that, during the term of the arrangement, can reasonably be expected to provide to a holder of the share the same or substantially the same proportionate opportunity for gain or risk of loss as the particular share;

"eligible funeral arrangement" has the meaning assigned by section 979.19;

"eligible incorporeal capital amount" has the meaning assigned by section 107;

"eligible relocation" has the meaning assigned by the first paragraph of section 349.1;

"employee" means any person employed or holding an office;

"employee benefit plan" has the meaning assigned by section 47.6;

"employee trust" has the meaning assigned by sections 47.7 to 47.9;

"employer", in relation to an employee, means the person from whom the employee receives remuneration;

"employment" means the position of an individual in the service of some other person, including the State, Her Majesty or a foreign state or sovereign;

"environmental trust" has the meaning assigned by section 21.40;

"establishment" has the meaning assigned to it by sections 12 to 16.2;

"exempt income" means property received or acquired by a person in such circumstances that it is, because of any provision of this Part, not included in computing the person’s income, but does not include a dividend on a share;

"farm income stabilization account" means an account of a person or partnership under the Farm Income Stabilization Account program established under the Act respecting La Financière agricole du Québec (chapter L-0.1);

"farming" includes livestock raising or exhibiting, maintaining of horses for racing, raising of poultry, fur farming, dairy farming, fruit growing and the keeping of bees, but does not include an office or employment under a person engaged in the business of farming;

"farm loss" has the meaning assigned by section 728.2;

"filing-due date" of a taxpayer for a taxation year means the day on or before which the taxpayer’s fiscal return under this Part for the year is required to be filed or would be required to be filed if tax under this Part were payable by the taxpayer for the year;

"fishing" includes fishing for or catching shell fish, crustaceans and marine animals but does not include an office or employment under a person engaged in the business of fishing;

"flow-through share" has the meaning assigned by section 359.1;

"foreign affiliate" has the meaning assigned by section 571;

"foreign currency" means currency of a foreign country;

"foreign exploration and development expenses" has the meaning assigned by sections 372 and 372.1;

"foreign resource expense" has the meaning assigned by sections 418.1.1 and 418.1.2;

"foreign resource pool expenses" of a taxpayer means the taxpayer’s foreign resource expenses in relation to all countries and the taxpayer’s foreign exploration and development expenses;

"foreign resource property" has the meaning assigned by section 373;

"foreign retirement arrangement" means a prescribed plan or arrangement;

"foreign stock exchange" means a prescribed foreign stock exchange;

"former business property" of a taxpayer means a capital property of the taxpayer that was used by the taxpayer or a person related to the taxpayer primarily for the purpose of gaining or producing income from a business and that was immovable property or an interest therein of the taxpayer, but does not include

(a)  immovable property owned by the taxpayer, whether jointly with another person or otherwise, and used by the taxpayer in the taxation year to which the expression "former business property" is being applied principally for the purpose of gaining or producing gross revenue that is rent, other than property either leased by the taxpayer to a person related to the taxpayer and used by that related person principally for any other purpose, or leased by the taxpayer or the related person to a lessee, in the ordinary course of a business of the taxpayer or the related person of selling goods or rendering services, under a contract by which the lessee undertakes to use the property to carry on the business of selling or promoting the sale of the goods or services of the taxpayer or the related person,

(b)  land subjacent to a property referred to in paragraph a,

(c)  land contiguous to land referred to in paragraph b that is a parking area, driveway, yard or garden or that is otherwise necessary for the use of the property referred to in paragraph a, or

(d)  a leasehold interest in any property described in paragraphs a, b and c;

"goods and services tax" means the tax payable under Part IX of the Excise Tax Act (Revised Statutes of Canada, 1985, chapter E-15);

"grandfather" of a taxpayer includes the grandfather of the taxpayer’s spouse and the spouse of the taxpayer’s grandmother;

"grandfathered share" has the meaning assigned by sections 21.11.20 and 21.11.21;

"grandmother" of a taxpayer includes the grandmother of the taxpayer’s spouse and the spouse of the taxpayer’s grandfather;

"great-aunt" of a taxpayer includes the spouse of the taxpayer’s great-uncle;

"great-uncle" of a taxpayer includes the spouse of the taxpayer’s great-aunt;

"gross revenue" of a taxpayer for a taxation year means the aggregate of:

(a)  all amounts received or receivable in the year, depending on the method regularly followed by the taxpayer in computing the taxpayer’s income, otherwise than as or on account of capital; and

