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Bill C-69

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First Session, Forty-fourth Parliament,

70-71 Elizabeth II – 1-2 Charles III, 2021-2022-2023-2024

HOUSE OF COMMONS OF CANADA

BILL C-69
An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024

FIRST READING, May 2, 2024

DEPUTY PRIME MINISTER AND MINISTER OF FINANCE

91190


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 budget tabled in Parliament on April 16, 2024”.

SUMMARY

Part 1 implements certain measures in respect of the Income Tax Act and the Income Tax Regulations by

(a)denying income tax deductions for expenses incurred with respect to non-compliant short-term rentals;

(b)exempting from taxation the international shipping income of certain Canadian resident companies;

(c)exempting from taxation any income of the trusts established under the First Nations Child and Family Services, Jordan’s Principle, and Trout Class Settlement Agreement;

(d)doubling the volunteer firefighters and search and rescue volunteers tax credits;

(e)extending the eligibility for the Canada child benefit in respect of a child for six months after the child’s death;

(f)increasing the cap on labour expenditures per eligible newsroom employee from $55,000 to $85,000 and increasing, for four years, the Canadian journalism labour tax credit rate from 25% to 35%;

(g)extending eligibility for the mineral exploration tax credit by one year;

(h)providing a refundable tax credit to small and medium-sized businesses in designated provinces by returning a portion of fuel charge proceeds from the province;

(i)providing a refundable investment tax credit to qualifying businesses for investments in certain clean hydrogen projects;

(j)providing a refundable investment tax credit to qualifying businesses for certain investments in clean technology manufacturing property;

(k)amending the definition “government assistance” to exclude bona fide concessional loans with reasonable repayment terms from public authorities;

(l)implementing a number of amendments to the alternative minimum tax;

(m)increasing the home buyers’ plan withdrawal limit from $35,000 to $60,000 and deferring the repayment period by three additional years;

(n)excluding the failure to report under the mandatory disclosure rules from the application of the section 238 penalty;

(o)introducing a $10-million capital gains exemption on the sale of a business to an employee ownership trust; and

(p)implementing a number of technical amendments to correct inconsistencies and to better align the law with its intended policy objectives.

Part 2 enacts the Global Minimum Tax Act, a regime based on the rules of the Organisation for Economic Co-operation and Development (OECD). The global minimum tax regime will ensure that large multinational corporations are subject to a minimum effective tax rate of 15% on their profits wherever they do business. It sets out rules for the purposes of establishing liability for the tax and also sets out applicable reporting and filing requirements. To promote compliance with its provisions, that Act includes modern administration and enforcement provisions generally aligned with those found in other taxation statutes. Finally, this Part also makes related and consequential amendments to other texts to ensure proper implementation of the tax and cohesive and efficient administration by the Canada Revenue Agency.

Part 3 amends the Excise Tax Act, the Excise Act, the Excise Act, 2001, the Underused Housing Tax Act, the Greenhouse Gas Pollution Pricing Act and other related texts in order to implement certain measures.

Division 1 of Part 3 amends the Excise Tax Act by repealing the temporary relief for supplies of certain face masks or respirators and certain face shields from the Goods and Services Tax/Harmonized Sales Tax.

Division 2 of Part 3 amends the Excise Act, the Excise Act, 2001 and other related texts in order to implement changes to

(a)the federal excise duty framework for tobacco products by

(i)increasing the excise duty rates for tobacco products, including imposing a tax on inventories of cigarettes held by retailers and wholesalers,

(ii)changing the process by which brands of tobacco products for export are exempted from special excise duty and marking requirements,

(iii)allowing certain information to be shared for the administration or enforcement of the Tobacco and Vaping Products Act, and

(iv)requiring the filing of information returns in respect of tobacco excise stamps;

(b)the federal excise duty framework for vaping products by increasing the excise duty rates for vaping products; and

(c)the federal excise duty framework for alcohol by

(i)extending by two years the two per cent cap on the inflation adjustment on beer, spirits and wine excise duties, and

(ii)cutting by half for two years the excise duty rate on the first 15,000 hectolitres of beer brewed in Canada.

Division 3 of Part 3 amends the Underused Housing Tax Act and the Underused Housing Tax Regulations by, among other things,

(a)eliminating filing requirements for certain owners;

(b)reducing minimum penalties for failing to file a return; and

(c)introducing a new exemption for residential properties held as a place of residence or lodging for employees.

Division 4 of Part 3 amends the Greenhouse Gas Pollution Pricing Act by providing authority, in certain circumstances, for the sharing of certain information amongst federal officials and for the public disclosure of certain information by the Minister of National Revenue.

Part 4 enacts and amends several Acts in order to implement various measures.

Division 1 of Part 4 amends the Budget Implementation Act, 2022, No. 1 to delay the repeal of the Prohibition on the Purchase of Residential Property by Non-Canadians Act for two years.

Division 2 of Part 4 amends the National Housing Act to increase the in-force limits for guarantees issued by the Canada Mortgage and Housing Corporation (CMHC) in respect of mortgage-backed securities and Canada Mortgage Bonds and for mortgage default insurance provided by CMHC from the temporary $750 billion to the permanent $800 billion. It also amends the Borrowing Authority Act to avoid the double counting of liabilities related to Canada Mortgage Bonds that are guaranteed by the CMHC and have been purchased by the Minister of Finance, on behalf of the Government of Canada, in the calculation of the maximum amount of certain borrowings under that Act.

Division 3 of Part 4 authorizes the making of payments to the provinces for the fiscal year beginning on April 1, 2024 respecting a national program for providing food in schools.

Division 4 of Part 4 amends the Canada Student Loans Act and the Canada Student Financial Assistance Act to expand eligibility for student loan forgiveness to early childhood educators, dentists, dental hygienists, pharmacists, midwives, teachers, social workers, psychologists, personal support workers and physiotherapists.

Division 5 of Part 4 amends the Canada Education Savings Act to, among other things,

(a)authorize the Minister responsible for that Act to open a registered education savings plan in respect of a child born after 2023 who is eligible for the payment of the Canada Learning Bond and is not the beneficiary under such a plan, so that the Minister may pay a Canada Learning Bond in respect of the child; and

(b)increase, from 20 to 30 years, the maximum age of a beneficiary under a registered education savings plan in respect of whom a Canada Learning Bond may be paid on application.

It also makes consequential amendments to the Income Tax Act.

Division 6 of Part 4 amends the Bretton Woods and Related Agreements Act to increase the maximum financial assistance that may be provided in respect of foreign states.

Division 7 of Part 4 amends the Bretton Woods and Related Agreements Act to increase the amount of the payment that the Minister of Finance may provide to the International Monetary Fund in respect of Canada’s subscriptions. It also amends the International Development (Financial Institutions) Assistance Act and the European Bank for Reconstruction and Development Agreement Act to provide for new financial instruments that the Minister of Foreign Affairs or the Minister of Finance, as the case may be, may use to provide financial assistance to the institutions referred to in those Acts.

Division 8 of Part 4 amends the International Financial Assistance Act to, among other things, provide that foreign exchange losses in relation to programs referred to in that Act must be charged to the Consolidated Revenue Fund and provide for the making of payments to Development Finance Institute Canada (DFIC) Inc. in relation to programs referred to in that Act out of the Consolidated Revenue Fund.

Division 9 of Part 4 amends the Export Development Act to lower the limit for total liabilities and obligations referred to in subsection 24(1) of that Act from $115 billion to $100 billion.

Division 10 of Part 4 amends the Financial Administration Act to broaden the application of subsection 85(2) of that Act to other Crown corporations.

Division 11 of Part 4 amends the Financial Administration Act to require certain banks and other financial institutions to disclose prescribed information for federal payments accepted for deposit.

Division 12 of Part 4 amends the Federal-Provincial Fiscal Arrangements Act to enhance the Canada Health Transfer for qualifying provinces and territories.

Division 13 of Part 4 amends the Pension Benefits Standards Act, 1985 to require that the Superintendent of Financial Institutions publish certain information relating to pension plan investments. It also amends the Pooled Registered Pension Plans Act to require that plan administrators provide specified information by written notice to certain persons when they become members of a pooled registered pension plan.

