C-8 1 44 70-71 Elizabeth II 2021-2022

An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures

Economic and Fiscal Update Implementation Act, 2021

Economic and Fiscal Update Implementation Act, 2021 2022 6 9 5 2022 91065

RECOMMENDATION

Her Excellency the Governor General recommends to the House of Commons the appropriation of public revenue under the circumstances, in the manner and for the purposes set out in a measure entitled “

An Act to implement certain provisions of the economic and fiscal update tabled in Parliament on December 14, 2021 and other measures ”.

SUMMARY

Part 1 amends the Income Tax Act and the Income Tax Regulations in order to

(

a) introduce a new refundable tax credit for eligible businesses on qualifying ventilation expenses made to improve air quality;

(

b) expand the travel component of the northern residents deduction by giving all northern residents the option to claim up to $1,200 in eligible travel expenses even if the individual has not received travel assistance from their employer;

(

c) expand the School Supplies Tax Credit from 15% to 25% and expand the eligibility criteria to include electronic devices used by eligible educators; and

(

d) introduce a new refundable tax credit to return fuel charge proceeds to farming businesses in backstop jurisdictions.

Part 2 enacts the Underused Housing Tax Act . This Act implements an annual tax of 1% on the value of vacant or underused residential property directly or indirectly owned by non-resident non-Canadians. It sets out rules for the purpose of establishing owners’ liability for the tax. It also sets out applicable reporting and filing requirements. Finally, to promote compliance with its provisions, this Act includes modern administration and enforcement provisions aligned with those found in other taxation statutes.

Part 3 provides for a six-year limitation or prescription period for the recovery of amounts owing with respect to a loan provided under the Canada Emergency Business Account program established by Export Development Canada.

Part 4 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of supporting ventilation improvement projects in schools.

Part 5 authorizes payments to be made out of the Consolidated Revenue Fund for the purpose of supporting coronavirus disease 2019 (COVID-19) proof-of-vaccination initiatives.

Part 6 authorizes the Minister of Health to make payments of up to $1.72 billion out of the Consolidated Revenue Fund in relation to coronavirus disease 2019 (COVID-19) tests. It also sets out reporting requirements for the Minister of Health.

Part 7 amends the Employment Insurance Act to specify the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers.

Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Short Title

Short title

This Act may be cited as the Economic and Fiscal Update Implementation Act, 2021 .

PART 1

R.S., c. 1 (5th Supp.)

Income Tax Act

Amendments to the Act

(1) Subsection 87(2) of the Income Tax Act is amended by adding the following after paragraph (g.7):

COVID-19 — air quality improvement tax credit

(g.8)

for the purposes of

section 127.43, the new corporation is deemed to be the same corporation as, and a continuation of, each predecessor corporation;

(2) Subsection (1) is deemed to have come into force on September 1, 2021.

(1) Paragraph 110.7(1)(

a) of the Act is replaced by the following:

(

a) the total of all amounts each of which is the amount, in respect of a particular period during the taxation year, determined by the formula

A × B where A

is the specified percentage for the particular area in which the taxpayer resided during the particular period, and

is the total trip costs to the taxpayer in respect of trips that begin during the particular period; and

(2) Subsection 110.7(3) of the Act is replaced by the following:

Restriction

(3) The total of all amounts determined under paragraph (1)(

a) for all taxpayers in a taxation year in respect of an individual shall not be in respect of more than two trips made by the individual that begin in the year (other than trips to obtain medical services that are not available in the locality in which the taxpayer resided).

Additional restrictions

(3.1) For the purpose of paragraph (1)(a), an amount may only be included in the amount determined for B for a particular area for a taxation year if

(

a) the amount is not otherwise deducted in computing the income for any taxation year of any individual (except by an employer under

section 9 if it is included in an employee’s income);

(

b) the amount is not included in determining an amount deducted under subsection 118.2(1) for any taxation year;

(

c) the amount is in respect of trips made by the taxpayer or an eligible family member of the taxpayer that begin during the part of the year in which the taxpayer resided in the particular area; and

(

d) neither the taxpayer nor an eligible family member of the taxpayer is at any time entitled to a reimbursement or any form of assistance (other than a reimbursement or assistance included in computing the income of the taxpayer or the eligible family member) in respect of trips to which paragraph (

c) applies.

Additional restriction

(3.2) If all amounts determined under paragraph 7304(2)(

a) of the Income Tax Regulations are nil in respect of trips (beginning in the taxation year) made by an individual, the total of all amounts determined for B in paragraph (1)(

a) in the taxation year for all taxpayers in respect of the individual must not exceed the standard amount for the individual for the taxation year.

Deemed standard amount

(3.3) If an employer-provided travel benefit was claimed by a taxpayer in respect of an individual in respect of the taxation year, the standard amount for the individual is deemed to be nil for the taxation year.

(3) Section 110.7 of the Act is amended by adding the following after subsection (5):

Definitions

(6) The following

definitions apply in this section.

eligible family member of a taxpayer, at any time, means a member of the taxpayer’s household who is at that time

(

a) the taxpayer’s spouse or common-law partner;

(

b) a child of the taxpayer (including a child of the taxpayer’s spouse or common-law partner) under the age of 18; or

(

c) another individual who is

(

i) related to the taxpayer,

(ii)

wholly dependent for support on the taxpayer, the taxpayer’s spouse or common-law partner, or both of them, and

(iii)

except in the case of a parent or grandparent of the taxpayer, so dependent by reason of mental or physical infirmity. ( membre de la famille admissible )

employer-provided travel benefits , to a taxpayer in respect of a trip made by the taxpayer or their eligible family member, means the total amount of

(

a) the value of travel assistance, if any, provided to the taxpayer in respect of the taxpayer’s employment in respect of travel expenses for the trip; and

(

b) the amount, if any, received by the taxpayer in respect of the taxpayer’s employment in respect of travel expenses for the trip. ( avantages relatifs aux voyages tirés de l’emploi )

standard amount , for an individual for a taxation year and subject to subsection (3.3), means $1,200. ( montant forfaitaire )

trip cost has the meaning prescribed by regulation. ( frais de voyage )

(4) Subsections (1) to (3) apply to the 2021 and subsequent taxation years.

(1) Subparagraph (a)(ii) of the definition eligible supplies expense in subsection 122.9(1) of the Act is replaced by the following:

(ii)

directly consumed or used in the performance of the duties of the eligible educator’s employment; and

(2) Subsection 122.9(2) of the Act is replaced by the following:

Deemed overpayment

(2) An eligible educator who files a return of income for a taxation year and who makes a claim under this subsection is deemed to have paid, at the end of the year, on account of tax payable under this Part for the year, an amount equal to 25% of the least of

(a)

$1,000;

(

b) the total of all amounts each of which is an eligible supplies expense of the eligible educator for the year; and

(

c) if the eligible educator fails to provide the certificate referred to in subsection (3) in respect of the year, as and when requested by the Minister, nil.

(3) Subsections (1) and (2) apply to the 2021 and subsequent taxation years.

(1) The Act is amended by adding the following after

section 127.41:

Definitions

127.42

(1) The following

definitions apply in this section.

designated province means a province specified by the Minister of Finance for a calendar year. ( province déterminé

e) eligible farming expenses , of a taxpayer for a designated province for a taxation year, means the amount determined by the formula

A × B where A

(

a) nil, if the total of all amounts deducted in the year by the taxpayer in computing income under this Part from farming activities, excluding any deductions arising from inventory adjustments under

section 28 and from transactions with persons that do not deal at arm’s length with the taxpayer, is less than $25,000, and

(

b) in any other case, the total of all amounts deducted in the year by the taxpayer in computing income under this Part from farming activities, excluding any deductions arising from inventory adjustments under

section 28 and from transactions with persons that do not deal at arm’s length with the taxpayer; and

is the taxpayer’s relevant proportion for the designated province for the taxation year. ( dépenses agricoles admissibles )

farming activities means a farming business, including or excluding activities prescribed by regulation. ( activités agricoles )

payment rate , for a calendar year for a designated province, means the rate specified by the Minister of Finance for the calendar year for the designated province. ( taux de paiement )

relevant proportion , of eligible farming expenses of a taxpayer for a designated province for a taxation year, means

(

a) if the taxpayer is an individual, the proportion determined by the formula

A ÷ B where A

is the individual’s income for the year from farming activities that is deemed to have been earned in the year in the designated province in accordance with

Part XXVI of the Income Tax Regulations , and

is the whole of the individual’s income from farming activities for the year;

(

b) if the taxpayer is a corporation, the proportion determined by the formula

C ÷ D where C

is the corporation’s taxable income that is deemed to have been earned in the year in the designated province in accordance with

Part IV of the Income Tax Regulations , and

is the whole of the corporation’s taxable income for the year; and

(

c) if the taxpayer is a partnership, the proportion determined by the formula

E ÷ F where E

is the partnership’s income for the fiscal period of the partnership from farming activities that would be deemed to have been earned in the year in the designated province, computed in accordance with

Part XXVI of the Income Tax Regulations as if the partnership were an individual, and

is the whole of the partnership’s income from farming activities for the fiscal period of the partnership. ( proportion pertinente )

Deemed payment on account of tax

(2) A taxpayer (other than a partnership) that files a prescribed form containing prescribed information with their return of income for a taxation year is deemed, on their balance-due day for the year, to have paid on account of their tax payable under this Part for the year, the total of all amounts each of which is an amount, for each designated province and for each calendar year a portion of which falls within the taxation year, determined by the formula

(A × B) × (C ÷

D) where A

is the payment rate for the calendar year for the designated province;

is the taxpayer’s eligible farming expenses for the designated province for the taxation year;

is the number of days within the taxation year that fall within the calendar year; and

is the number of days in the taxation year.

Deemed payment on account of tax — partnership

(3) If a taxpayer (other than a partnership) is a member of a partnership at the end of a fiscal period of the partnership that ends in a taxation year of the taxpayer — and the partnership files a prescribed form containing prescribed information for that fiscal period and the taxpayer files a prescribed form containing prescribed information with its return of income for the taxation year — the taxpayer is deemed, on the taxpayer’s balance-due day for the taxation year, to have paid on account of their tax payable under this Part for the year, the total of all amounts each of which is an amount, for each designated province and for each calendar year a portion of which falls within the partnership’s fiscal period, determined by the formula

(A × B) × (C ÷ D) × E where A

is the payment rate for the calendar year for the designated province;

is the partnership’s eligible farming expenses for the designated province for the fiscal period;

is the number of days within the fiscal period that fall within the calendar year;

is the number of days in the fiscal period; and

is the specified proportion of the taxpayer for the fiscal period.

Partnerships

(4) For the purposes of this section,

(

a) a taxpayer includes a partnership;

(

b) the fiscal period of a partnership is deemed to be its taxation year; and

(

c) if a taxpayer is a member of a particular partnership that is a member of another partnership, the taxpayer is deemed

(

i) to be a member of the other partnership, and

(ii)

to have a specified proportion in the other partnership for a fiscal period of the other partnership equal to its specified proportion of the particular partnership — for the last fiscal period of the particular partnership that ends in the fiscal period of the other partnership — multiplied by the particular partnership’s specified proportion of the other partnership for the fiscal period of the other partnership.