(b)  all amounts, other than amounts referred to in paragraph a, included in computing the taxpayer’s income from a business or property for the year by virtue of section 89, 92 or 92.1 or any of sections 92.11 to 92.19;

(c)  (paragraph repealed);

"group term life insurance policy" means a group life insurance policy under which the only amounts payable by the insurer are

(a)  amounts payable on the death or disability of individuals whose lives are insured because of, or in the course of, their office or employment or former office or employment, and

(b)  policy dividends or experience rating refunds;

"home relocation loan" means a loan made to an individual or the individual’s spouse in circumstances where the individual has commenced employment at a new work location in Canada and by reason thereof has moved from the old residence in Canada at which, before the move, the individual ordinarily resided to a new residence in Canada at which, after the move, the individual ordinarily resides, if

(a)  the distance between the old residence and the new work location is at least 40 kilometres greater than the distance between the new residence and the new work location;

(b)  the loan is used to acquire a dwelling, or a share of the capital stock of a housing cooperative acquired for the sole purpose of acquiring the right to inhabit a dwelling owned by the cooperative, where the dwelling is for the habitation of the individual and is the individual’s new residence;

(c)  the loan is received in the circumstances described in section 487.1, or would have been so received if the second paragraph of section 487.1 had applied to the loan at the time it was received; and

(d)  the loan is designated by the individual to be a home relocation loan, but in no case shall more than one loan in respect of a particular move, or more than one loan at any particular time, be designated as a home relocation loan by the individual;

"income-averaging annuity" has the meaning assigned by sections 342 and 343;

"income-averaging annuity respecting income from artistic activities" in relation to an individual means, except for the purposes of Chapter VI.0.1 of Title VI of Book III, an annuity established under a contract that meets the conditions set out in section 346.0.2 and in respect of which the individual has deducted an amount in computing the individual’s income under section 346.0.1;

"income bond" or "income debenture" has the meaning assigned by sections 21.12 to 21.15;

"income interest" in a trust by a taxpayer has the meaning assigned by section 683;

"income replacement indemnity" means a benefit paid under a public compensation plan to compensate a total or partial disability affecting a person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business, or to compensate the loss of a benefit under the Employment Insurance Act (Statutes of Canada, 1996, chapter 23), unless, under the terms of the public compensation plan, no employer, whether required or not to pay all or part of the benefit, may be reimbursed for the expense incurred by the employer in that respect; for that purpose, a benefit computed by reference to a person’s recognized earnings under the public compensation plan is deemed a benefit paid to compensate the total or partial disability affecting the person’s capacity to perform the duties of an office or employment or to carry on a business either alone or as a partner actively engaged in the business;

"incorporeal capital amount" has the meaning assigned by section 106;

"incorporeal capital property" has the meaning assigned by section 250;

"indexed debt obligation" means a debt obligation the terms or conditions of which provide for an adjustment to an amount payable in respect of the obligation for a period during which the obligation was outstanding that is determined by reference to a change in the purchasing power of money;

"individual" means a person other than a corporation;

"insurance corporation" has the same meaning as "insurer";

"insurance policy" includes a life insurance policy;

"insurer" means a corporation carrying on an insurance business;

"international financial centre" has the meaning assigned by section 6 of the Act respecting international financial centres (chapter C-8.3);

"international traffic", in respect of a person not resident in Canada who carries on a transportation business, means a voyage made in the course of that business, to transport persons or goods between two places outside Canada or between Canada and a place outside Canada;

"inter vivos trust" means a trust other than a testamentary trust;

"inventory" means a description of property the cost or value of which is relevant in computing a taxpayer’s income from a business for a taxation year or would have been so relevant if the income from the business had not been computed in accordance with the cash method and, with respect to a farming business, includes all of the livestock held in the course of carrying on the business;

"investment corporation" has the meaning assigned by Book I of Part III;

"joint spousal trust" has the meaning assigned by section 652.1;

"law" includes any Act other than an Act of the Parliament of Québec;

"legal representative" of a taxpayer means a trustee in bankruptcy, an assignee, a receiver, a trustee, an heir, an administrator of the property of others, or any other like person, administering, winding up, controlling or otherwise dealing in a representative or fiduciary capacity with the property that belongs or belonged to, or that is or was held for the benefit of, the taxpayer or the taxpayer’s succession;

"lending assets" means a bond, debenture, note, hypothecary claim, mortgage, agreement of sale or any other indebtedness, or a prescribed share, but does not include a prescribed property;