Division 14 of Part 4 amends the Canada Pension Plan to, among other things,

(a)provide for a death benefit of $5,000 in cases where no other Canada Pension Plan benefit, with the exception of the orphan’s benefit, has been paid in respect of the deceased contributor’s contributions;

(b)create a new child’s benefit for dependent children aged 18 to 24 who are in part-time attendance at school;

(c)maintain eligibility for the disabled contributor’s child’s benefit if the disabled contributor reaches the age of 65;

(d)allow for the deeming of an application for a disabled contributor’s child’s benefit on behalf of a child to have been made at an earlier date under the Canada Pension Plan’s incapacity provisions;

(e)preclude entitlement to a survivor’s pension if an individual has received a division of unadjusted pensionable earnings in respect of their deceased separated spouse; and

(f)clarify the determination of the payee of the disabled contributor’s child’s benefit.

It also makes a consequential amendment to the Canada Pension Plan Regulations.

Division 15 of Part 4 amends the Public Sector Pension Investment Board Act to provide for the payment of certain amounts into the Consolidated Revenue Fund by the Public Sector Pension Investment Board.

Division 16 of Part 4 enacts the Consumer-Driven Banking Act, which establishes a consumer-driven framework for individuals and small businesses to safely and securely share their data with the participating entities of their choice.

It also makes related amendments to the Financial Consumer Agency of Canada Act to establish the position of Senior Deputy Commissioner for Consumer-Driven Banking who is responsible for consumer-driven banking matters and to provide for, among other things, the supervision of participating entities.

Division 17 of Part 4 amends the Bank Act to, among other things, clarify the definitions “deposit-type instrument” and “principal-protected note”.

Division 18 of Part 4 amends the Office of the Superintendent of Financial Institutions Act to increase to $100,000,000 the maximum amount that expenditures made out of the Consolidated Revenue Fund to defray the expenses arising out of the operations of the Office may exceed the Office’s total assessments and revenues.

Division 19 of Part 4 amends the Bank of Canada Act to clarify that the Bank of Canada may enter into repurchase, reverse repurchase and buy-sellback agreements.

Division 20 of Part 4 amends the Canada Business Corporations Act to

(a)harmonize fines for a corporation guilty of an offence related to the collection or sending of information regarding individuals with significant control; and

(b)set separate fines and imprisonment terms on the basis of a summary conviction or a conviction on indictment for a director, officer or shareholder of a corporation guilty of an offence related to individuals with significant control.

Division 21 of Part 4 amends Parts I to III of the Canada Labour Code to, among other things,

(a)provide that a person who is paid remuneration by an employer is presumed to be their employee unless the contrary is proved by the employer;

(b)provide that if, in any proceeding other than a prosecution, an employer alleges that a person is not their employee, the burden of proof is on the employer; and

(c)prohibit an employer from treating an employee as if they were not their employee.

Finally, it also includes transitional provisions.

Division 22 of Part 4 amends the Canada Labour Code to, among other things, set out certain employer obligations relating to policies respecting work-related communication and clarify certain employee rights and employer obligations relating to terminations of employment. It also includes transitional provisions.

Division 23 of Part 4 amends the Employment Insurance Act to extend, until October 24, 2026, the duration of the measure that increases the maximum number of weeks for which benefits may be paid in a benefit period to certain seasonal workers.

Division 24 of Part 4 amends section 61 of An Act for the Substantive Equality of Canada’s Official Languages in order to add a reference to subsections 18(1.‍1) and (1.‍2) of the Use of French in Federally Regulated Private Businesses Act in subsection 19(1) of that Act, which An Act for the Substantive Equality of Canada’s Official Languages enacts.

Division 25 of Part 4 authorizes a corporation that is to be incorporated as a wholly owned subsidiary of the Canada Development Investment Corporation to provide loan guarantees as part of an Indigenous loan guarantee program and authorizes the payment out of the Consolidated Revenue Fund by the Minister of Finance of amounts that are required in respect of those guarantees.

Division 26 of Part 4 authorizes the payment of up to $1.‍3 million to entities or individuals involved in the government’s engagement in a pilot project for the creation of a Red Dress Alert.

Division 27 of Part 4 provides that the subsidiary of VIA Rail Canada Inc. incorporated with the corporate name VIA HFR - VIA TGF Inc. is, as of the date of its incorporation, an agent of His Majesty in right of Canada and may enter into contracts, agreements and other arrangements with His Majesty as though it were not such an agent.

Division 28 of Part 4 amends the Impact Assessment Act, in response to the majority opinion of the Supreme Court of Canada on the constitutionality of that Act, to, among other things,

(a)align the preamble and purpose provision with the primary objective of that Act, which is to prevent or mitigate significant adverse effects within federal jurisdiction — and significant direct or incidental adverse effects — that may be caused by the carrying out of physical activities;

(b)replace the definition “effects within federal jurisdiction” with “adverse effects within federal jurisdiction” and, in doing so,

(i)restrict the definition to non-negligible adverse changes,

(ii)limit transboundary changes to those involving the pollution of transboundary waters and the marine environment, and

(iii)include, in respect of federal works or undertakings and activities carried out on federal lands, non-negligible adverse changes to the environment or to health, social and economic conditions;

(c)ensure that the impact assessment process applies only to those physical activities that may cause adverse effects within federal jurisdiction or direct or incidental adverse effects;

(d)ensure that, in deciding if an impact assessment of a designated project is required, one factor that the Impact Assessment Agency of Canada must take into account is whether another means exists that would permit a jurisdiction to address those effects;

(e)amend the final decision-making provisions to provide for an initial determination as to whether the adverse effects within federal jurisdiction and the direct or incidental adverse effects are likely to be, to some extent, significant, and then, if so, provide for a determination as to whether those effects are justified in the public interest; and

(f)improve cooperation tools to better harmonize the impact assessment process with the processes for assessing effects that are followed by provincial and Indigenous jurisdictions.

Finally, it also includes transitional provisions.

Division 29 of Part 4 amends the Judges Act to increase the number of salaries authorized for judges of superior courts other than appeal courts. It also reduces in a corresponding manner the number of salaries authorized for judges of provincial unified family courts.

Division 30 of Part 4 amends the Tax Court of Canada Act to provide that, if a party to a proceeding under the general procedure of the Tax Court of Canada is not an individual, that party must be represented by counsel, except under special circumstances.

Division 31 of Part 4 amends the Food and Drugs Act to, among other things, authorize the Minister of Health to

(a)establish rules for the purpose of preventing, managing or controlling the risk of injury to health from the use of therapeutic products, other than the intended use, or the risk of adverse effects on human beings, animals or the environment from the use of a drug intended for an animal;

(b)exempt any food, therapeutic product, person or activity from the application of certain provisions of that Act or its regulations; and

(c)deem, on the basis of decisions of, information or documents produced by, a foreign regulatory authority, that certain requirements of that Act or its regulations are met in respect of a therapeutic product or food.

Finally, it also includes a transitional provision.

Division 32 of Part 4 amends the Tobacco and Vaping Products Act to authorize the provision of customs information to the Minister responsible for that Act for the purpose of the administration and enforcement of that Act and to authorize that Minister to disclose information to other federal ministers for certain purposes.

Division 33 of Part 4 amends the Criminal Code to broaden the criminal interest rate offence to prohibit a person from offering to enter into an agreement or arrangement to receive interest at a criminal rate and from advertising an offer to enter into an agreement or arrangement that provides for the receipt of interest at a criminal rate. It also repeals the provision that requires the consent of the Attorney General prior to commencing proceedings related to the offence.

Division 34 of Part 4 contains measures that are related to money laundering, terrorist financing and sanctions evasion and other measures.

Subdivision A of Division 34 amends the Proceeds of Crime (Money Laundering) and Terrorist Financing Act to, among other things,

(a)permit information sharing between reporting entities for the purpose of detecting and deterring money laundering, terrorist financing and sanctions evasion;

(b)authorize, subject to certain conditions, the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) to disclose certain information to provincial and territorial civil forfeiture offices and to the Department of Citizenship and Immigration;

(c)authorize FINTRAC to publicize additional information pertaining to violations of that Act; and

(d)extend the application of that Act to cheque cashing businesses.