Authority to specify

(5) For the purposes of this section, the Minister of Finance may specify for a calendar year

(

a) the designated provinces; and

(

b) the payment rate for a designated province.

Payment rate not specified

(6) For the purposes of this section, if the Minister of Finance does not specify the payment rate for a designated province under paragraph (5)(b), the payment rate is deemed to be nil.

When assistance received

(7) For the purposes of this Act, and for greater certainty, an amount that a taxpayer is deemed under subsection (2) or (3) to have paid for a taxation year is assistance received by the taxpayer from a government immediately before the end of the year.

Relevant proportion — special rule

(8) For purposes of determining the relevant proportion of eligible farming expenses of a taxpayer for a designated province in a taxation year,

(

a) if the income of an individual or partnership from farming activities for the year is nil, the income for the year from farming activities that is deemed to have been earned in the year in the designated province shall be computed in accordance with

Part XXVI of the Income Tax Regulations as if the individual or partnership earned $1,000,000 of income from farming activities; and

(

b) if the taxable income of a corporation is nil, the corporation’s taxable income that is deemed to have been earned in the year in the designated province shall be computed in accordance with

Part IV of the Income Tax Regulations as if the corporation had taxable income for the year in the amount of $1,000,000.

(2) Subsection (1) applies to the 2021 and subsequent taxation years.

(1) The Act is amended by adding the following after

section 127.42:

COVID-19 – Air Quality Improvement Tax Credit

Definitions

127.43

(1) The following

definitions apply in this section.

assistance means an amount, other than a prescribed amount or an amount deemed under subsection (2) to have been paid, that would be included under paragraph 12(1)(

x) in computing an eligible entity’s income for any taxation year if that paragraph were read without reference to subparagraphs 12(1)(x)(

v) to (vii). ( montant d’aide )

eligible entity , for a taxation year, means

(

a) a qualifying corporation for the taxation year;

(

b) an individual other than a trust; or

(

c) a partnership. ( entité déterminé

e) qualifying corporation , for a particular taxation year, means a particular corporation that meets the following conditions:

(

a) it is a Canadian-controlled private corporation or would be a Canadian-controlled private corporation absent the application of subsection 136(1); and

(

b) it is the case that

$15,000,000 > A + B where A

is the particular corporation’s taxable capital employed in Canada (in this formula, within the meaning assigned by

section 181.2 or 181.3) for its immediately preceding taxation year, and

is the total of all amounts, each of which is the taxable capital employed in Canada of a corporation that is associated in the particular taxation year with the particular corporation for the associated corporation’s last taxation year that ended before the beginning of the particular taxation year. ( société admissible )

qualifying expenditure means an outlay or expense prescribed by regulation that is made or incurred by an eligible entity during the qualifying period in the course of the eligible entity’s ordinary commercial activities. ( dépense admissible )

qualifying location , of an eligible entity, means real or immovable property (other than property that is a self-contained domestic establishment, or part of such a self-contained domestic establishment, the land subjacent to the self-contained domestic establishment and such portion of any immediately contiguous land as can reasonably be regarded as contributing to the use and enjoyment of the self-contained domestic establishment as a residence) in Canada used by the eligible entity primarily in the course of its ordinary commercial activities. ( emplacement admissible )

qualifying period means the period that begins on September 1, 2021 and ends on December 31, 2022. ( période d’admissibilité )

total per location expense , for a qualifying location of an eligible entity for a taxation year, means the lesser of

(

a) the amount determined by the formula

A − B where A

is the total of all amounts, each of which is a qualifying expenditure of the eligible entity made or incurred in the taxation year in respect of the qualifying location (or, for the first taxation year that ends after 2021, the qualifying expenditures made or incurred in respect of the qualifying location from the start of the qualifying period to the end of that first taxation year), and

is the total of all amounts, each of which is an amount of assistance that

(

i) the eligible entity has received, is entitled to receive or can reasonably be expected to receive, in respect of amounts described in A, and

(ii)

has not been repaid before the end of the taxation year pursuant to a legal obligation to do so; and

(

b) the amount determined by the formula

$10,000 − C where C

is the total of all amounts, each of which is a qualifying expenditure in respect of the qualifying location and

(

i) is a qualifying expenditure of the eligible entity, in respect of which an amount under subsection (2) or (3) is deemed to have been paid in a prior taxation year, or

(ii)

is a qualifying expenditure of another eligible entity that is affiliated during the qualifying period with the eligible entity, in respect of which an amount under subsection (2) or (3) is deemed to have been paid in any taxation year. ( dépense totale par emplacement )

total ventilation expense , of an eligible entity for a taxation year, means the lesser of

(

a) the total of all amounts, each of which is a total per location expense for a qualifying location of the eligible entity for the taxation year; and

(

b) the amount determined by the formula

$50,000 × X − Y where X

(i)

100%, unless the eligible entity is affiliated at any time in the qualifying period with one or more other eligible entities that are deemed to have paid an amount under subsection (2) in respect of the qualifying period, or, in the case of a partnership, has a member that is deemed to have paid an amount under subsection (3) in respect of the partnership,

(ii)

a percentage assigned to the eligible entity under an agreement, if

(

A) the agreement is entered into by the eligible entity and each eligible entity that

(

I) is affiliated with the eligible entity in the qualifying period, and

(II)

is deemed to have paid an amount under subsection (2) in respect of the qualifying period, or, in the case of a partnership, has a member that is deemed to have paid an amount under subsection (3) in respect of the partnership,

(

B) the agreement is filed in prescribed form and manner with the Minister by the eligible entity and each eligible entity referred to in clause (A),

(

C) the agreement assigns, for the purposes of this definition, a percentage in respect of each eligible entity referred to in clause (A), and

(

D) the total of all the percentages assigned under the agreement does not exceed 100%, and

(iii)

in any other case, nil, and

is the total of all amounts, each of which is the total ventilation expense of the eligible entity for a prior taxation year in respect of which an amount is deemed to have been paid under subsection (2) or (3). ( dépense totale de ventilation )

Refundable tax credit

(2) An eligible entity (other than a partnership) that files a prescribed form containing prescribed information with its return of income for a taxation year that ends after 2021 is deemed to have, on its balance-due day for the year, paid on account of its tax payable under this Part for the year an amount equal to 25% of its total ventilation expense for the taxation year.

Refundable tax credit — partnership

(3) If an eligible entity (other than a partnership) is a member of a partnership at the end of a fiscal period of the partnership that ends after 2021 and that ends in a taxation year of the eligible entity — and the partnership files an information return in prescribed form containing prescribed information for that fiscal period and the eligible entity files a prescribed form containing prescribed information with its return of income for the taxation year — then the eligible entity is deemed to have paid, on the eligible entity’s balance-due day for the taxation year on account of the eligible entity’s tax payable under this Part for the taxation year, an amount determined by the formula

0.25 × A × B where A

is the total ventilation expense of the partnership for the fiscal period; and

is the specified proportion of the eligible entity for the fiscal period of the partnership.

Partnerships

(4) For the purposes of this section,

(

a) the fiscal period of a partnership is deemed to be its taxation year; and

(

b) if an eligible entity is a member of a particular partnership that is a member of another partnership, the eligible entity is deemed

(

i) to be a member of the other partnership, and

(ii)

to have a specified proportion in the other partnership for a fiscal period of the other partnership equal to its specified proportion of the particular partnership — for the last fiscal period of the particular partnership that ends in the fiscal period of the other partnership — multiplied by the particular partnership’s specified proportion of the other partnership for the fiscal period of the other partnership.

When assistance received

(5) For the purposes of this Act other than this section, and for greater certainty, an amount that an eligible entity is deemed under subsection (2) or (3) to have paid is assistance received by it from a government immediately before the end of the taxation year to which it relates.

Affiliated entities

(6) For the purposes of this section, if two eligible entities are affiliated with the same eligible entity, they are deemed to be affiliated with each other.

(2) Subsection (1) is deemed to have come into force on September 1, 2021.

C.R.C., c. 945

Related Amendments to the Income Tax Regulations

(1) The portion of subsection 7304(2) of the Income Tax Regulations before paragraph (

c) is replaced by the following:

(2) For the purposes of this

section and

section 110.7 of the Act, the trip cost to a taxpayer in respect of a trip made by an individual who, at the time the trip was made, was a member of the taxpayer’s household is the least of

(

a) the amount of employer-provided travel benefits , as defined in subsection 110.7(6) of the Act, that is claimed by the taxpayer in respect of the trip;

(

b) the total of

(

i) the amount of travel assistance described in paragraph (

a) of the definition employer-provided travel benefits in subsection 110.7(6) of the Act in respect of the trip, and

(ii)

travel expenses incurred by the taxpayer, or the spouse or common-law partner of the taxpayer, for the trip; and

(2) Subsections 7304(3) and (4) of the Regulations are replaced by the following:

(3) In determining the trip cost to the taxpayer in respect of the trip, if the amount determined under paragraph (2)(

a) is nil, subsection (2) is to be read without reference to that paragraph.

(4) For the purposes of subsection (2), the amounts claimed by the taxpayer in paragraph (2)(

a) in respect of a trip are deemed to be nil, unless the taxpayer was dealing at arm’s length with the employer at the time that the employer-provided travel benefits , as defined in subsection 110.7(6) of the Act, were provided to the taxpayer.

(3) Subsections (1) and (2) apply to the 2021 and subsequent taxation years.

(1) Section 9600 of the Regulations is amended by striking out “and” at the end of paragraph (

c) and by adding the following after paragraph (d):

(

e) calculators (including graphing calculators);

(

f) external data storage devices;

(

g) web cams, microphones and headphones;

(

h) multimedia projectors;

(

i) wireless pointer devices;

(

j) electronic educational toys;

(

k) digital timers;

(

l) speakers;

(

m) video streaming devices;

(

n) printers; and

(

o) laptop, desktop and tablet computers, provided that none of these items are made available to the eligible educator by their employer for use outside of the classroom.

(2) Subsection (1) applies to the 2021 and subsequent taxation years.

(1) The Regulations are amended by adding the following after

section 9600:

PART XCVII

COVID-19 — Air Quality Improvement Tax Credit

Tax credit — air quality improvement

(1) The following

definitions apply in this section.

HEPA filter means a high-efficiency particulate air filter that has been tested to ensure efficiency equal to or exceeding 99.97% for removal of airborne particles having a mean aerodynamic diameter of 0.3 µm (micrometres) from the air. ( filtre HEPA )

HVAC system means a mechanical heating, ventilating and air conditioning system that is installed in a building, and includes all of its equipment and components. ( système CVCA )

MERV means the minimum efficiency reporting value parameters specified in ANSI/ASHRAE Standard 52.2-2017, Method of Testing General Ventilation Air-Cleaning Devices for Removal Efficiency by Particle Size,

Section 12, Minimum Efficiency Reporting Value (MERV) for Air Cleaners, Table 12-1, Minimum Efficiency Reporting Value (MERV) Parameters. ( MERV )

(2) Subject to subsection (3), for the purposes of the definition qualifying expenditure in subsection 127.43(1) of the Act, the following outlays and expenses are prescribed to the extent that they are reasonable and intended primarily to increase outdoor air intake or to improve air cleaning:

(

a) outlays and expenses that are directly attributable to the purchase, installation, conversion or upgrade of a new or retrofitted HVAC system placed in service at a qualifying location that meets either of the following conditions:

(

i) the system is designed to filter air at a rate in excess of MERV 8 or an equivalent level of filtration, or

(ii)

the system is designed to filter air at a rate equal to MERV 8 or an equivalent level of filtration and the following conditions are met:

(

A) the system is designed to achieve an outdoor air supply rate in excess of what is required for the space by applicable building codes, and

(

B) in the case of an upgrade or conversion of an existing system, prior to the upgrade or conversion, the system was designed to filter air at a rate equal to MERV 8; and

(

b) outlays and expenses that are directly attributable to the purchase of a device that is placed in service at a qualifying location and designed to filter air using a HEPA filter.

