Bill S-212
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1st Session, 39th Parliament,
55 Elizabeth II, 2006
senate of canada
BILL S-212
An Act to amend the Income Tax Act (tax relief)
Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:
R.S., c. 1
(5th Supp.)
INCOME TAX ACT
1. (1) Subsection 117(2) of the Income Tax Act is replaced by the following:
Rates for years after 2004
(2) The tax payable under this Part by an individual on the individual’s taxable income or taxable income earned in Canada, as the case may be, (in this subdivision referred to as the “amount taxable”) for a taxation year is
(a) 15% of the amount taxable, if the amount taxable does not exceed $35,595;
(b) $5,339 plus 22% of the amount by which the amount taxable exceeds $35,595, if the amount taxable exceeds $35,595 and does not exceed $71,190;
(c) $13,170 plus 26% of the amount by which the amount taxable exceeds $71,190, if the amount taxable exceeds $71,190 and does not exceed $115,739; and
(d) $24,753 plus 29% of the amount by which the amount taxable exceeds $115,739, if the amount taxable exceeds $115,739.
(2) Subsection (1) applies to the 2005 and subsequent taxation years.
2. (1) The portion of subsection 118(3.1) of the Act before paragraph (c) is replaced by the following:
Additions to personal credits — basic personal amount
(3.1) The amount of $7,131 referred to in paragraphs (a) to (c) of the description of B in subsection (1) (in this subsection referred to as the “particular amount”) that is to be used for the purpose of determining the amount of that description is
(a) for the 2005 taxation year, to be replaced by the amount that is the total of $500 and the amount that would be determined for that description for that taxation year in respect of the particular amount if this section were read without reference to this subsection and section 117.1 were read without reference to subsection 117.1(3);
(a.1) for the 2006 taxation year, to be replaced by the amount that is the total of $200 and the amount that would be determined for that description for that taxation year in respect of the particular amount by applying section 117.1 (without reference to subsection 117.1(3)) to the amount determined under paragraph (a);
(b) for the 2007 taxation year, to be replaced by the amount that is the total of $100 and the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a.1);
(2) The portion of subsection 118(3.2) of the Act before paragraph (c) is replaced by the following:
Additions to personal credits — spouse or common-law partner or wholly dependent person
(3.2) The amount of $6,055 referred to in subparagraphs (a)(ii) and (b)(iv) of the description of B in subsection (1) (in this subsection referred to as the “particular amount”) that is to be used for the purpose of determining the amount of that description is
(a) for the 2005 taxation year, to be replaced by the amount that is the total of $425 and the amount that would be determined for that description for that taxation year in respect of the particular amount if this section were read without reference to this subsection and section 117.1 were read without reference to subsection 117.1(3);
(a.1) for the 2006 taxation year, to be replaced by the amount that is the total of $170 and the amount that would be determined for that description for that taxation year in respect of the particular amount by applying section 117.1 (without reference to subsection 117.1(3)) to the amount determined under paragraph (a);
(b) for the 2007 taxation year, to be replaced by the amount that is the total of $85 and the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a.1);
(3) The portion of subsection 118(3.3) of the Act before paragraph (c) is replaced by the following:
Additions to personal credits — net income threshold
(3.3) The amount of $606 referred to in subparagraphs (a)(ii) and (b)(iv) of the description of B in subsection (1) (in this subsection referred to as the “particular amount”) that is to be used for the purpose of determining the amount of that description is
(a) for the 2005 taxation year, to be replaced by the amount that is the total of $42.50 and the amount that would be determined for that description for that taxation year in respect of the particular amount if this section were read without reference to this subsection and section 117.1 were read without reference to subsection 117.1(3);
(a.1) for the 2006 taxation year, to be replaced by the amount that is the total of $17 and the amount that would be determined for that description for that taxation year in respect of the particular amount by applying section 117.1 (without reference to subsection 117.1(3)) to the amount determined under paragraph (a);
(b) for the 2007 taxation year, to be replaced by the amount that is the total of $8.50 and the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a.1);
(4) Section 118 of the Act is amended by adding the following after subsection (8):
Rounding
(9) If an amount determined under any of paragraphs (3.1)(a) and (a.1), (3.2)(a) and (a.1) and (3.3)(a) and (a.1) is not a multiple of one dollar, it shall be rounded to the nearest multiple of one dollar or, where it is equidistant from two such consecutive multiples, to the greater multiple.
(5) Subsections (1) to (4) apply to the 2005 and subsequent taxation years.
3. (1) Paragraph (a) of the description of A in subsection 122.51(2) of the Act is replaced by the following:
(a) $1,000, and
(2) Paragraph (b) of the description of B in subsection 122.51(2) of the Act is replaced by the following:
(b) $21,663.
(3) Subsection (1) applies to the 2006 and subsequent taxation years.