It also makes consequential amendments to the Personal Information Protection and Electronic Documents Act and the Cross-border Currency and Monetary Instruments Reporting Regulations.

Subdivision B of Division 34 amends the Income Tax Act and the Excise Tax Act to allow provincial or superior court judges, a judge of a superior court of criminal jurisdiction or a judge as defined in section 552 of the Criminal Code to grant on application by a Canada Revenue Agency official the authorization to use device or investigative technique, or procedure or otherwise do any thing provided in a warrant, for purposes of tax investigations.

Subdivision C of Division 34 amends the Criminal Code to provide for an order to keep an account open or active and for a production order to require the production of documents or data that are in a person’s possession or control on dates specified in an order that fall within the 60-day period after the day on which it is made.

Division 35 of Part 4 amends the Criminal Code to, among other things,

(a)create new offences in respect of motor vehicle theft, including an offence concerning the possession or the distribution of an electronic device suitable for committing theft of a motor vehicle, and in respect of criminal organizations; and

(b)add, as an aggravating factor, evidence that an offender involved a person under the age of 18 years in the commission of an offence.

It also makes consequential amendments to other Acts.

Division 36 of Part 4 amends the Radiocommunication Act to, among other things, prohibit the manufacture, import, distribution, lease, offer for sale, sale or possession of certain devices specified by the Minister of Industry. It also amends that Act to establish as an offence or a violation the contravention of that prohibition.

Division 37 of Part 4 amends the Telecommunications Act to, among other things, require telecommunications service providers to provide their subscribers with a self-service mechanism that allows them to cancel their contract for telecommunications services or modify their telecommunications service plan and to inform those subscribers before the expiry of their fixed-term contract, as well as in other specified circumstances, of other service plans that those providers offer. It also amends that Act to prohibit the charging of certain fees.

Division 38 of Part 4 amends the Immigration and Refugee Protection Act to, among other things,

(a)eliminate the designated countries of origin regime;

(b)expand the powers of the Minister of Citizenship and Immigration to specify the information and documents that are required in support of a claim for refugee protection;

(c)authorize the Refugee Protection Division of the Immigration and Refugee Board to determine that claims for refugee protection that have not yet been referred to the Refugee Protection Division have been abandoned in certain circumstances;

(d)provide the Minister of Citizenship and Immigration with the power to determine that claims for refugee protection that have not yet been referred to the Refugee Protection Division have been withdrawn in certain circumstances;

(e)require that certain refugee claimants be authorized to enter and remain in Canada until a final determination is made in respect of their claim;

(f)authorize regulations to be made setting out conditions that must be imposed on refugee claimants who are authorized to enter and remain in Canada;

(g)provide for the deemed inadmissibility of foreign nationals whose refugee claims are rejected or determined to be abandoned or withdrawn and for the automatic making of removal orders in those circumstances;

(h)require the Refugee Protection Division and the Refugee Appeal Division to suspend certain proceedings respecting a claim for refugee protection if the claimant is not present in Canada;

(i)clarify that decisions of the Immigration and Refugee Board must be rendered, and reasons for those decisions must be given, in the manner specified by its Chairperson; and

(j)provide the Minister of Citizenship and Immigration and the Minister of Public Safety and Emergency Preparedness with the power to designate, in relation to certain proceedings or applications, a representative for persons who are under 18 years of age or who are unable to appreciate the nature of the proceeding or application.

Finally, it also includes transitional provisions.

Division 39 of Part 4 amends the Corrections and Conditional Release Act to, among other things,

(a)provide that the Correctional Service of Canada is responsible for implementing any arrangement — approved by the Minister of Public Safety and Emergency Preparedness — entered into by the Commissioner of Corrections and the Canada Border Services Agency with respect to the support that the Service may provide to the Agency to assist in the exercise of certain powers or the performance of certain duties and functions;

(b)control the access of the inmates of a penitentiary to a designated immigrant station adjacent to the penitentiary and the access of the immigration detainees of a designated immigrant station to a penitentiary adjacent to the station; and

(c)provide that, in exigent circumstances, staff members of the Service may provide additional support to detention enforcement officers of the Agency to assist them in the exercise of certain powers or the performance of certain duties and functions.

It also amends the Immigration and Refugee Protection Act to define the term “immigrant station” and provide that an area of a penitentiary may be an immigrant station only if it is designated under the Corrections and Conditional Release Act.

Finally, it provides for the repeal of those amendments on a specified date and includes a transitional provision.

Division 40 of Part 4 contains measures related to public debt and the borrowing of money.

Subdivision A of Division 40 amends the Financial Administration Act to clarify that certain regulations and directions do not apply to contracts related to the borrowing of money entered into by the Minister of Finance.

Subdivision B of Division 40 amends the Borrowing Authority Act to increase the maximum amount of certain borrowings.

Division 41 of Part 4 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to require certain financial institutions to make available information respecting diversity among directors and members of senior management.

Division 42 of Part 4 amends the Trust and Loan Companies Act, the Bank Act and the Insurance Companies Act to extend the period during which federal financial institutions governed by those Acts may carry on business.

Division 43 of Part 4 amends the Federal Courts Act to provide that the Federal Court has jurisdiction to hear applications for judicial review of decisions of the Social Security Tribunal on the extension of time to make a request for review or reconsideration under the Canada Disability Benefit Act. It also amends the Tax Court of Canada Act and the Department of Employment and Social Development Act to, among other things, provide the Tribunal with jurisdiction to hear appeals of decisions made under the Canada Disability Benefit Act and require that matters related to income raised in those appeals be referred to the Tax Court of Canada.

Division 44 of Part 4 amends the Controlled Drugs and Substances Act to repeal provisions related to the ministerial power to exempt supervised consumption sites from the application of that Act. It also amends that Act to allow for the making of regulations respecting authorizations for supervised consumption and drug checking services and includes transitional provisions.

Available on the House of Commons website at the following address:
www.ourcommons.ca


TABLE OF PROVISIONS

An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024
Short Title
1

Budget Implementation Act, 2024, No. 1

PART 1
Amendments to the Income Tax Act and Other Legislation
2
PART 2
Global Minimum Tax Act
81

Enactment

An Act respecting a global minimum tax
Short Title
1

Global Minimum Tax Act

PART 1
Interpretation and Application
Interpretation
2

Definitions

3

Interpretation

4

Binding on His Majesty

5

Location of entities

6

Dual-located entity — tie-breaker rule

Application
7

Currency conversion — GloBE calculations

8

Negative amounts

Scope
9

Definition of qualifying MNE group

10

Definition of MNE group

11

Definition of constituent entity

12

Definition of ultimate parent entity

13

Definition of excluded entity

PART 2
Global Minimum Tax
DIVISION 1
Liability for Tax
14

Top-up tax liability

15

Top-up tax payable

DIVISION 2
Computation of GloBE Income or Loss
GloBE Income or Loss
16

Definition of GloBE income or loss

SUBDIVISION A 
Determination of Financial Accounting Income
17

Definition of financial accounting income

SUBDIVISION B 
Adjustments in Computing GloBE Income or Loss
18

Net tax expense

SUBDIVISION C 
International Shipping Net Income or Loss Exclusion
19

Exclusion of international shipping net income or loss

SUBDIVISION D 
Ultimate Parent Entities Subject to Tax Transparency or Deductible Dividend Regimes
20

GloBE income — flow-through ultimate parent entity

21

GloBE income — deductible dividend regime

DIVISION 3
Computation of Adjusted Covered Taxes
SUBDIVISION A 
Adjusted Covered Taxes
22

Definition of adjusted covered taxes

23

Definition of covered taxes

SUBDIVISION B 
Allocation of Covered Taxes
24

Allocation of covered taxes to a permanent establishment

SUBDIVISION C 
Total Deferred Tax Adjustment Amount
25

Definition of total deferred tax adjustment amount

SUBDIVISION D 
GloBE Loss Election
26

GloBE loss deferred tax asset

SUBDIVISION E 
Post-Filing Adjustments and Tax Rate Changes
27

Adjustments to covered taxes for a prior year

SUBDIVISION F 
Qualified Flow-Through Tax Benefits
28

Definitions

DIVISION 4
Computation of Effective Tax Rate and Top-up Amount
SUBDIVISION A 
Effective Tax Rate
29