(3) The outlays and expenses in subsection (2) do not include an outlay or expense of an eligible entity

(

a) made or incurred under the terms of an agreement entered into before the start of the qualifying period;

(

b) that is the cost of recurring or routine repair or maintenance;

(

c) that can reasonably be expected to be paid or returned, directly or indirectly, in any manner whatever, to

(

i) the eligible entity,

(ii)

a person or partnership not dealing at arm’s length with the eligible entity, or

(iii)

another person or partnership at the direction of the eligible entity;

(

d) that is paid to a party with which the eligible entity does not deal at arm’s length;

(

e) that is salary or wages paid to an employee of the eligible entity; or

(

f) for financing costs.

(2) Subsection (1) is deemed to have come into force on September 1, 2021.

PART 2

Underused Housing Tax Act

Enactment of Act

Enactment

(1) The Underused Housing Tax Act is enacted as follows:

An Act respecting the taxation of underused housing

Short Title

Short title

This Act may be cited as the Underused Housing Tax Act .

PART 1

Interpretation and General Rules of Application

Definitions

The following

definitions apply in this Act.

assessment means an assessment under this Act and includes a reassessment. ( cotisation )

bank means a bank as defined in

section 2 of the Bank Act or an authorized foreign bank , as defined in that section, that is not subject to the restrictions and requirements referred to in subsection 524(2) of that Act. ( banque )

business number means any number (other than a Social Insurance Number) used by the Minister to identify a person for the purposes of this Act. ( numéro d’entreprise )

citizen has the same meaning as in subsection 2(1) of the Citizenship Act . ( citoyen )

Commissioner means, except in sections 21 , 22 and 83 , the Commissioner of Revenue appointed under

section 25 of the Canada Revenue Agency Act . ( commissaire )

common-law partner of an individual at any time means another individual who is the common-law partner of the individual at that time for the purposes of the Income Tax Act . ( conjoint de fait )

confirmed delivery service means certified or registered mail or any other delivery service that provides a record that a notice or document has been sent or delivered. ( service de messagerie )

credit union means a credit union as defined in subsection 137(6) of the Income Tax Act or a corporation described in paragraph (

a) of the definition deposit insurance corporation in subsection 137.1(5) of that Act. ( caisse de crédit )

disaster means an earthquake, fire, flood, landslide, spill or leakage of oil, gas or another poisonous or dangerous substance or any other natural disaster or dangerous event. ( sinistre )

dwelling unit means a residential unit that contains private kitchen facilities, a private bath and a private living area. ( local d’habitation )

excluded owner of a residential property for a calendar year means a person (other than a prescribed person) that is on December 31 of the calendar year

(

a) Her Majesty in right of Canada or a province or an agent of Her Majesty in right of Canada or a province;

(

b) an individual who is a citizen or permanent resident, except to the extent that the individual is an owner of the residential property in their capacity as a trustee of a trust (other than a personal representative in respect of a deceased individual) or as a partner of a partnership;

(

c) a corporation incorporated under the laws of Canada or a province whose shares are listed on a stock exchange in Canada for which a designation under

section 262 of the Income Tax Act is in effect;

(

d) a person that is an owner of the residential property in their capacity as a trustee of

(

i) a mutual fund trust as defined in subsection 248(1) of the Income Tax Act ,

(ii)

a real estate investment trust as defined in subsection 122.1(1) of that Act, or

(iii)

a SIFT trust as defined in subsection 122.1(1) of that Act;

(

e) a registered charity as defined in subsection 248(1) of the Income Tax Act ;

(

f) a cooperative housing corporation , a hospital authority , a municipality , a public college , a school authority , or a university as those terms are defined in subsection 123(1) of the Excise Tax Act or a para-municipal organization as defined in

section 1 of

Part VI of

Schedule V to that Act;

(

g) an Indigenous governing body as defined in

section 2 of the Department of Indigenous Services Act or a corporation wholly owned by such a body; or

(

h) a prescribed person. ( propriétaire exclu )

fair rent , in respect of a residential property for a calendar year, means

(

a) the amount determined in prescribed manner in respect of the residential property for the calendar year; and

(

b) in the absence of a manner prescribed under paragraph (

a) in respect of the residential property for the calendar year, the amount that is 5% of the taxable value in respect of the residential property for the calendar year. ( loyer raisonnable )

hazardous condition , in respect of a residential property, means any of the following circumstances (other than prescribed circumstances):

(

a) a structural component of the residential property, including a roof, foundation, external walls, interior supporting walls, floors and staircases, is defective or damaged;

(

b) oil, gas or another poisonous or dangerous substance is present in the residential property;

(

c) any other condition relating to the residential property that is hazardous to the health or safety of its occupants; or

(

d) prescribed circumstances. ( condition dangereuse )

judge , in respect of any matter, means a judge of a superior court having jurisdiction in the province in which the matter arises or a judge of the Federal Court. ( juge )

long-term lease , in respect of land, means a lease, licence or similar arrangement under which continuous possession of the land is provided for a period of at least 20 years or a lease, licence or similar arrangement that contains an option to purchase the land. en ( bail de longue duré

e) Minister means the Minister of National Revenue. ( ministre )

month means a period beginning on a particular day in a calendar month and ending on

(

a) the day immediately before the day in the next calendar month that has the same calendar number as the particular day; or

(

b) if the next calendar month does not have a day that has the same calendar number as the particular day, the last day of that next calendar month. ( mois )

officer means, except in the definition specified Canadian corporation in this

section and in

section 59 , a person who is appointed or employed in the administration or enforcement of this Act. ( préposé )

owner of a residential property means a person that is identified as an owner in respect of the residential property under the land registration system or other similar system applicable where the residential property is located, or that could reasonably be considered to be an owner in respect of the residential property based on such a system, and includes a person that

(

a) is a life tenant under a life estate in respect of the residential property,

(

b) is a life lease holder in respect of the residential property,

(

c) has, under a long-term lease, continuous possession of the land on which the residential property is situated, or

(

d) is a prescribed person,

but does not include

(

e) a person that gives continuous possession of all the land on which the residential property is situated to persons referred to in paragraph (

b) or (c), or

(

f) a prescribed person. ( propriétaire )

ownership percentage , in respect of a particular owner of a residential property for a calendar year, means

(

a) a prescribed percentage; or

(

b) if no percentage is prescribed under paragraph (a),

(

i) if there are two or more owners of the residential property on December 31 of the calendar year

(

A) if the land registration system or other similar system applicable where the residential property is located indicates that the particular owner holds a percentage of the ownership in respect of the residential property, that percentage, and

(

B) in any other case, the percentage that is equal to 100% divided by the number of owners of the residential property, and

(ii)

in any other case, 100%. ( pourcentage de propriété )

permanent resident has the same meaning as in subsection 2(1) of the Immigration and Refugee Protection Act . ( résident permanent )

personal representative , in respect of a deceased individual, means the executor of the individual’s will, the liquidator of the individual’s succession, the administrator of the estate of the individual or any person that is responsible under the appropriate law for the proper collection, administration, disposition and distribution of the assets of the estate or succession of the individual. ( représentant personnel )

prescribed means

(

a) in the case of a form or the manner of filing a form, authorized by the Minister;

(

b) in the case of the information to be given on or with a form, specified by the Minister;

(

c) in the case of the manner of making or filing an election, authorized by the Minister; and

(

d) in any other case, prescribed by regulation or determined in accordance with rules prescribed by regulation. ( Version anglaise seulement )

property tax means a tax levied by a province, provincial agency or municipality to finance services ordinarily provided by municipalities in Canada and computed by applying one or more rates to all or part of the assessed value of real or immovable property. ( impôt foncier )

record means any material on which representations, in any form, of information or concepts are recorded or marked and that is capable of being read or understood by a person or a computer system or other device. ( registre )

residential property means property (other than prescribed property) that is situated in Canada and that is

(

a) a detached house or similar building, containing not more than three dwelling units, together with that proportion of the appurtenances to the building and the land subjacent or immediately contiguous to the building that is reasonably necessary for its use and enjoyment as a place of residence for individuals;

(

b) a part of a building that is a semi-detached house, rowhouse unit, residential condominium unit or other similar premises that is, or is intended to be, a separate parcel or other division of real or immovable property owned, or intended to be owned, apart from any other unit in the building together with that proportion of any common areas and other appurtenances to the building and the land subjacent or immediately contiguous to the building that is attributable to the house, unit or premises and that is reasonably necessary for its use and enjoyment as a place of residence for individuals; or

(

c) a prescribed property. ( immeuble résidentiel )

specified Canadian corporation , in respect of a calendar year, means a corporation that is incorporated or continued under the laws of Canada or a province other than a corporation that is, on December 31 of the calendar year

(

a) a corporation in respect of which the following persons have ownership or control, directly or indirectly, of shares of the corporation representing 10% or more of the value of the equity in the corporation or carrying 10% or more of the voting rights under all or under some circumstances:

(

i) an individual who is neither a citizen nor a permanent resident,

(ii)

a corporation that is incorporated or continued otherwise than under the laws of Canada or a province, or

(iii)

any combination of individuals or corporations referred to in subparagraphs (

i) and (ii);

(

b) a corporation without share capital having

(

i) a chairperson or other presiding officer who is neither a citizen nor a permanent resident, or

(ii)

10% or more of its directors who are neither citizens nor permanent residents; or

(

c) a prescribed corporation. ( personne morale canadienne déterminé

e) specified Canadian partnership , in respect of a calendar year, means

(

a) a partnership, each member of which is, on December 31 of the calendar year, an excluded owner or a specified Canadian corporation; or

(

b) a prescribed partnership. ( société de personnes canadienne déterminé

e) specified Canadian trust , in respect of a calendar year and a residential property, means

(

a) a trust under which each beneficiary having a beneficial interest in the residential property is, on December 31 of the calendar year, an excluded owner or a specified Canadian corporation; or

(

b) a prescribed trust. ( fiducie canadienne déterminé

e) tax means tax payable under this Act. ( taxe )

taxable value , in respect of a residential property for a calendar year, means an amount that is

(

a) a prescribed amount; or

(

b) if no amount is prescribed under paragraph (a), the greater of

(

i) the value established in respect of the residential property by an authority that has the power by or under

an Act of Parliament or the legislature of a province to establish the assessed value of real or immovable property for the purpose of computing a property tax, and

(ii)

the residential property’s most recent sale price on or before December 31 of the calendar year. ( valeur imposable )

Meaning of administration or enforcement of this Act

For greater certainty, a reference in this Act to the administration or enforcement of this Act includes the collection of any amount payable under this Act.