"life insurance business" includes the business of issuing contracts in respect of which all or any part of the issuer’s reserves vary depending upon the fair market value of a specified group of assets, and an annuities business, carried on by a life insurer;

"life insurance corporation" has the same meaning as "life insurer";

"life insurance policy" has the meaning assigned by paragraph e of section 835;

"life insurance policy in Canada" has the meaning assigned by paragraph e.1 of section 835;

"life insurer" means a corporation carrying on a life insurance business other than a business referred to in the definition of "life insurance business", even if it also carries on a business so described;

"limited partnership loss" in respect of the partnership has the meaning assigned by sections 613.1 and 726.4.17.11;

"majority interest partner" of a particular partnership at any time means a person or partnership, in paragraphs a and b referred to as the "taxpayer",

(a)  whose share of the particular partnership’s income from all sources for the fiscal period of the particular partnership that ended before that time or, if the particular partnership’s first fiscal period includes that time, for that fiscal period, would have exceeded 1/2 of the particular partnership’s income from all sources for that period if the taxpayer had held throughout that fiscal period each interest in the particular partnership that the taxpayer or a person affiliated with the taxpayer held at that time; or

(b)  whose share, together with the shares of every person with whom the taxpayer is affiliated, of the total amount that would be paid to all members of the particular partnership, otherwise than as a share of any income of the particular partnership, if it were wound up at that time exceeds 1/2 of that total amount;

"mineral" includes ammonite gemstone, coal, calcium chloride, kaolin, bituminous sands, oil shale and silica, but does not include petroleum, natural gas or other related hydrocarbons;

"mineral resource" means a base or precious metal deposit, a coal deposit, a bituminous sands deposit or oil shale deposit, or a mineral deposit in respect of which the principal mineral extracted is

(a)  an industrial mineral contained in a non-bedded deposit, as certified by the Minister of Natural Resources, Wildlife and Parks;

(b)  ammonite gemstone, calcium chloride, diamond, gypsum, halite, kaolin or sylvite;

(c)  silica that is extracted from sandstone or quartzite;

"Minister" means the Minister of Revenue;

"mortgage investment corporation" has the meaning assigned by section 1108;

"motor vehicle" means an automotive vehicle designed or adapted to be used on highways and streets, other than a trolleybus or a vehicle designed or adapted to be operated exclusively on rails;

"municipality" includes a metropolitan community and the Kativik Regional Government, established under the Act respecting Northern villages and the Kativik Regional Government (chapter V-6.1);

"mutual fund corporation" has the meaning assigned by Book III of Part III;

"mutual fund trust" has the meaning assigned by Book IV of Part III;

"net capital loss" has the meaning assigned by section 730;

"net income stabilization account" means an account of a taxpayer under the net income stabilization account program under the Farm Income Protection Act (Statutes of Canada, 1991, chapter 22);

"nephew" of a taxpayer includes the nephew of the taxpayer’s spouse;

"niece" of a taxpayer includes the niece of the taxpayer’s spouse;

"NISA Fund No. 2" means the portion of a taxpayer’s net income stabilization account described in paragraph b of subsection 2 of section 8 of the Farm Income Protection Act;

"non-capital loss" has the meaning assigned by section 728;

"non-resident-owned investment corporation" has the meaning assigned by Book V of Part III;

"office" means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the State or Crown, the office of a member of a legislative assembly, a member of the Senate or House of Commons of Canada or a member of an executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity, and also includes the position of member of the board of directors of a corporation even where the individual neither performs administrative functions within the corporation nor receives stipends or a remuneration to hold that position;

"oil or gas well" means any well, other than an exploratory probe or a well drilled from below the surface of the earth, drilled for the purpose of producing petroleum or natural gas or of determining the existence, location, extent or quality of a natural accumulation of petroleum or natural gas, but, for the purpose of applying sections 93 to 104 and 130 and any regulations made for the purpose of paragraph a of section 130 in respect of property acquired after 6 March 1996, does not include a well for the extraction of material from a deposit of bituminous sands or oil shales;

"paid-up capital" has the meaning assigned by paragraph a of section 570, except for the purposes of Titles VI.1 and VI.2 of Book VII and Title V of Book IX, excluding sections 1045 to 1049;

"passenger vehicle" means an automobile acquired after 17 June 1987, other than an automobile acquired after that date pursuant to an obligation in writing entered into before 18 June 1987, and an automobile leased under a lease entered into, extended or renewed after 17 June 1987;