Definition of effective tax rate

SUBDIVISION B 
Top-up Amount of a Standard Constituent Entity
30

Definition of top-up amount

31

Adjustment top-up amount

SUBDIVISION C 
Substance-based Income Exclusion
32

Definition of substance-based income exclusion amount

SUBDIVISION D 
De Minimis Jurisdiction Exclusion
33

De minimis jurisdiction exclusion

SUBDIVISION E 
Top-up Amount of a Minority-Owned Constituent Entity
34

Deeming rule — minority-owned subgroup

SUBDIVISION F 
Top-up Amount of a Joint Venture Entity
35

Joint venture top-up amount

SUBDIVISION G 
Top-up Amount of an Investment Entity
36

Definitions

SUBDIVISION H 
Eligible Distribution Tax Systems
37

Deemed distribution tax — rules

DIVISION 5
Reorganizations and Asset Transfers
38

Constituent entities joining and leaving MNE group

39

Acquisitions and dispositions of assets and liabilities — no GloBE reorganization

DIVISION 6
Multi-Parented MNE Groups
40

Multi-parented MNE group rules

DIVISION 7
Elections in Relation to Investment Entities
SUBDIVISION A 
Tax Transparency Election
41

Investment entity tax transparency election

SUBDIVISION B 
Taxable Distribution Method Election
42

Definitions

DIVISION 8
Safe Harbours
SUBDIVISION A 
Permanent Safe Harbours
43

Definitions

44

Qualified domestic minimum top-up tax safe harbour

45

Simplified calculations safe harbour

46

Non-material constituent entities

SUBDIVISION B 
Transitional Safe Harbours
47

Definitions — transitional CbCR safe harbour

DIVISION 9
Transition Rules
SUBDIVISION A 
Tax Attributes on Transition
48

Transition — deferred tax assets and liabilities

SUBDIVISION B 
Transitional Rates for the Substance-based Income Exclusion
49

Transitional rates for the substance-based income exclusion

PART 3
Domestic Minimum Top-up Tax
50

Interpretation

51

Domestic minimum top-up tax

52

Definition of domestic top-up amount

53

Definitions — initial phase of international activity

PART 4
Anti-Avoidance
54

General anti-avoidance rule

PART 5
General Provisions, Administration and Enforcement
Definitions
55

Definitions

DIVISION 1
Duties of Minister
56

Minister’s duty

57

Staff

58

Administration of oaths

59

Waiving filing of documents

DIVISION 2
Returns
60

GIR filing obligation

61

Part 2 return

62

Demand for return

63

Trustees, etc.

DIVISION 3
Payments
64

Payments

65

Manner and form of payments

66

Part 2 — assessment of another constituent entity

67

Definition of transaction

68

Payment in Canadian dollars

69

Definition of electronic payment

70

Small amounts owing by a person

DIVISION 4
Interest
71

Compound interest

72

Waiving or cancelling interest

DIVISION 5
Administrative Charge Under the Financial Administration Act
73

Dishonoured instruments

DIVISION 6
Refunds
74

Statutory recovery rights

75

Refund — payment in error

76

Restriction — application to other debts

77

Restriction — unfulfilled filing requirements

78

Restriction — trustees

79

Overpayment of refund or interest

DIVISION 7
Records and Information
80

Keeping records

81

Requirement to provide information or records

DIVISION 8
Assessments
82

Assessment

83

Notice of assessment

84

Payment by Minister on assessment

85

Limitation period for assessments

86

Assessment deemed valid and binding

DIVISION 9
Objections to Assessment
87

Objections to assessment

88

Extension of time by Minister

DIVISION 10
Appeal
89

Extension of time by Tax Court of Canada

90

Appeal to Tax Court of Canada

91

Extension of time to appeal

92

Limitation on appeals

93

Institution of appeals

94

Disposition of appeal

95

References to Tax Court of Canada

96

Reference of common questions to Tax Court

97

Payment by Minister on appeal

DIVISION 11
Penalties
98

Failure to file GIR

99

Failure to file return under section 61

100

Failure to provide information

101

Unreasonable appeal

102

Definitions

103

General penalty

104

Payment of penalties

105

Waiving or cancelling penalties

DIVISION 12
Offences and Punishment
106

Failure to file or comply

107

Offences for false or deceptive statement

108

Failure to pay tax

109

Offence — confidential information

110

General offence

111

Defence of due diligence

112

Compliance orders

113

Officers of corporations, etc.

114

Power to decrease punishment

115

Information or complaint

DIVISION 13
Inspections
116

Authorized person

117

Compliance order

118

Search warrants

119

Definition of foreign-based information or record

120

Inquiry

121

Copies

122

Compliance

DIVISION 14
Confidentiality of Information
123

Definitions

DIVISION 15
Collection
124

Definitions

125

Collection restrictions

126

Security

127

Certificates

128

Garnishment

129

Recovery by deduction or set-off

130

Acquisition of debtor’s property

131

Money seized from debtor

132

Seizure if failure to pay

133

Person leaving Canada

134

Authorization to proceed without delay

DIVISION 16
Evidence and Procedure
135

Service

136

Timing of receipt

137

Proof of sending or service by mail

PART 6
Regulations
138

Regulations

139

Positive or negative amount — regulations

140

Incorporation by reference — limitation removed

141

Certificates not statutory instruments

PART 3
Amendments to the Excise Tax Act, the Excise Act, the Excise Act, 2001, the Underused Housing Tax Act, the Greenhouse Gas Pollution Pricing Act and Other Related Texts
DIVISION 1
Excise Tax Act (GST/HST)
112
DIVISION 2
Excise Act, Excise Act, 2001 and Other Related Texts (Alcohol, Tobacco and Vaping Products)
113
DIVISION 3
Underused Housing Tax Act and Underused Housing Tax Regulations
136
DIVISION 4
Greenhouse Gas Pollution Pricing Act (Part 1)
147
PART 4
Various Measures
DIVISION 1
Budget Implementation Act, 2022, No. 1 (Extension of Prohibition on Purchase of Residential Property by Non-Canadians)
149
DIVISION 2
Canada Mortgage Bonds Program
150
DIVISION 3
National School Food Program
154
DIVISION 4
Student Loan Forgiveness
155
DIVISION 5
Canada Education Savings Act
162
DIVISION 6
Bretton Woods and Related Agreements Act
172
DIVISION 7
Measures Relating to Modernizing International Financial Institutions
173
DIVISION 8
International Financial Assistance Act
176
DIVISION 9
Export Development Act
178
DIVISION 10
Financial Administration Act (Exemption Related to Certain Crown Corporations)
179
DIVISION 11
Financial Administration Act (Information Disclosure Requirements)
180
DIVISION 12
Federal-Provincial Fiscal Arrangements Act
182
DIVISION 13
Private Sector Pension Plans
184
DIVISION 14
Canada Pension Plan
187
DIVISION 15
Public Sector Pension Investment Board Act
197
DIVISION 16
Consumer-Driven Banking Framework
198