Arm’s length

(1) For the purposes of this Act,

(

a) related persons are deemed not to deal with each other at arm’s length; and

(

b) it is a question of fact whether persons not related to each other are, at any particular time, dealing with each other at arm’s length.

Related persons

(2) For the purposes of this Act, persons are deemed to be related to each other if they are related persons within the meaning of subsections 251(2) to (6) of the Income Tax Act .

Partnership

(3) For the purposes of this Act, a member of a partnership is deemed to be related to the partnership.

PART 2

Her Majesty

Binding on Her Majesty

This Act is binding on Her Majesty in right of Canada or a province.

PART 3

Application of Tax

Meaning of qualifying occupancy period

(1) In this section, qualifying occupancy period , in respect of a residential property in relation to an owner of the residential property, means a period of at least one month in a calendar year during which one of the following individuals (other than an individual that is an excluded individual pursuant to paragraph (10)(

b) or a prescribed individual) has continuous occupancy of a dwelling unit that is part of the residential property:

(

a) an individual who deals at arm’s length with the owner and with any spouse or common-law partner of the owner and who is given continuous occupancy of the dwelling unit under an agreement evidenced in writing;

(

b) an individual who does not deal at arm’s length with the owner or with any spouse or common-law partner of the owner and who is given continuous occupancy of the dwelling unit under an agreement evidenced in writing and for consideration that is not below the fair rent for the residential property, prorated for the period;

(

c) an individual who is the owner or the owner’s spouse or common-law partner, who is in Canada for the purpose of pursuing authorized work under a Canadian work permit and who occupies the dwelling unit in relation to that purpose;

(

d) an individual who is a spouse, common-law partner, parent or child of the owner and who is a citizen or permanent resident; or

(

e) a prescribed individual.

Exclusion — qualifying occupancy period

(2) Despite subsection (1), a qualifying occupancy period does not include a period that is a calendar month during which the only individuals who have continuous occupancy of a dwelling unit are the owner or a spouse, common-law partner, parent or child of the owner, if each of those individuals resides or lodges at a place other than the residential property for an equal or greater number of days than the number of days that they reside or lodge at the residential property.

Tax payable

(3) Subject to this Act, every person that is, on December 31 of a calendar year, an owner (other than an excluded owner) of a residential property must pay to Her Majesty in right of Canada tax in respect of the residential property for the calendar year in the amount determined by the formula

A × B × C where A

is 1%;

(

a) if the person has filed an election made under subsection (4) in respect of the residential property for the calendar year, the fair market value of the residential property, or

(

b) in any other case, the taxable value in respect of the residential property; and

is the ownership percentage in respect of the person in respect of the residential property for the calendar year.

Election for fair market value

(4) For the purpose of determining the tax under subsection (3) in respect of a residential property for a calendar year, a person may elect to use the fair market value of the residential property, as determined in a manner satisfactory to the Minister, at any time on or after January 1 of the calendar year and on or before April 30 of the following calendar year.

Form and manner of filing

(5) An election under subsection (4) in respect of a residential property for a calendar year is to be made in prescribed form containing prescribed information and is to be filed with the Minister in prescribed manner on or before

(

a) April 30 of the following calendar year; or

(

b) any later day that the Minister may allow.

When tax required to be paid

(6) The tax payable by a person under subsection (3) in respect of a residential property for a calendar year must be paid by the person to the Receiver General on or before April 30 of the following calendar year.

Tax not payable

(7) No tax is payable under subsection (3) by a person in respect of a residential property (other than a prescribed residential property) for a calendar year if

(

a) the person is an owner of the residential property solely in their capacity as

(

i) a partner of a partnership that is a specified Canadian partnership in respect of the calendar year, or

(ii)

a trustee of a trust that is a specified Canadian trust in respect of the calendar year and the residential property;

(

b) the person is in respect of the calendar year a specified Canadian corporation;

(

c) the residential property is not suitable for year-round use as a place of residence;

(

d) the residential property is seasonally inaccessible because public access is not maintained year-round;

(

e) the residential property is uninhabitable for a period of at least 60 consecutive days in the calendar year as a result of a disaster or hazardous condition caused by circumstances beyond the reasonable control of an owner of the residential property and this paragraph did not apply in respect of the same disaster or hazardous condition for more than one prior calendar year;

(

f) a dwelling unit that is part of the residential property is uninhabitable for a period of at least 120 consecutive days in the calendar year as a result of a renovation to the residential property, any work in relation to the renovation is carried on without unreasonable delay and this paragraph did not apply in respect of the residential property for any of the nine prior calendar years;

(

g) the person becomes an owner of the residential property in the calendar year and was never an owner of the residential property in the prior nine calendar years;

(

h) the person died during the calendar year or the prior calendar year;

(

i) the person is the personal representative in respect of a deceased individual who was an owner of the residential property during the calendar year or the prior calendar year and the person was not otherwise an owner of the residential property in either of those calendar years;

(

j) the following conditions are met:

(

i) an individual who was an owner of the residential property died during the calendar year or the prior calendar year and the individual’s ownership percentage in respect of the residential property at the time of death was at least 25%, and

(ii)

the person was an owner of the residential property on the day the individual died;

(

k) the construction of the residential property is not substantially completed before April of the calendar year;

(

l) the construction of the residential property is substantially completed after March of the calendar year, the residential property is offered for sale to the public during the calendar year and the residential property has never been occupied by an individual as a place of residence or lodging during the calendar year;

(

m) the residential property is located in a prescribed area and prescribed conditions, if any, are met; or

(

n) the person is a prescribed person.

Tax not payable — primary place of residence

(8) Subject to subsection (10), no tax is payable under subsection (3) by an individual in respect of a residential property for a calendar year if a dwelling unit that is part of the residential property is, for the calendar year, the primary place of residence of

(

a) the individual or the individual’s spouse or common-law partner; or

(

b) a child of the individual or the individual’s spouse or common-law partner and the child occupies the residential property for the purposes of authorized study at a designated learning institution as defined in

section 211.1 of the Immigration and Refugee Protection Regulations .

Tax not payable — qualifying occupancy

(9) Subject to subsection (10), no tax is payable under subsection (3) by an owner of a residential property for a calendar year if the number of days during the calendar year that are included in a qualifying occupancy period in respect of the residential property in relation to the owner is 180 days or more. No single day is to be counted more than once in the determination of the number of days during the calendar year that are included in a qualifying occupancy period in respect of the residential property in relation to an owner.

Exception — multiple residential properties

(10) If, on December 31 of a calendar year, an individual who is neither a citizen nor a permanent resident is an owner of a particular residential property and either the individual or the individual’s spouse or common-law partner who is neither a citizen nor a permanent resident is an owner of one or more other residential properties (which particular and other residential properties are referred to as the “specified residential properties” in this subsection), the following rules apply:

(a)

subsection (8) does not apply to the specified residential properties for the calendar year, other than the residential property in respect of which an election made under subsection (11) or (12) has been filed under subsection (13) in respect of the calendar year; and

(

b) for the purposes of subsection (1), the individual and the individual’s spouse or common-law partner are excluded individuals in relation to an owner of any of the specified residential properties for the calendar year, other than the residential property in respect of which an election made under subsection (11) or (12) has been filed under subsection (13) in respect of the calendar year.

Election

(11) If, on December 31 of a calendar year, an individual who is neither a citizen nor a permanent resident is an owner of two or more residential properties and it is not the case that the individual has a spouse or common-law partner (other than a citizen or permanent resident) who is an owner of a residential property, the individual may elect to designate one of those residential properties for the calendar year for the purposes of subsection (10). Not more than one election may be made by the individual for the calendar year.

Joint election

(12) If, on December 31 of a calendar year, an individual who is neither a citizen nor a permanent resident and is an owner of one or more residential properties and the individual’s spouse or common-law partner who is neither a citizen nor a permanent resident is an owner of one or more residential properties, the individual and the individual’s spouse or common-law partner may jointly elect to designate one of those residential properties for the calendar year for the purposes of subsection (10). Not more than one joint election may be made by the individual and the individual’s spouse or common-law partner for the calendar year.

Form and manner of filing

(13) An election under subsection (11) or (12) to designate a residential property for a calendar year is to be made in prescribed form containing prescribed information and is to be filed with the Minister in prescribed manner on or before

(

a) April 30 of the following calendar year; or

(

b) any later day that the Minister may allow.

PART 4

Returns

Return required

(1) A person that is an owner (other than an excluded owner) of one or more residential properties on December 31 of a calendar year is required to file a return for each residential property for the calendar year.

Return not required — regulations

(2) Despite subsection (1), a person is not required to file a return for a residential property for a calendar year if the person is a prescribed person or if the residential property is a prescribed property.

Return required — regulations

(3) Despite subsection (1), a person is required to file a return for a residential property for a calendar year if the person is a prescribed person.

Form and content

A person that is required under

section 7 to file a return for a residential property for a calendar year must

(

a) make the return in prescribed form containing prescribed information and file it with the Minister in prescribed manner on or before April 30 of the following calendar year; and

(

b) indicate in the return the amount of tax, if any, determined by the formula in subsection 6 (3) in respect of the residential property for the calendar year.

Definition of electronic filing

(1) For the purposes of this section, electronic filing means using electronic media in a manner specified in writing by the Minister.

Electronic filing of return

(2) The Minister may require that a return under this Act be filed by way of electronic filing.

Acceptance

(3) A return under this Act filed by way of electronic filing is deemed to be filed with the Minister on the day on which the Minister acknowledges acceptance of it.

Demand for return

The Minister may, on demand sent by the Minister, require a person to file, within any reasonable time stipulated in the demand, a return under this Act for any calendar year designated in the demand.

PART 5

Trustees, Receivers and Representatives

Definitions

(1) The following

definitions apply in this section.

bankrupt has the same meaning as in

section 2 of the Bankruptcy and Insolvency Act . ( failli )

business includes a part of a business. ( entreprise )

receiver means a person that

(

a) under the authority of a debenture, bond or other debt security, of a court order or of

an Act of Parliament or of the legislature of a province, is empowered to operate or manage a business or a property of another person;

(

b) is appointed by a trustee under a trust deed in respect of a debt security to exercise the authority of the trustee to manage or operate a business or a property of the debtor under the debt security;

(

c) is appointed by a bank to act as an agent or mandatary of the bank in the exercise of the authority of the bank under subsection 426(3) of the Bank Act in respect of property of another person;

(

d) is appointed as a liquidator to liquidate the assets of a corporation or to wind up the affairs of a corporation; or

(

e) is appointed as a committee, guardian, curator, tutor or mandatary in case of incapacity with the authority to manage and care for the affairs and assets of an individual who is incapable of managing those affairs and assets.