(4) Subsection (2) applies to the 2005 and subsequent taxation years.
4. (1) The portion of the description of N in subsection 122.61(1) of the Act before paragraph (a) is replaced by the following:
N is the product obtained by multiplying $2,300 by the number
of qualified dependants in respect of whom both
(2) Subsection (1) applies in respect of overpayments deemed to arise during months that are after June 2006.
Published under authority of the Senate of Canada
Explanatory Notes
Income Tax Act
Clause 1: (1) Existing text of subsection 117(2):
(2) The tax payable under this Part by an individual on the individual’s taxable income or taxable income earned in Canada, as the case may be, (in this subdivision referred to as the “amount taxable”) for a taxation year is
(a) 16% of the amount taxable, if the amount taxable does not exceed $30,754;
(b) $4,921 plus 22% of the amount by which the amount taxable exceeds $30,754, if the amount taxable exceeds $30,754 and does not exceed $61,509;
(b.1) $11,687 plus 26% of the amount by which the amount taxable exceeds $61,509, if the amount taxable exceeds $61,509 and does not exceed $100,000; and
(c) $21,695 plus 29% of the amount by which the amount taxable exceeds $100,000, if the amount taxable exceeds $100,000.
Clause 2: (1) Relevant portion of subsection 118(3.1):
(3.1) The amount of $7,131 referred to in paragraphs (a) to (c) of the description of B in subsection (1) (in this subsection referred to as the “particular amount”) that is to be used for the purpose of determining the amount of that description is
(a) for the 2006 taxation year, to be replaced by the amount that is the total of $100 and the amount that would be determined for that description for that year in respect of the particular amount if this section were read without reference to this subsection;
(b) for the 2007 taxation year, to be replaced by the amount that is the total of $100 and the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a);
(2) Relevant portion of subsection 118(3.2):
(3.2) The amount of $6,055 referred to in subparagraphs (a)(ii) and (b)(iv) of the description of B in subsection (1) (in this subsection referred to as the “particular amount”) that is to be used for the purpose of determining the amount of that description is
(a) for the 2006 taxation year, to be replaced by the amount that is the total of $85 and the amount that would be determined for that description for that year in respect of the particular amount if this section were read without reference to this subsection;
(b) for the 2007 taxation year, to be replaced by the amount that is the total of $85 and the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a);
(3) Relevant portion of subsection 118(3.3):
(3.3) The amount of $606 referred to in subparagraphs (a)(ii) and (b)(iv) of the description of B in subsection (1) (in this subsection referred to as the “particular amount”) that is to be used for the purpose of determining the amount of that description is
(a) for the 2006 taxation year, to be replaced by the amount that is the total of $8.50 and the amount that would be determined for that description for that year in respect of the particular amount if this section were read without reference to this subsection;
(b) for the 2007 taxation year, to be replaced by the amount that is the total of $8.50 and the amount that would be determined for that description for that year in respect of the particular amount by applying subsection 117.1(1) to the amount determined under paragraph (a);
(4) New.
Clause 3: Relevant portion of subsection 122.51(2):
(2) Where a return of income (other than a return of income filed under subsection 70(2), paragraph 104(23)(d) or 128(2)(e) or subsection 150(4)) is filed in respect of an eligible individual for a particular taxation year that ends at the end of a calendar year, there is deemed to be paid at the end of the particular year on account of the individual’s tax payable under this Part for the particular year the amount determined by the formula
A - B
where
A is the lesser of
(a) $750, and
(b) the total of
(i) 25/16 of the total of all amounts each of which is the amount determined by the formula in subsection 118.2(1) for the purpose of computing the individual’s tax payable under this Part for a taxation year that ends in the calendar year, and
(ii) 25% of the total of all amounts each of which is the amount deductible under section 64 in computing the individual’s income payable for a taxation year that ends in the calendar year; and
B is 5% of the amount, if any, by which
(a) the total of all amounts each of which is the individual’s adjusted income for a taxation year that ends in the calendar year
exceeds
(b) the sum of
(i) the greatest total that may be determined in respect of an individual for the year under paragraph (a) of the description of B in subsection 118(1), and
(ii) the dollar amount used for the year in computing the amount that may be claimed under subsection 118.3(1) in respect of an individual who has attained the age of 18 years before the end of the year.
Clause 4: Relevant portion of subsection 122.61(1):
(1) Where a person and, where the Minister so demands, the person’s cohabiting spouse or common-law partner at the end of a taxation year have filed a return of income for the year, an overpayment on account of the person’s liability under this Part for the year is deemed to have arisen during a month in relation to which the year is the base taxation year, equal to the amount determined by the formula
. . .
N - [O × P)
where
N is the product obtained by multiplying $2,000 by the number of qualified dependants in respect of whom both