Consumer-Driven Banking Act

An Act to establish a consumer-driven banking framework
Short Title
1

Consumer-Driven Banking Act

Interpretation
2

Definitions

Purpose
3

Purpose

Application
4

Data

5

Limit — editing data

6

Restriction

Registry
7

Participating entities

Technical Standards
8

Designation of body

9

Review

10

Revocation

11

Statutory Instruments Act

12

Annual report

13

Change that has significant impact

Prohibitions
14

Claiming to be participating entity

15

False or misleading information

Offences and Punishment
16

Offence and punishment

17

Order to comply

18

Party to offence

19

Limitation period

Regulations
20

Regulations

Coming into Force
21

Order in council

DIVISION 17
Bank Act
228
DIVISION 18
Office of the Superintendent of Financial Institutions Act
230
DIVISION 19
Bank of Canada Act
231
DIVISION 20
Canada Business Corporations Act
232
DIVISION 21
Canada Labour Code (Improving Access to Protections for Employees)
235
DIVISION 22
Canada Labour Code (Policy on Disconnecting and Other Measures)
245
DIVISION 23
Employment Insurance Act
259
DIVISION 24
An Act for the Substantive Equality of Canada’s Official Languages
260
DIVISION 25
Indigenous Loan Guarantee Program
261
DIVISION 26
Red Dress Alert
264
DIVISION 27
Subsidiary of VIA Rail Canada Inc.
265
DIVISION 28
Impact Assessment Act
269
DIVISION 29
Judges Act
320
DIVISION 30
Tax Court of Canada Act
321
DIVISION 31
Food and Drugs Act
322
DIVISION 32
Tobacco and Vaping Products Act
334
DIVISION 33
Criminal Code (Criminal Interest Rate)
336
DIVISION 34
Money Laundering, Terrorist Financing, Sanctions Evasion and Other Measures
340
DIVISION 35
Criminal Code (Motor Vehicle Theft)
368
DIVISION 36
Radiocommunication Act
380
DIVISION 37
Telecommunications Act
383
DIVISION 38
Immigration and Refugee Protection Act (In-Canada Asylum System)
385
DIVISION 39
Immigrant Stations
433
DIVISION 40
Measures Related to Public Debt and the Borrowing of Money
442
DIVISION 41
Legislation Related to Financial Institutions (Diversity Disclosure)
445
DIVISION 42
Legislation Related to Financial Institutions (Sunset Provisions)
451
DIVISION 43
Measures Related to the Canada Disability Benefit
456
DIVISION 44
Controlled Drugs and Substances Act
461


1st Session, 44th Parliament,

70-71 Elizabeth II – 1-2 Charles III, 2021-2022-2023-2024

HOUSE OF COMMONS OF CANADA

BILL C-69

An Act to implement certain provisions of the budget tabled in Parliament on April 16, 2024

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

Short Title

Short title

1This Act may be cited as the Budget Implementation Act, 2024, No. 1.

PART 1
Amendments to the Income Tax Act and Other Legislation

R.‍S.‍, c. 1 (5th Supp.‍)

Income Tax Act

2(1)The description of B in subsection 6(2) of the French version of the Income Tax Act is replaced by the following:

Start of inserted block

B
le produit obtenu en multipliant 1 667 par le quotient obtenu en divisant le nombre total de jours ci-dessus par 30, si le quotient ainsi obtenu n’est pas un nombre entier et qu’il est supérieur à un, en l’arrondissant au nombre entier le plus proche ou, si ce quotient est équidistant de deux nombres entiers consécutifs, en l’arrondissant au plus petit de ces deux nombres;

End of inserted block

(2)The description of D in subsection 6(2) of the French version of the Act is replaced by the following:

Start of inserted block

D
le nombre obtenu en divisant par 30 le nombre total de jours ci-dessus où l’employeur est propriétaire de l’automobile, si le quotient ainsi obtenu n’est pas un nombre entier et qu’il est supérieur à un, en l’arrondissant au nombre entier le plus proche ou, si ce quotient est équidistant de deux nombres entiers consécutifs, en l’arrondissant au plus petit de ces deux nombres;

End of inserted block

3(1)Subsection 7(1.‍11) of the Act is replaced by the following:

Non-arm’s length relationship with trusts
(1.‍11)For the purposes of this section, a mutual fund trust is deemed not to deal at arm’s length with a corporation only if
  • Insertion start (a) Insertion end the trust controls the corporation; Insertion start or Insertion end

  • Start of inserted block

    (b)the corporation holds securities that give the corporation not less than 50% of the votes that could be cast at a meeting of the unitholders of the trust.

    End of inserted block

(2)The portion of subsection 7(1.‍31) of the Act before paragraph (a) is replaced by the following:

Disposition of newly acquired security
(1.‍31)Where a taxpayer acquires at a particular time a particular security under an agreement referred to in subsection (1) — Insertion start or acquires the particular security as consideration for the disposition of rights under the agreement Insertion end — and, on a day that is no later than 30 days after the day that includes the particular time, the taxpayer disposes of a security that is identical to the particular security, the particular security is deemed to be the security that is so disposed of if

(3)Subsection (1) applies to rights exercised or disposed of after 2004 under agreements to sell or issue securities made after 2002.

(4)Subsection (2) is deemed to have come into force on January 1, 2023.

4(1)Subparagraph 8(1)‍(f)‍(vi) of the French version of the Act is replaced by the following:

  • (vi)des dépenses qui ne seraient pas, en vertu de l’alinéa 18(1)l), déductibles dans le calcul du revenu du contribuable pour l’année, si son emploi Insertion start consistait en une Insertion end entreprise exploitée par lui;

(2)The portion of paragraph 8(1)‍(g) of the French version of the Act after subparagraph (ii) is replaced by the following:

  • les sommes qu’il a ainsi déboursées au cours de l’année, dans la mesure où il Insertion start n’a pas été remboursé et Insertion end n’a pas le droit d’être remboursé à cet égard;

(3)The portion of paragraph 8(1)‍(i) of the French version of the Act before subparagraph (i) is replaced by the following:

  • Cotisations et autres dépenses liées à l’exercice de fonctions

    i) Insertion start dans la mesure où il n’a pas été remboursé et n’a pas le droit d’être remboursé à cet égard Insertion end , les sommes payées par le contribuable au cours de l’année, ou les sommes payées pour son compte au cours de l’année si elles sont à inclure dans son revenu pour l’année, au titre :

5(1)Paragraph 12(1)‍(t) of the Act is replaced by the following:

  • Investment tax credit

    (t)the amount deducted under subsection 127(5) or (6) Insertion start or 127.‍48(3) Insertion end in respect of a property acquired or an expenditure made in a preceding taxation year in computing the taxpayer’s tax payable for a preceding taxation year to the extent that it was not included in computing the taxpayer’s income for a preceding taxation year under this paragraph or is not included in an amount determined under paragraph 13(7.‍1)‍(e) or 37(1)‍(e), subparagraph 53(2)‍(c)‍(vi) Insertion start or (viii.‍1) Insertion end or (h)‍(ii) or for I in the definition undepreciated capital cost in subsection 13(21) or L in the definition cumulative Canadian exploration expense in subsection 66.‍1(6);

(2)Paragraph 12(1)‍(t) of the Act, as enacted by subsection (1), is replaced by the following:

  • Investment tax credit

    (t)the amount deducted under subsection 127(5) or (6), 127.‍48(3) or Insertion start 127.‍49(6) Insertion end in respect of a property acquired or an expenditure made in a preceding taxation year in computing the taxpayer’s tax payable for a preceding taxation year to the extent that it was not included in computing the taxpayer’s income for a preceding taxation year under this paragraph or is not included in an amount determined under paragraph 13(7.‍1)‍(e) or 37(1)‍(e), subparagraph 53(2)‍(c)‍(vi), (viii.‍1) or Insertion start (viii.‍2) Insertion end or (h)‍(ii) or for I in the definition undepreciated capital cost in subsection 13(21) or L in the definition cumulative Canadian exploration expense in subsection 66.‍1(6);

(3)Paragraph 12(1)‍(x) of the Act is amended by striking out “and” at the end of subparagraph (vii), by adding “and” at the end of subparagraph (viii) and by adding the following after subparagraph (viii):
  • Start of inserted block

    (ix)was not received by the taxpayer as an excluded loan;

    End of inserted block

(4)Subsection 12(11) of the Act is amended by adding the following in alphabetical order:

Start of inserted block

excluded loan means a loan, other than a forgivable loan, evidenced in writing

  • (a)that is from a payer that is

    • (i)a government, municipality or other public authority in Canada, or

    • (ii)a person resident in Canada or Canadian partnership, if it is reasonable to conclude that the payer would not have made the loan but for the direct or indirect receipt by the payer of amounts from a government, municipality or other public authority in Canada;

  • (b)for which, at the time the loan was made, bona fide arrangements were made for repayment of the loan within a reasonable time; and

  • (c)the funds from which were used for the purpose of earning income from a business or property.‍ (prêt exclu)

    End of inserted block

(5)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023.

(6)Subsection (2) is deemed to have come into force on January 1, 2024.

(7)Subsections (3) and (4) are deemed to have come into force on January 1, 2020, and apply to loans made after December 31, 2019.