"pension benefit" includes any amount received under a pension plan and also includes any payment made to a beneficiary under the plan, or to an employer or former employer of the beneficiary in accordance with the conditions of the plan, following any change made in it or resulting from its winding-up;

"person", or any word or expression descriptive of a person, includes any corporation, and any entity exempt, because of Book VIII, from tax under this Part and the legal representatives of such a person, according to the law of that part of Canada to which the context extends;

"personal or living expenses" includes:

(a)  the expenses of properties maintained by any person for the use or benefit of the taxpayer or any person connected with the taxpayer by blood relationship, marriage or adoption, but does not include expenses in respect of properties maintained in connection with a business carried on for profit or with a reasonable expectation of profit;

(b)  the expenses, premiums or other costs of an insurance policy, annuity contract or other like contract if the proceeds of the policy or contract are payable to or for the benefit of the taxpayer or a person connected with the taxpayer by blood relationship, marriage or adoption; and

(c)  expenses of properties maintained by a succession or trust for the benefit of the taxpayer as one of the beneficiaries;

"personal services business" means a services business carried on by a corporation in a taxation year where an employee who provides services on behalf of the corporation, referred to in this definition and in section 135.2 as an "incorporated employee", or a person related to an incorporated employee is a specified shareholder of the corporation and the incorporated employee could reasonably be regarded as an employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless

(a)  the corporation employs in the business throughout the year more than five full-time employees; or

(b)  the amount received or receivable by the corporation in the year for the services provided is paid or payable by a corporation with which it was associated during that year;

"personal trust" has the meaning assigned by section 649.1;

"personal-use property" has the meaning assigned by section 287;

"post-1971 spousal trust" has the meaning assigned by section 652.1;

"precious property" means a property contemplated in section 265;

"preferred share" means a share other than a common share;

"prescribed class" means a class prescribed under subparagraph e of the first paragraph of section 1086;

"principal amount" in relation to any obligation means the amount that, under the terms of the obligation or any agreement relating thereto, is the maximum amount or maximum aggregate amount, as the case may be, payable on account of the obligation by the issuer thereof, otherwise than as or on account of interest or as or on account of any premium payable by the issuer conditional upon the exercise by the issuer of a right to redeem the obligation before the maturity thereof;

"private corporation" has the meaning assigned by paragraph n of section 570;

"private foundation" has the meaning assigned by paragraph e of section 985.1;

"private health services plan" means a contract of insurance in respect of medical expenses, hospital expenses or any combination of such expenses, or a medical care insurance plan or hospital care insurance plan or both a medical care and hospital care insurance plan, to the extent that the contract or plan essentially applies to expenses described in section 752.0.11.1 and that all or substantially all of the premium or any other consideration payable for coverage provided under the contract or plan is attributable to such expenses, except any such contract or plan established by or pursuant to a law of a province that establishes a health care insurance plan that is a health care insurance plan within the meaning of section 2 of the Canada Health Act (Revised Statutes of Canada, 1985, chapter C-6);

"professional corporation" means a corporation that carries on the professional practice of an accountant, dentist, advocate, physician, veterinarian or chiropractor;

"profit sharing plan" has the meaning assigned by section 852, except for the purposes of Title III.1 of Book V;

"property" means property of any kind whatever whether real or personal, corporeal or incorporeal, and also includes a share, a right of any kind whatever and the work in progress of a business that is a profession;

"property of the bankrupt" has the meaning assigned by the Bankruptcy and Insolvency Act;

"province" means a province of Canada and includes the Northwest Territories, the Yukon Territory and Nunavut;

"public compensation plan" means a plan established under a law of Québec or of another jurisdiction that provides for the payment of benefits following an accident, employment injury, bodily injury or death or in order to prevent bodily injury, other than the Act respecting the Québec Pension Plan (chapter R-9), the Canada Pension Plan (Revised Statutes of Canada, 1985, chapter C-8) or any other law establishing a plan equivalent to that established under the Act respecting the Québec Pension Plan;

"public corporation" has the meaning assigned by paragraph o of section 570;

"public foundation" has the meaning assigned by paragraph f of section 985.1;

"qualified business", in respect of any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;

"qualified donee" has the meaning assigned by paragraph b of section 985.1;

"Québec museum" means a museum situated in Québec and any other museum that is an accredited museum at the time the gift is made.