It includes a person that is appointed to exercise the authority of a creditor under a debenture, bond or other debt security to operate or manage a business or a property of another person, but, if a person is appointed to exercise the authority of a creditor under a debenture, bond or other debt security to operate or manage a business or a property of another person, it does not include that creditor. ( séquestre )

relevant assets of a receiver means

(

a) if the receiver’s authority relates to all the properties, businesses, affairs and assets of a person, all those properties, businesses, affairs and assets; and

(

b) if the receiver’s authority relates to only part of the properties, businesses, affairs or assets of a person, that part of the properties, businesses, affairs or assets. ( actif pertinent )

representative means a person, other than a trustee in bankruptcy or a receiver, that is administering, winding up, controlling or otherwise dealing with any property, business, estate or succession of another person. ( représentant )

Trustee in bankruptcy — obligations

(2) For the purposes of this Act, if on a particular day a person becomes a bankrupt,

(

a) the trustee in bankruptcy, and not the person, is liable for the payment of any amount (other than an amount that relates solely to activities in which the person begins to engage on or after the particular day and to which the bankruptcy does not relate) that is required to be paid by the person under this Act, during the period beginning on the day immediately after the day on which the trustee became the trustee in bankruptcy of the person and ending on the day on which the discharge of the trustee is granted under the Bankruptcy and Insolvency Act , except that

(

i) the trustee is liable for the payment of any amount that is required to be paid by the person under this Act after the particular day in respect of calendar years that ended on or before the particular day but only to the extent of the property of the person in possession of the trustee available to satisfy the liability,

(ii)

the trustee is not liable for the payment of any amount for which a receiver is liable under subsection (3), and

(iii)

the payment by the person of an amount in respect of the liability discharges the liability of the trustee to the extent of that amount;

(

b) subject to paragraph (d), the trustee in bankruptcy must file with the Minister in the prescribed form and manner all returns in respect of the activities of the person to which the bankruptcy relates for the calendar years of the person ending in the period beginning on the day immediately after the particular day and ending on the day on which the discharge of the trustee is granted under the Bankruptcy and Insolvency Act and that are required under this Act to be filed by the person, as if those activities were the only activities of the person;

(

c) subject to paragraph (d), if the person has not on or before the particular day filed a return required under this Act to be filed by the person for a calendar year of the person ending on or before the particular day, the trustee in bankruptcy must, unless the Minister waives in writing the requirement for the trustee to file the return, file with the Minister in the prescribed form and manner a return for that calendar year of the person; and

(

d) if there is a receiver with authority in respect of any business, property, affairs or assets of the person, the trustee in bankruptcy is not required to include in any return any information that the receiver is required under subsection (3) to include in a return.

Receiver’s obligations

(3) For the purposes of this Act, if on a particular day a receiver is vested with authority to manage, operate, liquidate or wind up any business or property, or to manage and care for the affairs and assets, of a person,

(

a) if the relevant assets of the receiver are a part and not all of the person’s businesses, properties, affairs or assets, the relevant assets of the receiver are deemed to be, throughout the period during which the receiver is acting as receiver of the person, separate from the remainder of the businesses, properties, affairs or assets of the person as though the relevant assets were businesses, properties, affairs or assets, as the case may be, of a separate person;

(

b) the person and the receiver are jointly and severally, or solidarily, liable for the payment of any amount that is required to be paid by the person under this Act before or during the period during which the receiver is acting as receiver of the person to the extent that the amount can reasonably be considered to relate to the relevant assets of the receiver or to the businesses, properties, affairs or assets of the person that would have been the relevant assets of the receiver if the receiver had been acting as receiver of the person at the time the amount became payable except that

(

i) the receiver is liable for the payment of any amount that is required to be paid by the person under this Act before that period only to the extent of the property of the person in possession or under the control and management of the receiver after

(

A) satisfying the claims of creditors whose claims ranked, on the particular day, in priority to the claim of the Crown in respect of the amount, and

(

B) paying any amounts that the receiver is required to pay to a trustee in bankruptcy of the person,

(ii)

the person is not liable for the payment of any amount payable by the receiver, and

(iii)

the payment by the person or the receiver of an amount in respect of the liability discharges the joint and several, or solidary, liability to the extent of that amount;

(

c) the receiver must file with the Minister in the prescribed form and manner all returns in respect of the relevant assets of the receiver for calendar years ending in the period during which the receiver is acting as receiver and that are required under this Act to be made by the person, as if the relevant assets were the only businesses, properties, affairs and assets of the person; and

(

d) if the person has not on or before the particular day filed a return required under this Act to be filed by the person for a calendar year of the person ending on or before the particular day, the receiver must, unless the Minister waives in writing the requirement for the receiver to file the return, file with the Minister in the prescribed form and manner a return for that calendar year that relates to the businesses, properties, affairs or assets of the person that would have been the relevant assets of the receiver if the receiver had been acting as receiver of the person during that calendar year.

Certificates for receivers and representatives

(4) Every receiver and representative that controls property of another person that is required to pay any amount under this Act must, before distributing the property to any person, obtain a certificate from the Minister certifying that the following amounts have been paid or that security for the payment of them has, in accordance with this Act, been accepted by the Minister:

(

a) all amounts that are payable by the other person under this Act in respect of the calendar year during which the distribution is made, or any previous calendar year; and

(

b) all amounts that are, or can reasonably be expected to become, payable under this Act by the representative or receiver in that capacity in respect of the calendar year during which the distribution is made, or any previous calendar year.

Liability for failure to obtain certificate

(5) Any receiver or representative that distributes property without obtaining a certificate in respect of the amounts referred to in subsection (4) is personally liable for the payment of those amounts to the extent of the value of the property so distributed.

PART 6

Anti-avoidance

Definitions

(1) The following

definitions apply in this section.

tax benefit means a reduction, an avoidance or a deferral of an amount of tax or other amount payable by a person under this Act or an increase in an amount payable to a person under this Act. ( avantage fiscal )

tax consequences to a person means the amount of tax or other amount payable by, or payable to, the person under this Act or any other amount that is relevant for the purposes of computing that amount. ( attribut fiscal )

transaction includes an arrangement or event. ( opération )

General anti-avoidance provision

(2) If a transaction is an avoidance transaction, the tax consequences to a person must be determined as is reasonable in the circumstances in order to deny a tax benefit that, but for this section, would result directly or indirectly from that transaction or from a series of transactions that include that transaction.

Avoidance transaction

(3) An avoidance transaction means any transaction

(

a) that, but for this section, would result directly or indirectly in a tax benefit, unless the transaction may reasonably be considered to have been undertaken or arranged primarily for bona fide purposes other than to obtain the tax benefit; or

(

b) that is part of a series of transactions, which series, but for this section, would result directly or indirectly in a benefit, unless the transaction may reasonably be considered to have been undertaken or arranged primarily for bona fide purposes other than to obtain the tax benefit.

Provision not applicable

(4) For greater certainty, subsection (2) does not apply in respect of a transaction if it may reasonably be considered that the transaction would not result directly or indirectly in a misuse of the provisions of this Act or in an abuse having regard to the provisions of this Act (other than this section) read as a whole.

Determination of tax consequences

(5) Without restricting the generality of subsection (2), in determining the tax consequences to a person, as is reasonable in the circumstances, in order to deny a tax benefit that would, but for this section, result directly or indirectly from an avoidance transaction

(

a) the nature of any payment or other amount may be recharacterized; and

(

b) the effects that would otherwise result from the application of other provisions of this Act may be ignored.

Exception

(6) Despite any other provision of this Act, the tax consequences to any person following the application of this

section must only be determined through an assessment, reassessment or additional assessment involving the application of this section.

Definitions

(1) The following

definitions apply in this section.

parameter change means a change in any of the following:

(

a) a rate;

(

b) words or expressions defined in a provision of this Act. ( modification d’un paramètre )

tax benefit has the meaning assigned by subsection 12 (1). ( avantage fiscal )

transaction has the meaning assigned by subsection 12 (1). ( opération )

Parameter change — transactions

(2) (

a) a transaction, or a series of transactions, involving property is made between two or more persons, all of whom are not dealing with each other at arm’s length at the time any of those transactions are made,

(

b) the transaction, any of the transactions in the series of transactions or the series of transactions would in the absence of this

section result directly or indirectly in a tax benefit to one or more of the persons involved in the transaction or series of transactions, and

(

c) it may not reasonably be considered that the transaction, or the series of transactions, has been undertaken or arranged primarily for bona fide purposes other than to obtain a tax benefit, arising from a parameter change, for one or more of the persons involved in the transaction or series of transactions,

the amount of tax or other amount payable by, or payable to, any of those persons under this Act, or any other amount that is relevant for the purposes of computing that amount must be determined as is reasonable in the circumstances in order to deny the tax benefit to any of those persons.

Denying benefit on transactions

(3) Despite any other provision of this Act, a tax benefit must only be denied under subsection (2) through an assessment, reassessment or additional assessment.

PART 7

Administration and Enforcement

DIVISION 1

Payments

Large payments

Every person that is required under this Act to pay an amount to the Receiver General must, if the amount is $50,000 or more, make the payment to the account of the Receiver General at

(

a) a bank;

(

b) a credit union;

(

c) a corporation authorized under the laws of Canada or a province to carry on the business of offering its services as a trustee to the public; or

(

d) a corporation that is authorized under the laws of Canada or a province to accept deposits from the public and that carries on the business of lending money on the security of real property or immovables or investing in indebtedness on the security of mortgages on real property or hypothecs on immovables.

Small amounts owing

(1) If, at any time, the total of all unpaid amounts owing by a person to the Receiver General under this Act does not exceed $2.00, the amount owing by the person is deemed to be nil.

Small amounts payable

(2) If, at any time, the total of all amounts payable by the Minister to a person under this Act does not exceed $2.00, the Minister may apply those amounts against any amount owing, at that time, by the person to Her Majesty in right of Canada. However, if the person, at that time, does not owe any amount to Her Majesty in right of Canada, those amounts payable are deemed to be nil.

Execution of returns, etc.

A return (other than a return filed by way of electronic filing under

section 9 ), certificate or other document made under this Act by a person that is not an individual must be signed on behalf of the person by an individual duly authorized to do so by the person or the governing body of the person.

Extension of time

(1) The Minister may at any time extend, in writing, the time for filing a return under this Act.

Effect of extension

(2) If the Minister extends the time within which a person must file a return under subsection (1),

(

a) the return must be filed within the time so extended;

(

b) any amount payable that the person is required to declare in the return must be paid within the time so extended;

(

c) any interest payable under

section 23 on the amount referred to in paragraph (

b) must be calculated as though the amount were required to be paid on the day on which the extended time expires; and

(

d) any penalty payable under

section 47 in respect of the return must be calculated as though the return were required to be filed on the day on which the extended time expires.

Statutory recovery rights

Except as specifically provided under this Act or the Financial Administration Act , no person has a right to recover any money paid to Her Majesty in right of Canada as or on account of, or that has been taken into account by Her Majesty in right of Canada as, an amount payable under this Act.

DIVISION 2

Administration and Officers

Minister’s duty

The Minister must administer and enforce this Act and the Commissioner may exercise the powers and perform the duties of the Minister under this Act.

Staff

(1) The persons that are necessary to administer and enforce this Act are to be appointed, employed or engaged in the manner authorized by law.

Delegation of powers

(2) The Minister may authorize any person employed or engaged by the Canada Revenue Agency or who occupies a position of responsibility in the Canada Revenue Agency to exercise powers or perform duties of the Minister, including any judicial or quasi-judicial power or duty of the Minister, under this Act.