6(1)Section 13 of the Act is amended by adding the following after subsection (4):

COVID — time not counted
Start of inserted block
(4.‍01)For the purposes of subparagraph (4)‍(c)‍(ii), the period beginning on March 15, 2020 and ending on March 12, 2022 is not to be counted.
End of inserted block

(2)The portion of subsection 13(7.‍1) of the Act before paragraph (a) is replaced by the following:

Deemed capital cost of certain property
(7.‍1)For the purposes of this Act, where section 80 applied to reduce the capital cost to a taxpayer of a depreciable property or a taxpayer deducted an amount under subsection 127(5) or (6) Insertion start or 127.‍48(3) Insertion end in respect of a depreciable property or received or is entitled to receive assistance from a government, municipality or other public authority in respect of, or for the acquisition of, depreciable property, whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance other than

(3)The portion of subsection 13(7.‍1) of the Act before paragraph (a), as enacted by subsection (2), is replaced by the following:

Deemed capital cost of certain property
(7.‍1)For the purposes of this Act, where section 80 applied to reduce the capital cost to a taxpayer of a depreciable property or a taxpayer deducted an amount under subsection 127(5) or (6), 127.‍48(3) or Insertion start 127.‍49(6) Insertion end in respect of a depreciable property or received or is entitled to receive assistance from a government, municipality or other public authority in respect of, or for the acquisition of, depreciable property, whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance other than

(4)Subsection 13(7.‍1) of the Act is amended by striking out “or” at the end of paragraph (b), by adding “or” at the end of paragraph (b.‍1) and by adding the following after paragraph (b.‍1):

  • Start of inserted block

    (b.‍2)an amount received as an excluded loan as defined in subsection 12(11),

    End of inserted block

(5)Paragraph 13(7.‍1)‍(e) of the Act is replaced by the following:

  • (e)where the property was acquired in a taxation year ending before the particular time, all amounts deducted under subsection 127(5) or (6) Insertion start or 127.‍48(3) Insertion end by the taxpayer for a taxation year ending before the particular time,

(6)Paragraph 13(7.‍1)‍(e) of the Act, as enacted by subsection (5), is replaced by the following:

  • (e)where the property was acquired in a taxation year ending before the particular time, all amounts deducted under subsection 127(5) or (6), 127.‍48(3) or Insertion start 127.‍49(6) Insertion end by the taxpayer for a taxation year ending before the particular time,

(7)The description of I in the definition undepreciated capital cost in subsection 13(21) of the Act is replaced by the following:

I
is the total of all amounts deducted under subsection 127(5) or (6) Insertion start or 127.‍48(3) Insertion end , in respect of a depreciable property of the class of the taxpayer, in computing the taxpayer’s tax payable for a taxation year ending before that time and subsequent to the disposition of that property by the taxpayer,

(8)The description of I in the definition undepreciated capital cost in subsection 13(21) of the Act, as enacted by subsection (7), is replaced by the following:

I
is the total of all amounts deducted under subsection 127(5) or (6), 127.‍48(3) or Insertion start 127.‍49(6) Insertion end , in respect of a depreciable property of the class of the taxpayer, in computing the taxpayer’s tax payable for a taxation year ending before that time and subsequent to the disposition of that property by the taxpayer,

(9)The portion of paragraph 13(24)‍(a) of the Act before subparagraph (i) is replaced by the following:

  • (a)subject to paragraph (b), for the purposes of the description of A in the definition undepreciated capital cost in subsection (21) and of sections 127, 127.‍1 and Insertion start 127.‍48 Insertion end , the property is deemed

(10)The portion of paragraph 13(24)‍(a) of the Act before subparagraph (i), as enacted by subsection (9), is replaced by the following:

  • (a)subject to paragraph (b), for the purposes of the description of A in the definition undepreciated capital cost in subsection (21) and of sections 127, 127.‍1, 127.‍48 and Insertion start 127.‍49 Insertion end , the property is deemed

(11)Subsection (1) is deemed to have come into force on March 12, 2020.

(12)Subsections (2), (5), (7) and (9) are deemed to have come into force immediately after the expiration of March 27, 2023.

(13)Subsection (4) is deemed to have come into force on January 1, 2020, and applies to loans made after December 31, 2019.

(14)Subsections (3), (6), (8) and (10) are deemed to have come into force on January 1, 2024.

7Clause 39(1)‍(c)‍(iv)‍(C) of the Act is replaced by the following:

  • (C)a corporation referred to in section 6 of the Insertion start Winding-up and Restructuring Act Insertion end that was insolvent (within the meaning of that Act) and was a small business corporation at the time a winding-up order under that Act was made in respect of the corporation,

8(1)Section 44 of the Act is amended by adding the following after subsection (1):

COVID — time not counted
Start of inserted block
(1.‍01)For the purposes of paragraphs (1)‍(c) and (d), the period beginning on March 15, 2020 and ending on March 12, 2022 is not to be counted.
End of inserted block

(2)Subsection (1) is deemed to have come into force on March 12, 2020.

9Subparagraph 50(1)‍(b)‍(ii) of the Act is replaced by the following:

  • (ii)the corporation is a corporation referred to in section 6 of the Insertion start Winding-up and Restructuring Act Insertion end that is insolvent (within the meaning of that Act) and in respect of which a winding-up order under that Act has been made in the year, or

10(1)Subparagraph 53(1)‍(e)‍(xiii) of the Act is replaced by the following:

  • (xiii)any amount required by subsection 127(30) Insertion start or section 127.‍48 Insertion end to be added to the taxpayer’s tax otherwise payable under this Part for a taxation year that ended before that time Insertion start in respect of the interest in the partnership Insertion end ;

(2)Subparagraph 53(1)‍(e)‍(xiii) of the Act, as enacted by subsection (1), is replaced by the following:

  • (xiii)any amount required by subsection 127(30), section 127.‍48 or Insertion start subsection 127.‍49(17) Insertion end to be added to the taxpayer’s tax otherwise payable under this Part for a taxation year that ended before that time in respect of the interest in the partnership;

(3)Paragraph 53(2)‍(c) of the Act is amended by adding the following after subparagraph (viii):

  • Start of inserted block

    (viii.‍1)an amount equal to that portion of all amounts deemed deducted under subsection 127.‍48(3) in computing the tax otherwise payable by the taxpayer under this Part for the taxpayer’s taxation years ending before that time that may reasonably be attributed to amounts added in computing the clean hydrogen tax credit (as defined in subsection 127.‍48(1)) of the taxpayer under subsection 127.‍48(12),

    End of inserted block

(4)Paragraph 53(2)‍(c) of the Act, as modified by subsection (3), is amended by adding the following after subparagraph (viii.‍1):

  • Start of inserted block

    (viii.‍2)an amount equal to that portion of all amounts deemed deducted under subsection 127.‍49(6) in computing the tax otherwise payable by the taxpayer under this Part for the taxpayer’s taxation years ending before that time that may reasonably be attributed to amounts added in computing the CTM investment tax credit (as defined in subsection 127.‍49(1)) of the taxpayer under subsection 127.‍49(8),

    End of inserted block

(5)Subsections (1) and (3) are deemed to have come into force immediately after the expiration of March 27, 2023.

(6)Subsections (2) and (4) are deemed to have come into force on January 1, 2024.