"Québec sales tax" means the tax payable under Title I of the Act respecting the Québec sales tax (chapter T-0.1);

"recognized arts organization" means an arts organization that is recognized by the Minister on the recommendation of the Minister of Culture and Communications and whose recognition is in effect, but does not include a registered charity;

"recognized gift with reserve of usufruct or use" by a taxpayer in relation to a work of art or a cultural property described in the third paragraph of section 232, means the gift by the taxpayer of the work of art or the cultural property, other than immovable property, that meets the following conditions:

(a)  the gift is a gift inter vivos whereby the taxpayer disposes of the bare ownership of the work of art or the cultural property but retains the usufruct or right of use;

(b)  in the case of a work of art, other than cultural property described in the third paragraph of section 232, the gift is made to a Québec museum;

(c)  in the case of cultural property described in the third paragraph of section 232, the gift is made to an institution or a public authority in Canada which is, at the time of the gift, designated under subsection 2 of section 32 of the Cultural Property Export and Import Act (Revised Statutes of Canada, 1985, chapter C-51) for general purposes or for a specified purpose related to that cultural property, to a certified archival centre or an accredited museum;

(d)  the usufruct or right of use is established only for the taxpayer and is not successive;

(e)  the usufruct or right of use is established for the lifetime of the taxpayer, where the taxpayer is an individual, or for a term not exceeding thirty years;

(f)  the taxpayer was the sole owner of the work of art or the cultural property immediately before the gift was made; and

(g)  the deed of gift provides that

i.  the taxpayer may not dispose of the taxpayer’s usufruct or right of use without the consent of the bare owner,

ii.  the taxpayer shall keep the work of art or the cultural property in a place designated in the deed of gift and shall move it only with the consent of the bare owner and under the terms and conditions determined by the bare owner,

iii.  the taxpayer shall keep the work of art or the cultural property insured against ordinary risks for the duration of the usufruct or right of use and undertake to inform the bare owner without delay of the deterioration or disappearance of the work of art or the cultural property,

iv.  the bare owner may, where the work of art or the cultural property deteriorates,

(1)  decide to restore it, in which case the bare owner shall designate the person for that purpose, who will be remunerated out of the proceeds of the insurance referred to in subparagraph iii, or

(2)  decide not to restore it, in which case the bare owner may claim from the taxpayer the proceeds of the insurance referred to in subparagraph iii that the taxpayer will be required to give to the bare owner within ten days of the receipt of the written confirmation of the decision, and

v.  the usufruct or right of use is extinguished where the work of art or the cultural property disappears and the taxpayer may claim the proceeds of the insurance referred to in subparagraph iii;

"recognized political education organization" has the meaning assigned by section 985.36;

"registered Canadian amateur athletic association" has the meaning assigned by section 21.41;

"registered charity" at any time means a charitable organization within the meaning of section 985.1, a private foundation or a public foundation, that is at that time registered with the Minister as a charitable organization within the meaning of that section 985.1, a private foundation or a public foundation, or that is deemed to be so registered in accordance with sections 985.5 to 985.5.2;

"registered education savings plan" has the meaning assigned by Title III of Book VII;

"registered national arts service organization", at any time, means a national arts service organization that is deemed to be registered at that time by the Minister under section 985.24 and whose registration is in force;

"registered pension plan" means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

"registered Québec amateur athletic association" has the meaning assigned by section 21.42;

"registered retirement income fund" means a fund accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

"registered retirement plan" means an employees’ superannuation plan accepted before 1 January 1986 by the Minister for registration for the purposes of this Part in respect of its constitution and operations for the taxation year under consideration;

"registered retirement savings plan" means a plan accepted as such by the Minister of Revenue of Canada for the purposes of the Income Tax Act and the registration of which is in force;

"registered securities dealer" means a person authorized to trade in securities, in the capacity of an agent or principal, without any restriction as to the types or kinds of securities in which that person may trade by reason of the fact that the person

(a)  is registered or licensed under the laws of a province; or

(b)  meets the following conditions:

i.  the person is registered with, or licensed by, a competent authority other than the competent authority of a province, and

ii.  the person obtained from the Autorité des marchés financiers or from a securities commission or similar body an exemption from registration pursuant to the laws of a province;

"registered supplementary unemployment benefit plan" has the meaning assigned by subsection 3 of section 962;

"regulation" means a regulation made by the Government under this Part;

"restricted farm loss" has the meaning assigned by section 207;

"restricted financial institution" means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of "financial institution" in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations described in any of paragraphs a to e.1;

"retirement compensation arrangement" has the meaning assigned by section 890.1;