Administration of oaths

Any person, if designated by the Minister for the purpose, may administer oaths and take and receive affidavits, declarations and affirmations for the purposes of or incidental to the administration or enforcement of this Act, and every person so designated has for those purposes all the powers of a commissioner for administering oaths or taking affidavits.

Inquiry

(1) The Minister may, for any purpose related to the administration or enforcement of this Act, authorize any person, whether or not the person is an officer of the Canada Revenue Agency, to make any inquiry that the Minister may deem necessary with reference to anything relating to the administration or enforcement of this Act.

Appointment of hearing officer

(2) If the Minister, under subsection (1), authorizes a person to make an inquiry, the Minister must forthwith apply to the Tax Court of Canada for an order appointing a hearing officer before whom the inquiry will be held.

Powers of hearing officer

(3) For the purposes of an inquiry authorized under subsection (1), a hearing officer appointed under subsection (2) in relation to the inquiry has all the powers conferred on a commissioner by sections 4 and 5 of the Inquiries Act and that may be conferred on a commissioner under

section 11 of that Act.

When powers to be exercised

(4) A hearing officer appointed under subsection (2) in relation to an inquiry must exercise the powers conferred on a commissioner by

section 4 of the Inquiries Act in relation to any persons that the person authorized to make the inquiry considers appropriate for the conduct of the inquiry, but the hearing officer is not to exercise the power to punish any person unless, on application by the hearing officer, a judge, including a judge of a county court, certifies that the power may be exercised in the matter disclosed in the application and the applicant has given to the person, in respect of whom the power is proposed to be exercised, 24 hours notice of the hearing of the application, or any shorter notice that the judge considers reasonable.

Rights of witnesses

(5) Any person who gives evidence in an inquiry authorized under subsection (1) is entitled to be represented by counsel and, on request made by the person to the Minister, to receive a transcript of that evidence.

Rights of person investigated

(6) Any person whose affairs are investigated in the course of an inquiry authorized under subsection (1) is entitled to be present and to be represented by counsel throughout the inquiry unless the hearing officer appointed under subsection (2), on application by the Minister or a person giving evidence, orders otherwise in relation to the whole or any part of the inquiry, on the ground that the presence of the person and the person’s counsel, or either of them, would be prejudicial to the effective conduct of the inquiry.

DIVISION 3

Interest

Specified rate of interest

(1) For the purposes of every provision of this Act that requires interest to be computed at a specified rate

(

a) if the interest is to be paid or applied on an amount payable by the Minister to a person, the specified rate in effect during a calendar quarter — being a period of three months beginning on the first day of January, April, July or October — is

(

i) the prescribed rate, or

(ii)

if no rate is prescribed under subparagraph (i), the interest rate determined for the calendar quarter under subsection 2(2) of the Interest Rates (Excise Act, 2001) Regulations ; and

(

b) in any other case, the specified rate in effect during a calendar quarter is

(

i) the prescribed rate, or

(ii)

if no rate is prescribed under subparagraph (i), the interest rate determined for the calendar quarter under subsection 2(1) of the Interest Rates (Excise Act, 2001) Regulations .

Compound interest

(2) If a person fails to pay an amount to the Receiver General as and when required under this Act, the person must pay to the Receiver General interest on the amount. The interest must be compounded daily at the specified rate and computed for the period that begins on the first day after the day on or before which the amount was required to be paid and that ends on the day the amount is paid.

Payment of interest that is compounded

(3) For the purposes of subsection (2), interest that is compounded on a particular day on an unpaid amount of a person is deemed to be required to be paid by the person to the Receiver General at the end of the particular day, and, if the person has not paid the interest so computed by the end of the day after the particular day, the interest must be added to the unpaid amount at the end of the particular day.

Payment before specified date

(4) If the Minister has served a demand that a person pay on or before a specified date all amounts payable by the person under this Act on the date of the demand, and the person pays the amount demanded on or before the specified date, the Minister must waive any interest that would otherwise apply in respect of the amount demanded for the period beginning on the first day following the date of the demand and ending on the day of payment.

Compound interest on amounts owed by Her Majesty

Interest must be compounded daily at the specified rate on amounts owed under this Act by Her Majesty in right of Canada to a person and computed for the period beginning on the first day after the day on which the amount is required to be paid by Her Majesty in right of Canada and ending on the day on which the amount is paid or is applied against an amount owed by the person to Her Majesty in right of Canada.

Interest if Act amended

For greater certainty, if a provision of

an Act amends this Act and provides that the amendment comes into force on, or applies as of, a particular day that is before the day on which the provision is assented to, the provisions of this Act that relate to the calculation and payment of interest apply in respect of the amendment as though the provision had been assented to on the particular day.

Waiving or reducing interest

(1) The Minister may, on or before the day that is 10 calendar years after the end of a calendar year of a person, or on application by the person on or before that day, waive, cancel or reduce any interest payable by the person under this Act on an amount that is required to be paid by the person under this Act in respect of the calendar year.

Interest where amounts waived or reduced

(2) If a person has paid an amount of interest and the Minister has waived or reduced under subsection (1) any portion of the amount, the Minister must pay interest at the specified rate on an amount equal to the portion of the amount that was waived or reduced beginning on the day that is 30 days after the day on which the Minister received a request in a manner satisfactory to the Minister to apply that subsection and ending on the day on which the portion is paid to the person.

Cancellation of penalties and interest

If at any time a person pays all amounts under

section 6 payable by the person under this Act for a calendar year of the person and, immediately before that time, the total, for the calendar year, of all interest payable by the person under

section 23 and penalties payable under

section 47 is not more than $25, the Minister may cancel the total of the penalties and interest.

Dishonoured instruments

For the purposes of this Act and

section 155.1 of the Financial Administration Act , any charge that is payable at any time by a person under the Financial Administration Act in respect of an instrument tendered in payment or settlement of an amount that is payable under this Act is deemed to be an amount that is payable by the person at that time under this Act. In addition,

Part II of the Interest and Administrative Charges Regulations does not apply to the charge and any debt under subsection 155.1(3) of the Financial Administration Act in respect of the charge is deemed to be extinguished at the time the total of the amount and any applicable interest under this Act is paid.

DIVISION 4

Records and Information

Keeping records

(1) Every person that pays or is required to pay an amount of tax and every person that is required under this Act to file a return must keep all records that are necessary to enable the determination of the person’s liabilities and obligations under this Act and whether the person has complied with this Act.

Minister may specify information

(2) The Minister may specify the form a record is to take and any information that the record must contain.

Language and location of record

(3) Unless otherwise authorized by the Minister, a record must be kept in Canada in English or in French.

Electronic records

(4) Every person required under this Act to keep a record that does so electronically must ensure that all equipment and software necessary to make the record intelligible are available during the retention period required for the record.

Exemptions

(5) The Minister may, on any terms and conditions that are acceptable to the Minister, exempt a person or a class of persons from the requirement in subsection (4).

Inadequate records

(6) If a person fails to keep adequate records for the purposes of this Act, the Minister may, in writing, require the person to keep any records that the Minister may specify, and the person must keep the records specified by the Minister.

General period for retention

(7) Every person that is required to keep records must retain them until the expiry of six years after the end of the year to which they relate or for any other period that may be prescribed.

Objection or appeal

(8) If a person that is required under this Act to keep records serves a notice of objection or is a party to an appeal or reference under this Act, the person must retain every record that pertains to the subject-matter of the objection, appeal or reference until the objection, appeal or reference is finally disposed of.

Demand by Minister

(9) If the Minister is of the opinion that it is necessary for the administration or enforcement of this Act, the Minister may, by a demand served personally or confirmed delivery service, require any person required under this Act to keep records to retain those records for any period that is specified in the demand, and the person must comply with the demand.

Permission for earlier disposal

(10) A person that is required under this Act to keep records may dispose of them before the expiry of the period during which they are required to be kept if written permission for their disposal is given by the Minister.

Electronic funds transfer

For greater certainty, information obtained by the Minister under

Part XV.1 of the Income Tax Act may be used for the purposes of this Act.

Requirement to provide information or record

(1) Despite any other provision of this Act, the Minister may, subject to subsection (3), for any purpose related to the administration or enforcement of this Act, by a notice served or sent in accordance with subsection (2), require any person to provide any information or record.

Notice

(2) A notice referred to in subsection (1) may be

(

a) served personally;

(

b) sent by confirmed delivery service; or

(

c) sent electronically to a bank or credit union that has provided written consent to receive notices under subsection (1) electronically.

Unnamed persons

(3) The Minister must not impose on any person (in this

section referred to as a “third party”) a requirement to provide information or any record relating to one or more unnamed persons unless the Minister first obtains the authorization of a judge under subsection (4).

Judicial authorization

(4) A judge of the Federal Court may, on application by the Minister and subject to any conditions that the judge considers appropriate, authorize the Minister to impose on a third party a requirement under subsection (1) relating to an unnamed person or more than one unnamed person (in this subsection referred to as the “group”) if the judge is satisfied by information on oath that

(

a) the person or group is ascertainable; and

(

b) the requirement is made to verify compliance by the person or persons in the group with any obligation under this Act.

Definitions

(1) The following

definitions apply in this section.

authorized person means a person who is engaged or employed, or who was formerly engaged or employed, by or on behalf of Her Majesty in right of Canada to assist in carrying out the provisions of this Act. ( personne autorisé

e) confidential information means information of any kind and in any form that relates to one or more persons and that is

(

a) obtained by or on behalf of the Minister for the purposes of this Act, or

(

b) prepared from information referred to in paragraph (a),

but does not include information that does not directly or indirectly reveal the identity of the person to whom it relates and, for the purposes of applying subsections (3), (13) and (14) to a representative of a government entity that is not an official, includes only the information described in subsection (6). ( renseignement confidentiel )

court of appeal has the same meaning as in

section 2 of the Criminal Code . ( cour d’appel )

government entity means

(

a) a department or agency of the government of Canada or of a province;

(

b) a municipality;

(

c) an aboriginal government as defined in subsection 2(1) of the Federal-Provincial Fiscal Arrangements Act ;

(

d) a corporation all of the shares (except directors’ qualifying shares) of the capital stock of which are owned by one or more persons each of which is

(

i) Her Majesty in right of Canada,

(ii)

Her Majesty in right of a province,

(iii)

a municipality, or

(iv)

a corporation described in this paragraph; or

(

e) a board or commission, established by Her Majesty in right of Canada or a province, that performs an administrative or regulatory function of government, or by a municipality, that performs an administrative or regulatory function of a municipality. ( entité gouvernementale )

municipality means an incorporated city, town, village, metropolitan authority, township, district, county or rural municipality or other incorporated municipal body however designated. ( municipalité )

official means a person that is employed in the service of, that occupies a position of responsibility in the service of, or that is engaged by or on behalf of Her Majesty in right of Canada or a province, or a person that was formerly so employed, that formerly occupied such a position or that formerly was so engaged. ( fonctionnaire )

representative of a government entity means a person that is employed in the service of, that occupies a position of responsibility in the service of, or that is engaged by or on behalf of, a government entity, and includes, for the purposes of subsections (2), (3), (13) and (14), a person that was formerly so employed, that formerly occupied such a position or that formerly was so engaged. ( représentant )

Provision of confidential information

(2) Except as authorized under this section, an official or other representative of a government entity must not knowingly

(

a) provide, or allow to be provided, to any person any confidential information;

(

b) allow any person to have access to any confidential information; or

(

c) use any confidential information other than in the course of the administration or enforcement of this Act.