11(1)Paragraph (b) of the description of B of the definition exemption threshold in section 54 of the English version of the Act is replaced by the following:

(b)the exemption threshold of the taxpayer in respect of the Insertion start flow-through Insertion end share class of property immediately before that earlier time;

(2)The portion of paragraph (b) of the definition fresh-start date in section 54 of the English version of the Act before subparagraph (i) is replaced by the following:

  • (b)in the case of any other property that is included in the Insertion start flow-through Insertion end share class of property, the day that is the later of

12Subparagraph 56(1)‍(a)‍(iv) of the Act is replaced by the following:

  • (iv)a benefit under Part I, VII.‍1, VIII or VIII.‍1 of the Insertion start Employment Insertion end Insurance Act,

13(1)Subparagraph 60(j)‍(iv) of the Act is amended by striking out “or” at the end of clause (A), by adding “or” at the end of clause (B) and by adding the following after clause (B):

  • Start of inserted block

    (C)to or under a registered retirement income fund under which the taxpayer is the annuitant, as defined in subsection 146.‍3(1), other than the portion thereof designated for a taxation year for the purposes of paragraph (l),

    End of inserted block

(2)The portion of paragraph 60(n) of the Act before subparagraph (i) is replaced by the following:

  • Repayment of pension or benefits

    (n)any amount paid by the taxpayer in the year as a repayment (otherwise than because of Part VII of the Employment Insurance Act or section 8 of the Canada Recovery Benefits Act) of any of the following amounts to the extent that the amount was included in computing the taxpayer’s income, and not deducted in computing the taxpayer’s taxable income, for the year or for a preceding taxation year, namely,

(3)Section 60 of the Act is amended by adding the following after paragraph (n.‍1):

  • Amounts repaid in subsequent years
    Start of inserted block

    (n.‍2)any amount paid by the taxpayer in a year (in this paragraph referred to as the “subsequent year”) that is after the year as a repayment of an amount that was included in computing the taxpayer’s income for the year under any of subparagraphs 56(1)‍(a)‍(i), (ii), (iv), (vi) or (vii) or paragraph 56(1)‍(r), to the extent that the amount paid

    • (i)exceeds the taxpayer’s taxable income for the subsequent year (determined without reference to paragraphs (n), (n.‍1) and (v.‍1)), and

    • (ii)is not deducted in computing the taxpayer’s taxable income for any other taxation year;

      End of inserted block

(4)Paragraph 60(r) of the Act is repealed.

(5)Paragraph 60(v.‍1) of the Act is replaced by the following:

  • EI benefit repayment

    (v.‍1)any benefit repayment payable by the taxpayer under Part VII of the Employment Insurance Act on or before April 30 of the following year, to the extent that the amount was not deductible in computing the taxpayer’s income for any preceding taxation year;

(6)Subsection (1) is deemed to have come into force on August 4, 2023.

(7)Subsection (3) applies to the 2019 and subsequent taxation years.

14(1)Paragraph 66(12.‍73)‍(e) of the Act is replaced by the following:
  • (e) Insertion start if Insertion end a corporation Insertion start fails to file the statement within the time required or Insertion end fails in the statement Insertion start filed Insertion end to apply the excess fully to reduce one or more purported renunciations, the Minister may at any time reduce the total amount purported to be renounced by the corporation to one or more persons by the amount of the unapplied excess in which case, except for the purpose of Part XII.‍6, the amount purported to have been so renounced to a person is deemed, after that time, always to have been reduced by the portion of the unapplied excess allocated by the Minister in respect of that person.

(2)Subsection (1) is deemed to have come into force on August 4, 2023.

15(1)Subclause 66.‍8(1)‍(a)‍(ii)‍(B)‍(I) of the Act is replaced by the following:

  • (I)the Insertion start total of all amounts Insertion end required by subsections 127(8) Insertion start and 127.‍48(12) Insertion end in respect of the partnership to be added in computing the investment tax credit Insertion start or the clean hydrogen tax credit (as defined in subsection 127.‍48(1) Insertion end ) of the taxpayer in respect of the fiscal period, and

(2)Subclause 66.‍8(1)‍(a)‍(ii)‍(B)‍(I) of the Act, as enacted by subsection (1), is replaced by the following:

  • (I)the total of all amounts required by subsections 127(8), 127.‍48(12) and Insertion start 127.‍49(8) Insertion end in respect of the partnership to be added in computing the investment tax credit, the clean hydrogen tax credit (as defined in subsection 127.‍48(1)) or Insertion start the CTM investment tax credit (as defined in subsection 127.‍49(1) Insertion end ) of the taxpayer in respect of the fiscal period, and

(3)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023.

(4)Subsection (2) is deemed to have come into force on January 1, 2024.

16(1)The Act is amended by adding the following after section 67.‍6:

Definitions
Start of inserted block
67.‍7(1)The following definitions apply in this section.

non-compliant amount, for a taxation year, means the amount determined by the formula

A × B ÷ C
where

A
is the total of all amounts that would, if subsection (2) did not apply, be deductible in computing income in the taxation year in respect of the use of a residential property as a short-term rental in the taxation year;

B
is the number of days in the taxation year that the residential property was a non-compliant short-term rental; and

C
is the number of days in the taxation year that the residential property was a short-term rental. (montant non conforme)

non-compliant short-term rental means, at any time, a short-term rental that is located in a province or municipality that, at that time,

  • (a)does not permit the operation of the short-term rental at the location of the short-term rental; or

  • (b)requires registration, a licence or a permit to operate the short-term rental, and the short-term rental does not comply with all applicable registration, licensing and permit requirements.‍ (location à court terme non conforme)

residential property means all or any part of a house, apartment, condominium unit, cottage, mobile home, trailer, houseboat or other property, located in Canada, the use of which is permitted for residential purposes under applicable law.‍ (bien résidentiel)

short-term rental means a residential property that is rented or offered for rent for a period of less than 90 consecutive days.‍ (location à court terme)

End of inserted block
Non-deductibility of expenses — short-term rental
Start of inserted block
(2)Notwithstanding any other provision of this Act, no amount is deductible in computing income in respect of a short-term rental for a taxation year, to the extent the amount is a non-compliant amount for the taxation year.
End of inserted block
Deemed compliance
Start of inserted block
(3)For the purposes of subsection (1), a short-term rental of a person or partnership is deemed not to be a non-compliant short-term rental for the 2024 taxation year of the person or partnership if
  • (a)the short-term rental is located in a province or municipality that requires registration, a licence or a permit to operate as a short-term rental; and

  • (b)the short-term rental complies with all applicable registration, licensing and permit requirements by December 31, 2024.

    End of inserted block
Reassessments
Start of inserted block
(4)Notwithstanding subsections 152(4) to (5), the Minister may make any assessments, reassessments and additional assessments of tax, interest and penalties and any determinations and redeterminations that are necessary to give effect to subsection (2) for any taxation year.
End of inserted block

(2)Subsection (1) applies to outlays made and expenses incurred after 2023.

17(1)Subsection 81(1) of the Act is amended by adding the following after paragraph (c):

  • Ship of resident corporations
    Start of inserted block

    (c.‍1)the income for the year of a corporation resident in Canada (if this Act were read without reference to subsection 250(4)) earned from international shipping, if that corporation satisfies the conditions set out in paragraphs 250(6)‍(a) and (b);

    End of inserted block

(2)The portion of subparagraph 81(1)‍(g.‍3)‍(i) of the Act before clause (A) is replaced by the following:

  • (i)the taxpayer is Insertion start a Insertion end trust established under

(3)Subparagraph 81(1)‍(g.‍3)‍(i) of the Act is amended by striking out “or” at the end of clause (D), by replacing “and” at the end of clause (E) with “or” and by adding the following after clause (E):

  • Start of inserted block

    (F)the Settlement Agreement entered into by His Majesty in right of Canada, dated effective as of April 19, 2023, in respect of the class actions relating to the First Nations Child and Family Services, Jordan’s Principle and Trout Class, and

    End of inserted block

(4)Subsection (1) applies to taxation years that begin on or after December 31, 2023.

(5)Subsections (2) and (3) are deemed to have come into force on January 1, 2024.

18(1)Subsection 87(2) of the Act is amended by adding the following after paragraph (qq):

  • Continuation of corporation
    Start of inserted block

    (qq.‍1)for the purposes of section 127.‍48, the new corporation is deemed to be the same corporation as, and a continuation of, each predecessor corporation;

    End of inserted block

(2)Paragraph 87(2)‍(qq.‍1) of the Act, as enacted by subsection (1), is replaced by the following:

  • Continuation of corporation

    (qq.‍1)for the purposes of sections 127.‍48 Insertion start and 127.‍49 Insertion end , the new corporation is deemed to be the same corporation as, and a continuation of, each predecessor corporation;

(3)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023.

(4)Subsection (2) is deemed to have come into force on January 1, 2024.