"retirement income fund" has the meaning assigned by subsection 1 of section 146.3 of the Income Tax Act;

"retirement savings plan" has the meaning assigned by subsection 1 of section 146 of the Income Tax Act;

"retiring allowance" means an amount, other than an amount received as a consequence of the death of an employee, a pension benefit or a benefit referred to in the third paragraph of section 38 in respect of counselling services described therein, received by a taxpayer or, after the taxpayer’s death, by a dependent or a relative of the taxpayer or by the legal representative of the taxpayer

(a)  on or after retirement of the taxpayer from an office or employment in recognition of the taxpayer’s long service; or

(b)  in respect of the loss of an office or employment of the taxpayer, whether or not received as, on account of or in lieu of damages or pursuant to an order or judgment of a competent tribunal;

"salary deferral arrangement" in respect of an individual has the meaning assigned by sections 47.15 and 47.16;

"salary or wages", except in section 32 and in paragraph a of the definition of "earned income" set out in section 1029.8.67, means the income of a taxpayer from an office or employment as computed under Title II of Book III and includes all fees received by the taxpayer for services not rendered in the course of the taxpayer’s business, but does not include pension benefits or retiring allowances;

"savings and credit union" has the meaning assigned by section 797;

"scientific research and experimental development" has the meaning assigned by subsections 2 to 4 of section 222;

"self-contained domestic establishment" means a dwelling-house, apartment or other similar place of residence in which a person as a general rule sleeps and eats;

"servant" means a person engaged in employment;

"share" means a share or fraction of a share of the capital stock of a corporation and includes, except for the purposes of Title VI.1 of Book VII, a share or fraction of a share of the capital of a prescribed cooperative or of a savings and credit union;

"shareholder" includes any person entitled to receive payment of a dividend;

"short-term preferred share" has the meaning assigned by sections 21.11.11 to 21.11.13;

"sister" of a taxpayer includes the sister of the taxpayer’s spouse and the spouse of the taxpayer’s brother;

"small business bond" has the meaning assigned by section 119.15;

"small business corporation", at any particular time, means, subject to section 726.6.2 and on the assumption, for the purposes of this definition, that the fair market value of a net income stabilization account or of a farm income stabilization account is deemed to be nil, a Canadian-controlled private corporation all or substantially all of the fair market value of the assets of which is attributable to assets that are, at that time,

(a)  used principally in a qualified business carried on primarily in Canada by the corporation or by a corporation related to it;

(b)  shares of the capital stock of a small business corporation connected with the corporation within the meaning of the regulations;

(c)  indebtedness of a corporation described in paragraph b, or

(d)  assets described in subparagraphs a to c;

"specified employee" of a person means an employee of the person who is a specified shareholder of the person or who does not deal at arm’s length with the person;

"specified financial institution", at a particular time, means

(a)  a bank;

(b)  a corporation licensed or otherwise authorized under the laws of Canada or a province to carry on in Canada the business of offering its services as trustee;

(c)  a savings and credit union;

(d)  an insurance corporation;

(e)  a corporation whose principal business is the lending of money to persons with whom it is dealing at arm’s length or the purchasing of debt obligations issued by such persons, or a combination thereof;

(e.1)  a corporation referred to in paragraph g of the definition of "financial institution" in subsection 1 of section 181 of the Income Tax Act;

(f)  a corporation that is controlled by one or more corporations referred to in any of paragraphs a to e.1 and, for the purposes of this paragraph, one corporation is controlled by another corporation if more than 50% of its issued share capital having full voting rights under all circumstances belongs to the other corporation, to persons with whom the other corporation does not deal at arm’s length, or to the other corporation and persons with whom the other corporation does not deal at arm’s length;

(g)  a corporation that is related to a particular corporation referred to in any of paragraphs a to f, other than a particular corporation referred to in paragraph e or e.1 the principal business of which is the factoring of trade accounts receivable that the particular corporation acquired from a related person, that arose in the course of an eligible business carried on by a person, in this paragraph referred to as the "business entity", related at that time to the particular corporation, and that at no particular time before that time were held by a person other than a person who was related to the business entity and, for the purposes of this paragraph, where in the case of two or more corporations it may reasonably be considered, having regard to all the circumstances, that one of the main reasons for the separate existence of those corporations in a taxation year is to limit or avoid the application of any of sections 740.1, 740.2 to 740.3.1 and 845, those corporations are deemed to be related to each other and to each other corporation to which any such corporation is related;