Confidential information evidence not compellable

(3) Despite any other Act of Parliament or other law, no official or other representative of a government entity is required, in connection with any legal proceedings, to give or produce evidence relating to any confidential information.

Communications — proceedings have been commenced

(4) Subsections (2) and (3) do not apply in respect of

(

a) criminal proceedings, either by indictment or on

summary conviction, that have been commenced by the laying of an information or the preferring of an indictment, under

an Act of Parliament; or

(

b) any legal proceedings relating to the administration or enforcement of this Act, any other Act of Parliament or law of a province that provides for the imposition of a duty or tax, the Canada Pension Plan , the Employment Insurance Act or

Part 1 of the Greenhouse Gas Pollution Pricing Act .

Authorized provision of confidential information

(5) The Minister may provide appropriate persons with any confidential information that may reasonably be regarded as necessary solely for a purpose relating to the life, health or safety of an individual or to the environment in Canada or any other country.

Disclosure of confidential information

(6) An official may provide any confidential information to a person identified in subsection 211(6) of the Excise Act, 2001 , but only to the extent that the information is described in that subsection and solely for the applicable purposes identified in that subsection with any modifications that the circumstances require, including reading references to the Excise Act, 2001 as references to this Act.

Restrictions on information sharing

(7) No information may be provided to a representative of a government entity under subsection (6) in connection with a program, activity or service provided or undertaken by the government entity unless the government entity uses the business number as an identifier in connection with the program, activity or service.

Public disclosure

(8) The Minister may, in connection with a program, activity or service provided or undertaken by the Minister, make available to the public the business number of, and the name of (including any trade name or other name used by), the holder of a business number.

Public disclosure by representative of government entity

(9) A representative of a government entity may, in connection with a program, activity or service provided or undertaken by the government entity, make available to the public the business number of, and the name of (including any trade name or other name used by), the holder of a business number, if

(

a) a representative of the government entity was provided with that information under subsection (6); and

(

b) the government entity uses the business number as an identifier in connection with the program, activity or service.

Serious offences

(10) An official may provide information to a law enforcement officer of an appropriate police organization in the circumstances described in subsection 211(6.4) of the Excise Act, 2001 .

Threats to security

(11) An official may provide information to the head, or their delegate, of a recipient Government of Canada institution listed in

Schedule 3 to the Security of Canada Information Sharing Act in the circumstances described in subsection 211(6.5) of the Excise Act, 2001 .

Measures to prevent unauthorized use or disclosure

(12) The person presiding at a legal proceeding relating to the supervision, evaluation or discipline of an authorized person may order any measures that are necessary to ensure that confidential information is not used or provided to any person for any purpose not relating to that proceeding, including

(

a) holding a hearing in camera ;

(

b) banning the publication of the information;

(

c) concealing the identity of the person to whom the information relates; and

(

d) sealing the records of the proceeding.

Disclosure to person or on consent

(13) An official or other representative of a government entity may provide confidential information relating to a person

(

a) to that person; and

(

b) with the consent of that person, to any other person.

Appeal from order or direction

(14) An order or direction that is made in the course of or in connection with any legal proceedings and that requires an official or other representative of a government entity to give or produce evidence relating to any confidential information may, by notice served on all interested parties, be appealed forthwith by the Minister or by the person against whom the order or direction is made to

(

a) the court of appeal of the province in which the order or direction is made, in the case of an order or direction made by a court or other tribunal established under the laws of the province, whether that court or tribunal is exercising a jurisdiction conferred by the laws of Canada; and

(

b) the Federal Court of Appeal, in the case of an order or direction made by a court or other tribunal established under the laws of Canada.

Disposition of appeal

(15) The court to which an appeal is taken under subsection (14) may allow the appeal and quash the order or direction appealed from or may dismiss the appeal, and the rules of practice and procedure from time to time governing appeals to the courts must apply, with any modifications that the circumstances require, in respect of an appeal instituted under subsection (14).

Stay

(16) An appeal instituted under subsection (14) must stay the operation of the order or direction appealed from until judgment is pronounced.

DIVISION 5

Assessments

Assessment

(1) The Minister may assess a person for any amount of tax or other amount payable by the person under this Act and may, despite any previous assessment covering, in whole or in part, the same matter, vary the assessment, reassess the person or make any additional assessments that the circumstances require.

Liability not affected

(2) The liability of a person to pay an amount under this Act is not affected by an incorrect or incomplete assessment or by the fact that no assessment has been made.

Minister not bound

(3) The Minister is not bound by any return, or information provided by or on behalf of any person and may make an assessment despite any return, or information provided or not provided.

Assessment valid and binding

(4) An assessment, subject to being vacated on an objection or appeal under this Act and subject to a reassessment, is deemed to be valid and binding.

Assessment deemed valid

(5) Subject to being reassessed or vacated as a result of an objection or appeal under this Act, an assessment is deemed to be valid and binding despite any error, defect or omission in the assessment or in any proceeding under this Act relating to it.

Refund on reassessment

(6) If a person has paid an amount assessed under this

section and the amount paid exceeds the amount determined on reassessment to have been payable by the person, the Minister must refund to the person the amount of the excess, together with interest at the specified rate for the period beginning on the day the amount was paid by the person and ending on the day the refund is paid.

Interest on cancelled amounts

(7) Despite subsection (6), if a person has paid an amount of interest or penalty and the Minister waives or cancels that amount under

section 26 or 48 , the Minister must pay the amount to the person, together with interest on the amount at the specified rate for the period beginning on the day that is 30 days after the day on which the Minister received a request in a manner satisfactory to the Minister to apply that

section and ending on the day on which the amount is paid.

Restriction on payment by Minister

An amount under

section 33 is not to be paid to a person by the Minister at any time, unless all returns of which the Minister has knowledge and that are required to be filed at or before that time by the person under this Act, the Excise Tax Act , the Income Tax Act , the Excise Act, 2001 , the Air Travellers Security Charge Act and

Part 1 of the Greenhouse Gas Pollution Pricing Act have been filed with the Minister.

Notice of assessment

(1) After making an assessment under this Act, the Minister must send to the person assessed a notice of the assessment.

Payment of remainder

(2) If the Minister has assessed a person for an amount, any portion of that amount then remaining unpaid is payable to the Receiver General as of the date of the notice of assessment.

Limitation period for assessments

(1) Subject to subsections (2) to (6) and (9), no assessment in respect of an amount of tax or other amount payable by a person under this Act must be made more than four years after it became payable by the person under this Act.

Exception — objection or appeal

(2) A variation of an assessment, or a reassessment, in respect of an amount of tax or other amount payable by a person under this Act may be made at any time if the variation or reassessment is made

(

a) to give effect to a decision on an objection or appeal;

(

b) with the written consent of an appellant to dispose of an appeal; or

(

c) to give effect to an alternative basis or argument advanced by the Minister under subsection (6).

Exception — neglect or fraud

(3) An assessment in respect of any matter may be made at any time if the person to be assessed has, in respect of that matter,

(

a) made a misrepresentation that is attributable to their neglect, carelessness or wilful default; or

(

b) committed fraud with respect to a return filed under this Act.

Exception — other year

(4) If, in making an assessment, the Minister determines that a person has paid in respect of any matter an amount as or on account of tax payable for a particular calendar year of the person that was in fact payable for another calendar year of the person, the Minister may at any time make an assessment for that other year in respect of that matter.

Exception — failure to file return

(5) An assessment in respect of a residential property of a person for a calendar year may be made at any time if the person to be assessed has not filed a return in respect of that property for the calendar year.

Alternative basis or argument

(6) The Minister may advance an alternative basis or argument in support of an assessment of a person, or in support of all or any portion of the total amount determined on assessment to be payable by a person under this Act, at any time after the period otherwise limited by subsection (1) for making the assessment unless, on an appeal under this Act,

(

a) there is relevant evidence that the person is no longer able to adduce without leave of the court; and

(

b) it is not appropriate in the circumstances for the court to order that the evidence be adduced.

Limitation

(7) If a reassessment of a person is made that gives effect to an alternative basis or argument advanced by the Minister under subsection (6) in support of a particular assessment of the person, the Minister is not to reassess for an amount that is greater than the total amount of the particular assessment.

Exception

(8) Subsection (7) does not apply to any portion of an amount determined on reassessment that the Minister would be entitled to reassess under this Act at any time after the period otherwise limited by subsection (1) for making the reassessment if this Act were read without reference to subsection (6).

Exception — waiver

(9) An assessment in respect of any matter specified in a waiver filed under subsection (10) may be made at any time within the period specified in the waiver unless the waiver has been revoked under subsection (11), in which case an assessment may be made at any time during the 180 days that the waiver remains in effect.

Filing waiver

(10) Any person may, within the time otherwise limited by subsection (1) for an assessment, waive the application of subsection (1) by filing with the Minister a waiver in the prescribed form specifying the period for which, and the matter in respect of which, the person waives the application of that subsection.

Revoking waiver

(11) Any person that has filed a waiver may revoke it by filing with the Minister a notice of revocation of the waiver in the prescribed form and manner. The waiver remains in effect for 180 days after the day on which the notice is filed.

DIVISION 6

Objections to Assessment

Objection to assessment

(1) Any person that has been assessed and that objects to the assessment may, within 90 days after the day notice of the assessment is sent to the person, file with the Minister a notice of objection in the prescribed form and manner setting out the reasons for the objection and all relevant facts.

Limitation on objections

(2) Despite subsection (1), no objection may be made by a person in respect of an issue for which the right of objection has been waived in writing by the person.

Acceptance of objection

(3) The Minister may accept a notice of objection even though it was not filed in the prescribed form and manner.

Consideration of objection

(4) On receipt of a notice of objection, the Minister must, without delay, reconsider the assessment and vacate or confirm it or make a reassessment.

Waiving reconsideration

(5) If, in a notice of objection, a person that wishes to appeal directly to the Tax Court of Canada requests the Minister not to reconsider the assessment objected to, the Minister may confirm the assessment without reconsideration.

Notice of decision

(6) After reconsidering an assessment under subsection (4) or confirming an assessment under subsection (5), the Minister must notify the person objecting to the assessment of the Minister’s decision in writing.

Extension of time by Minister

(1) If no objection to an assessment is filed under

section 37 within the time limited under this Act, a person may make an application to the Minister to extend the time for filing a notice of objection and the Minister may grant the application.

Contents of application

(2) An application must set out the reasons why the notice of objection was not filed within the time limited under this Act for doing so.

How application made

(3) An application must be made by delivering or mailing, to the Assistant Commissioner of the Appeals Branch of the Canada Revenue Agency, the application accompanied by a copy of the notice of objection.

Defect in application

(4) The Minister may accept an application even though it was not made in accordance with subsection (3).

Duties of Minister

(5) On receipt of an application, the Minister must, without delay, consider the application and grant or refuse it, and must notify the person of the decision in writing.

Date of objection if application granted

(6) If an application is granted, the notice of objection is deemed to have been filed on the day of the decision of the Minister.

