I-3 - Taxation Act

Section 935.38 Disposition versions

2023-09-26

935.38. The rules set out in the second paragraph apply where an amount is transferred at a particular time from a first home savings account (in this section referred to as the “transferor account”) and the following conditions are met:

(a)  the amount is transferred for the benefit of an individual who

i.  is the holder of the transferor account,

ii.  is a spouse or former spouse of the holder of the transferor account, where the transfer is made under a decree, order or judgment of a competent tribunal, or under a written agreement, relating to a partition of property between the holder and the individual in settlement of rights arising out of, or on the breakdown of, their marriage, or

iii.  is entitled to the amount as a consequence of the death of the holder of the transferor account if the individual was the spouse of the holder of the transferor account immediately before the death;

(b)  the amount is transferred directly to another first home savings account of the individual or a registered retirement savings plan or a registered retirement income fund under which the individual is the annuitant; and

(c)  where the transfer is not made to another first home savings account of the holder of the transferor account, the amount does not exceed the amount by which the total fair market value, immediately before the particular time, of all property held as part of a first home savings account under which the holder of the transferor account is a holder exceeds the excess FHSA amount, within the meaning assigned by subsection 1 of section 207.01 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), of the holder of the transferor account at the particular time.

The rules to which the first paragraph refers are as follows:

(a)  the amount transferred in accordance with the first paragraph must not, by reason only of such transfer, be included in computing the income of any taxpayer; and

(b)  no deduction may be made in computing the income of any taxpayer in respect of the amount so transferred.

2023, c. 19, s. 98.