"specified individual" has the meaning assigned by section 766.5;

"specified investment business" has the meaning assigned by section 771.1;

"specified member" of a partnership in a fiscal period or taxation year of the partnership, as the case may be, means

(a)  any member of the partnership who is a limited partner, within the meaning assigned by section 613.6, of the partnership at any time in the fiscal period or taxation year;

(b)  any member of the partnership, other than a member who is actively engaged in those activities of the partnership business that are other than the financing of the partnership business, or is carrying on a business similar to that carried on by the partnership in its taxation year, otherwise than as a member of a partnership, on a regular, continuous and substantial basis throughout that part of the fiscal period or taxation year during which the business of the partnership is ordinarily carried on and during which the member is a member of the partnership;

"specified shareholder" has the meaning assigned by sections 21.17 and 21.18;

"specified tax consequence" for a taxation year means

(a)  the consequence of the exclusion from the income or the deduction of an amount referred to in the first paragraph of section 1044;

(b)  the consequence of a reduction under section 359.15 of an amount purported to be renounced by a corporation after the beginning of the year to a person or partnership under section 359.2 or 359.2.1 because of the application of section 359.8, determined as if the purported renunciation would, but for section 359.15, have been effective only where the requirements in paragraphs b and c of section 359.8 and the following requirements had been satisfied:

i.  the purported renunciation occurred in the first three months of a particular calendar year,

ii.  the effective date of the purported renunciation was the last date of the calendar year preceding the particular calendar year,

iii.  the corporation agreed in the calendar year preceding the particular calendar year to issue a flow-through share to a person or partnership;

iv.  the amount does not exceed the amount by which the consideration for which the share was issued exceeds the aggregate of all other amounts purported by the corporation to have been renounced under section 359.2 or 359.2.1 in respect of that consideration, and

v.  the form prescribed for the purpose of section 359.12 in respect of the purported renunciation is filed by the corporation with the Minister before 1 May of the particular calendar year;

(c)  the consequence of an adjustment or a reduction described in section 1042.1;

"split income" has the meaning assigned by section 766.5;

"stock dividend" includes any dividend, determined without reference to the definition of "dividend" in this section, paid by a corporation to the extent that it is paid by the issuance of shares of any class of the capital stock of the corporation;

"subsidiary controlled corporation" means a corporation more than 50% of the issued capital stock of which having full voting rights under all circumstances belongs to the corporation to which it is subsidiary;

"subsidiary wholly-owned corporation" means a corporation all the issued capital stock of which except directors’ qualifying shares, belongs to the corporation to which it is subsidiary;

"succession" has the meaning assigned by section 646;

"supplementary unemployment benefit plan" has the meaning assigned by subsection 1 of section 962;

"tar sands" means a mineral extracted, otherwise than by a well, from a mineral resource that is a deposit of bituminous sands or oil shales and, for the purpose of applying sections 93 to 104 and 130 and any regulations made under paragraph a of section 130 in respect of property acquired after 6 March 1996, includes material extracted by a well from a deposit of bituminous sands or oil shales;

"tax agreement" with a country other than Canada at any time means an agreement for the elimination of double taxation on income, between the Government of Québec and the government of the country, which has the force of law in Québec at that time or, in the absence of such an agreement, a comprehensive agreement or convention for the elimination of double taxation on income, between the Government of Canada and the government of the country, which has the force of law in Canada at that time;

"tax-agreement-protected business" of a taxpayer at any time means a business in respect of which any income of the taxpayer for a period that includes that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

"tax-agreement-protected property" of a taxpayer at any time means property any income or gain from the disposition of which by the taxpayer at that time would, because of a tax agreement with a country other than Canada, be exempt from tax under this Part;

"tax shelter" has the meaning assigned by section 1079.1;

"taxable Canadian corporation" has the meaning assigned by paragraph m of section 570;

"taxable Canadian property" has the meaning assigned by Part II and, for the purposes of section 688.0.0.1, Chapter I of Title I.1 of Book VI and sections 1000 to 1003, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Canadian resource property;

(b)  a timber resource property;

(c)  an income interest in a trust resident in Canada;

(d)  a right to a share of the income or loss of a partnership under an agreement referred to in section 608; and

(e)  a life insurance policy in Canada;

"taxable capital gain" has the meaning assigned by section 231;

"taxable dividend" has the meaning assigned by paragraph g of section 570;

"taxable income" has the meaning assigned by section 24 or 26.1, as the case may be, and in no case may the taxpayer’s taxable income be less than $0;