Conditions — grant of application

(7) An application is not to be granted under this

section unless

(

a) the application is made within one year after the expiry of the time limited under this Act for objecting; and

(

b) the person demonstrates that

(

i) within the time limited under this Act for objecting, the person

(

A) was unable to act or to give a mandate to act in their name, or

(

B) had a bona fide intention to object to the assessment,

(ii)

given the reasons set out in the application and the circumstances of the case, it would be just and equitable to grant the application, and

(iii)

the application was made as soon as circumstances permitted it to be made.

DIVISION 7

Appeal

Extension of time by Tax Court of Canada

(1) A person that has made an application under

section 38 may apply to the Tax Court of Canada to have the application granted after either

(

a) the Minister has refused the application; or

(b)

90 days have elapsed after the day on which the application was made and the Minister has not notified the person of the Minister’s decision.

When application may not be made

(2) No application may be made after the expiry of 30 days after the day on which the decision referred to in subsection 38(5) is sent to the person.

How application made

(3) An application must be made by filing in the Registry of the Tax Court of Canada, in accordance with the Tax Court of Canada Act , three copies of the documents delivered or mailed under subsection 38 (3).

Copy to Commissioner

(4) The Tax Court of Canada must send a copy of the application to the Commissioner.

Powers of Tax Court of Canada

(5) The Tax Court of Canada may dispose of an application by dismissing or granting it and, in granting it, the Court may impose any terms that it considers just or order that the notice of objection be deemed to be a valid objection as of the date of the order.

When application to be granted

(6) An application must not be granted under this

section unless

(

a) the application under subsection 38 (1) was made within one year after the expiry of the time limited under this Act for objecting; and

(

b) the person demonstrates that

(

i) within the time limited under this Act for objecting, the person

(

A) was unable to act or to give a mandate to act in their name, or

(

B) had a bona fide intention to object to the assessment,

(ii)

given the reasons set out in the application under this

section and the circumstances of the case, it would be just and equitable to grant the application, and

(iii)

the application under subsection 38 (1) was made as soon as circumstances permitted it to be made.

Appeal to Tax Court of Canada

(1) Subject to subsection (2), a person that has filed a notice of objection to an assessment may appeal to the Tax Court of Canada to have the assessment vacated or a reassessment made after

(

a) the Minister has confirmed the assessment or has reassessed; or

(b)

180 days have elapsed after the day on which the notice of objection was filed and the Minister has not notified the person that the Minister has vacated or confirmed the assessment or has reassessed.

No appeal

(2) No appeal under subsection (1) may be instituted after the expiry of 90 days after the day on which notice that the Minister has reassessed or confirmed the assessment is sent to the person under subsection 37 (6).

Amendment of appeal

(3) The Tax Court of Canada may, on any terms that it sees fit, authorize a person that has instituted an appeal in respect of a matter to amend the appeal to include any further assessment in respect of the matter that the person is entitled under this

section to appeal.

Extension of time to appeal

(1) If no appeal to the Tax Court of Canada under

section 40 has been instituted within the time limited by that

section for doing so, a person may make an application to the Tax Court of Canada for an order extending the time within which an appeal may be instituted, and the Court may make an order extending the time for appealing and may impose any terms that it considers just.

Contents of application

(2) An application must set out the reasons why the appeal was not instituted within the time limited under

section 40 for doing so.

How application made

(3) An application must be made by filing in the Registry of the Tax Court of Canada, in accordance with the Tax Court of Canada Act , three copies of the application together with three copies of the notice of appeal.

Copy to Deputy Attorney General of Canada

(4) The Tax Court of Canada must send a copy of the application to the office of the Deputy Attorney General of Canada.

When order to be made

(5) An order must not be made under this

section unless

(

a) the application is made within one year after the expiry of the time limited under

section 40 for appealing; and

(

b) the person demonstrates that

(

i) within the time limited under

section 40 for appealing, the person

(

A) was unable to act or to give a mandate to act in their name, or

(

B) had a bona fide intention to appeal,

(ii)

given the reasons set out in the application and the circumstances of the case, it would be just and equitable to grant the application,

(iii)

the application was made as soon as circumstances permitted it to be made, and

(iv)

there are reasonable grounds for the appeal.

No appeal if waiver

Despite

section 40 , a person may not appeal to the Tax Court of Canada to have an assessment vacated or varied in respect of an issue for which the right of objection or appeal has been waived in writing by the person.

Institution of appeals

An appeal to the Tax Court of Canada under this Act must be instituted in accordance with the Tax Court of Canada Act .

Disposition of appeal

The Tax Court of Canada may dispose of an appeal from an assessment by

(

a) dismissing it; or

(

b) allowing it and

(

i) vacating the assessment, or

(ii)

referring the assessment back to the Minister for reconsideration and reassessment.

References to Tax Court of Canada

(1) If the Minister and another person agree in writing that a question arising under this Act, in respect of any assessment or proposed assessment of the person, should be determined by the Tax Court of Canada, that question must be determined by that Court.

Time during consideration not to count

(2) For the purpose of making an assessment of a person that agreed in writing to the determination of a question, filing a notice of objection to an assessment or instituting an appeal from an assessment, the time between the day on which proceedings are instituted in the Tax Court of Canada to have a question determined and the day on which the question is finally determined must not be counted in the computation of

(

a) the four-year period referred to in subsection 36 (1);

(

b) the period within which a notice of objection to an assessment may be filed under

section 37 ; or

(

c) the period within which an appeal may be instituted under

section 40 .

Reference of common questions to Tax Court of Canada

(1) If the Minister is of the opinion that a question arising out of one and the same transaction or occurrence or series of transactions or occurrences is common to assessments or proposed assessments in respect of two or more persons, the Minister may apply to the Tax Court of Canada for a determination of the question.

Contents of application

(2) An application must set out

(

a) the question in respect of which the Minister requests a determination;

(

b) the names of the persons that the Minister seeks to have bound by the determination; and

(

c) the facts and reasons on which the Minister relies and on which the Minister based or intends to base assessments of each person named in the application.

Service

(3) A copy of the application must be served by the Minister on each of the persons named in it and on any other person that, in the opinion of the Tax Court of Canada, is likely to be affected by the determination of the question.

Determination by Tax Court of Canada

(4) If the Tax Court of Canada is satisfied that a determination of a question set out in an application will affect assessments or proposed assessments in respect of two or more persons that have been served with a copy of the application and that are named in an order of the Tax Court of Canada under this subsection, it may

(

a) if none of the persons named in the order has appealed from such an assessment, proceed to determine the question in any manner that it considers appropriate; or

(

b) if one or more of the persons named in the order has or have appealed, make any order that it considers appropriate joining a party or parties to that appeal or those appeals and proceed to determine the question.

Determination final and conclusive

(5) Subject to subsection (6), if a question set out in an application is determined by the Tax Court of Canada, the determination is final and conclusive for the purposes of any assessments of persons named by the Court under subsection (4).

Appeal

(6) If a question set out in an application is determined by the Tax Court of Canada, the Minister or any of the persons that have been served with a copy of the application and that are named in an order of the Court under subsection (4) may, in accordance with the provisions of this Act, the Tax Court of Canada Act or the Federal Courts Act , as they relate to appeals from or applications for judicial review of decisions of the Tax Court of Canada, appeal from the determination.

Parties to appeal

(7) The parties that are bound by a determination are parties to any appeal from the determination.

Time during consideration not counted

(8) For the purpose of making an assessment of a person, filing a notice of objection to an assessment or instituting an appeal from an assessment, the periods described in subsection (9) must not be counted in the computation of

(

a) the four-year period referred to in subsection 36 (1);

(

b) the period within which a notice of objection to an assessment may be filed under

section 37 ; or

(

c) the period within which an appeal may be instituted under

section 40 .

Excluded periods

(9) The period that is not to be counted in the computation of the periods described in paragraphs (8)(

a) to (

c) is the time between the day on which an application that is made under this

section is served on a person under subsection (3) and

(

a) in the case of a person named in an order of the Tax Court of Canada under subsection (4), the day on which the determination becomes final and conclusive and not subject to any appeal; and

(

b) in the case of any other person, the day on which the person is served with a notice that the person has not been named in an order of the Tax Court of Canada under subsection (4).

DIVISION 8

Penalties

Failure to file

(1) Every person that fails to file a return as and when required under

section 7 is liable to a penalty equal to the greater of

(a)

$5,000 if the person is an individual or $10,000 if the person is not an individual, and

(

b) the amount that is the total of

(i)

5% of the tax calculated under

section 6 payable by the person in respect of the residential property for the calendar year, and

(ii)

the product obtained when 3% of the tax calculated under

section 6 payable by the person in respect of the residential property for the calendar year is multiplied by the number of complete months from the date on which the return was required to be filed.

Failure to file

(2) If a person fails to file a return in respect of a residential property for a particular calendar year by December 31 of the following calendar year, for the purpose of calculating the total referred to paragraph (1)(b), the tax calculated under

section 6 in respect of the residential property for the particular calendar year is to be determined without reference to paragraphs 6 (7)(

c) to (

f) and subsections 6 (8) and (9).

Waiving or cancelling penalties

(1) The Minister may, on or before the day that is 10 calendar years after the end of a calendar year of a person, or on application by the person on or before that day, waive or cancel all or any portion of any penalty under this Act payable by the person in respect of the calendar year.

Interest if amount waived or cancelled

(2) If a person has paid an amount of penalty and the Minister waives or cancels that amount under subsection (1), the Minister must pay interest on the amount paid by the person beginning on the day that is 30 days after the day on which the Minister received a request in a manner satisfactory to the Minister to apply that subsection and ending on the day on which the amount is paid to the person.

General penalty

Every person that fails to comply with any provision of this Act for which no other penalty is specified is liable to a penalty of $250.

Failure to file on demand

Every person that fails to file a return as and when required under a demand issued under

section 10 is liable to a penalty of $500.

Failure to provide information

Every person that fails to provide any information or record as and when required under this Act is liable to a penalty of $250 for every failure unless, in the case of information required in respect of another person, a reasonable effort was made by the person to obtain the information.

False statements or omissions

Every person that knowingly, or under circumstances amounting to gross negligence, makes or participates in, assents to or acquiesces in the making of a false statement or omission in a return, application, form, certificate, statement, invoice or answer (each of which is in this

section referred to as a “return”) is liable to a penalty of the greater of $500 and 25% of the total of

(

a) if the false statement or omission is relevant to the determination of an amount payable under this Act by the person, the amount, if any, by which

(

i) the amount payable

exceeds

(ii)

the amount that would be payable by the person if the amount payable were determined on the basis of the information provided in the return, and

(

b) if the false statement or omission is relevant to the determination of an amount that may be obtained under this Act, the amount, if any, by which

(

i) the amount that would be the amount payable to the person if the amount were determined on the basis of the information provided in the return

exceeds

(ii)

the amount payable to the person.

DIVISION 9

Offences and Punishment

Offence for failure to file return or to comply with demand or order

(1) Every person that fails to file or make a return as and when required under this Act or that fails to comply with an obligation under subsection 29 (6) or (9) or

section 31 , or an order made under

section 58 , is guilty of an offence and, in addition to any penalty otherwise provided, is liable on

summary conviction to