"taxable net gain" from the disposition of precious property has the meaning assigned by section 265;

"taxable preferred share" has the meaning assigned by sections 21.11.14 to 21.11.16;

"taxable Québec property" has the meaning assigned by Part II and, for the purposes of sections 26 and 27, and for the purpose of applying section 521 and subparagraph c of the second paragraph of section 614 in respect of a disposition made by a person not resident in Canada, includes

(a)  a Québec resource property within the meaning of paragraph d of section 1089,

(b)  a timber resource property situated in Québec, including at any particular time an interest therein and an option in respect thereof,

(c)  an income interest in a trust resident in Québec,

(d)  a right to a share in the income or loss of a partnership having an establishment in Québec under an agreement described in section 608, and

(e)  a life insurance policy issued or subscribed by an insurer on the life of a person resident in Québec at the time of the issue or subscription;

"taxation year" means, in the case of a corporation, a fiscal period and, in the case of an individual, a calendar year;

"taxpayer" includes any person whether or not liable to pay tax;

"term preferred share" has the meaning assigned by sections 21.5 to 21.9.5;

"testamentary trust" has the meaning assigned by section 677;

"timber resource property" has the meaning assigned by subparagraph d of the first paragraph of section 93;

"Treasury Board" means the Conseil du trésor continued under the Public Administration Act (chapter A-6.01);

"trust" has the meaning assigned by section 646;

"uncle" of a taxpayer includes the spouse of the taxpayer’s aunt;

"undepreciated capital cost" of depreciable property of a prescribed class of a taxpayer has the meaning assigned by section 93;

"undepreciable property" means any property other than depreciable property;

"unit trust" has the meaning assigned by section 649;

"written separation agreement" includes an agreement by which a person agrees to make payments on a periodic basis for the maintenance of a former spouse, child or both, after the marriage has been dissolved whether the agreement was made before or after the marriage was dissolved.

1972, c. 23, s. 1; 1972, c. 26, s. 31; 1973, c. 17, s. 1; 1973, c. 18, s. 1; 1975, c. 21, s. 1; 1975, c. 22, s. 1; 1977, c. 5, s. 14; 1977, c. 26, s. 1; 1978, c. 26, s. 1; 1979, c. 18, s. 1; 1979, c. 38, s. 1; 1979, c. 81, s. 20; 1980, c. 13, s. 1; 1982, c. 5, s. 1; 1982, c. 17, s. 47; 1982, c. 56, s. 8; 1983, c. 44, s. 13; 1984, c. 15, s. 1; 1985, c. 25, s. 17; 1986, c. 15, s. 31; 1986, c. 19, s. 1; 1987, c. 21, s. 7; 1987, c. 67, s. 4; 1988, c. 4, s. 17; 1988, c. 18, s. 2; 1989, c. 5, s. 20; 1989, c. 77, s. 2; 1990, c. 59, s. 3; 1991, c. 7, s. 13; 1991, c. 25, s. 2; 1992, c. 1, s. 6; 1993, c. 16, s. 1; 1993, c. 19, s. 12; 1993, c. 64, s. 4; 1994, c. 13, s. 15; 1994, c. 22, s. 41; 1995, c. 1, s. 11; 1995, c. 49, s. 1; 1995, c. 63, s. 12; 1996, c. 39, s. 8; 1997, c. 3, s. 13; 1997, c. 14, s. 10; 1997, c. 31, s. 2; 1997, c. 85, s. 32; 1998, c. 16, s. 4; 1999, c. 83, s. 26; 1999, c. 86, s. 75; 1999, c. 89, s. 53; O.C. 149-2000; 2000, c. 5, s. 4; 2000, c. 8, s. 152; O.C. 1027-2000; 2000, c. 56, s. 218(12); 2001, c. 7, s. 1; 2001, c. 51, s. 17; 2001, c. 53, s. 1; 2002, c. 45, s. 517; O.C. 45-2004; 2003, c. 2, s. 2; 2003, c. 8, s. 6; 2003, c. 9, s. 10; 2004, c. 8, s. 4; 2004, c. 21, s. 37; [(*): since January 31, 2006, a reference to the Minister of Culture and Communications concerning the national archives of Québec is a reference to Bibliothèque et Archives nationales du Québec: 2004, c. 25, s. 70 and O.C. 1295-2005;]; 2004, c. 37, s. 90; 2005, c. 1, s. 20; 2005, c. 23, s. 30; 2005, c. 38, s. 44.