19(1)Subsection 88(1) of the Act is amended by adding the following after paragraph (e.‍3):

  • Start of inserted block

    (e.‍31)for the purposes of section 127.‍48, at the end of any particular taxation year ending after the subsidiary was wound up, the parent is deemed to be the same corporation as, and a continuation of, the subsidiary;

    End of inserted block

(2)Paragraph 88(1)‍(e.‍31) of the Act, as enacted by subsection (1), is replaced by the following:

  • (e.‍31)for the purposes of sections 127.‍48 and Insertion start 127.‍49 Insertion end , at the end of any particular taxation year ending after the subsidiary was wound up, the parent is deemed to be the same corporation as, and a continuation of, the subsidiary;

(3)Paragraph 88(2)‍(c) of the Act is replaced by the following:

  • (c)for the purpose of computing the income of the corporation for its taxation year that includes the particular time, paragraph 12(1)‍(t) shall be read as follows:

    • “(t)the amount deducted under subsection 127(5) or (6) Insertion start or 127.‍48(3) Insertion end in computing the taxpayer’s tax payable for the year or a preceding taxation year to the extent that it was not included under this paragraph in computing the taxpayer’s income for a preceding taxation year or is not included in an amount determined under paragraph 13(7.‍1)‍(e) or 37(1)‍(e) or subparagraph 53(2)‍(c)‍(vi) Insertion start or (viii.‍1) Insertion end or (h)‍(ii) or the amount determined for I in the definition undepreciated capital cost in subsection 13(21) or L in the definition cumulative Canadian exploration expense in subsection 66.‍1(6);”.

(4)Paragraph 88(2)‍(c) of the Act, as enacted by subsection (3), is replaced by the following:

  • (c)for the purpose of computing the income of the corporation for its taxation year that includes the particular time, paragraph 12(1)‍(t) shall be read as follows:

    • “(t)the amount deducted under subsection 127(5) or (6), 127.‍48(3) or Insertion start 127.‍49(6) Insertion end in computing the taxpayer’s tax payable for the year or a preceding taxation year to the extent that it was not included under this paragraph in computing the taxpayer’s income for a preceding taxation year or is not included in an amount determined under paragraph 13(7.‍1)‍(e) or 37(1)‍(e) or subparagraph 53(2)‍(c)‍(vi), (viii.‍1) or Insertion start (viii.‍2) Insertion end or (h)‍(ii) or the amount determined for I in the definition undepreciated capital cost in subsection 13(21) or L in the definition cumulative Canadian exploration expense in subsection 66.‍1(6);”.

(5)Subsections (1) and (3) are deemed to have come into force immediately after the expiration of March 27, 2023.

(6)Subsections (2) and (4) are deemed to have come into force on January 1, 2024.

20Section 89 of the Act is amended by adding the following after subsection (14.‍1):

Late designation — transitional ERDTOH
Start of inserted block
(14.‍2)If, as a consequence of the application of subparagraph (a)‍(iii) of the definition eligible refundable dividend tax on hand in subsection 129(4), in the opinion of the Minister, the circumstances are such that it would be just and equitable to permit a designation under subsection (14) to be made before the day that is six years after the day on which the designation was required to be made, the designation is deemed to have been made at the time the designation was required to be made.
End of inserted block

21(1)The portion of clause 95(2)‍(a)‍(ii)‍(D) of the Act before subclause (III) is replaced by the following:

  • (D)by another foreign affiliate (referred to in this clause as the “second affiliate”) of the taxpayer — in respect of which the taxpayer has a qualifying interest throughout the year — to the extent that the amounts are paid or payable by the second affiliate, in respect of any particular period in the year, Insertion start under a legal obligation to pay interest in respect of Insertion end

    • (I)borrowed money used for the purpose of earning income from property, or

    • (II)an amount payable for property acquired for the purpose of gaining or producing income from property

  • where

(2)Subsection (1) is deemed to have come into force on August 4, 2023.

22(1)Subparagraph 96(2.‍1)‍(b)‍(ii) of the Act is replaced by the following:

  • (ii)the amount required by subsection 127(8) Insertion start or 127.‍48(12) Insertion end in respect of the partnership to be added in computing the investment tax credit Insertion start or the clean hydrogen tax credit (as defined in subsection 127.‍48(1) Insertion end ) of the taxpayer for the taxation year,

(2)Subparagraph 96(2.‍1)‍(b)‍(ii) of the Act, as enacted by subsection (1), is replaced by the following:

  • (ii)the amount required by subsection 127(8), 127.‍48(12) Insertion start or 127.‍49(8) Insertion end in respect of the partnership to be added in computing the investment tax credit, the clean hydrogen tax credit (as defined in subsection 127.‍48(1)) or Insertion start the CTM investment tax credit (as defined in subsection 127.‍49(1) Insertion end ) of the taxpayer for the taxation year,

(3)The portion of subsection 96(2.‍2) of the Act before paragraph (a) is replaced by the following:

At-risk amount
(2.‍2)For the purposes of this section and sections 111, 127, Insertion start 127.‍48 Insertion end and Insertion start 127.‍491 Insertion end , the at-risk amount of a taxpayer, in respect of a partnership of which the taxpayer is a limited partner, at any particular time is the amount, if any, by which the total of

(4)The portion of subsection 96(2.‍2) of the Act before paragraph (a), as enacted by subsection (3), is replaced by the following:

At-risk amount
(2.‍2)For the purposes of this section and sections 111, 127, 127.‍48, Insertion start 127.‍49 Insertion end and 127.‍491, the at-risk amount of a taxpayer, in respect of a partnership of which the taxpayer is a limited partner, at any particular time is the amount, if any, by which the total of

(5)The portion of subsection 96(2.‍4) of the Act before paragraph (a) is replaced by the following:

Limited partner
(2.‍4)For the purposes of this section and sections 111, 127, Insertion start 127.‍48 Insertion end and Insertion start 127.‍491 Insertion end , a taxpayer who is a member of a partnership at a particular time is a limited partner of the partnership at that time if the member’s partnership interest is not an exempt interest (within the meaning assigned by subsection (2.‍5)) at that time and if, at that time or within three years after that time,

(6)The portion of subsection 96(2.‍4) of the Act before paragraph (a), as enacted by subsection (5), is replaced by the following:

Limited partner
(2.‍4)For the purposes of this section and sections 111, 127, 127.‍48, Insertion start 127.‍49 Insertion end and 127.‍491, a taxpayer who is a member of a partnership at a particular time is a limited partner of the partnership at that time if the member’s partnership interest is not an exempt interest (within the meaning assigned by subsection (2.‍5)) at that time and if, at that time or within three years after that time,

(7)Subsections (1), (3) and (5) are deemed to have come into force immediately after the expiration of March 27, 2023.

(8)Subsections (2), (4) and (6) are deemed to have come into force on January 1, 2024.

23(1)Section 108 of the Act is amended by adding the following after subsection (2):

Interest rate hedging agreements
Start of inserted block
(2.‍1)For the purposes of subparagraph (2)‍(b)‍(iv), if an amount included in computing the income of a trust is derived from, or from the disposition of, an agreement that can reasonably be considered to have been made by the trust to reduce its risk from fluctuations in interest rates in respect of debt incurred by the trust to acquire or refinance property described in subparagraph (2)‍(b)‍(iii), the amount is deemed to be derived from that property.
End of inserted block

(2)Subsection (1) applies to taxation years that end after 2021.

24(1)Clause 111(1)‍(e)‍(ii)‍(A) of the Act is replaced by the following:

  • (A)the amount required by subsection 127(8) Insertion start or 127.‍48(12) Insertion end in respect of the partnership to be added in computing the investment tax credit Insertion start or the clean hydrogen tax credit (as defined in subsection 127.‍48(1) Insertion end ) of the taxpayer for the taxation year,

(2)Clause 111(1)‍(e)‍(ii)‍(A) of the Act, as enacted by subsection (1), is replaced by the following:

  • (A)the amount required by subsection 127(8), 127.‍48(12) or Insertion start 127.‍49(8) Insertion end in respect of the partnership to be added in computing the investment tax credit, the clean hydrogen tax credit (as defined in subsection 127.‍48(1)) or Insertion start the CTM investment tax credit (as defined in subsection 127.‍49(1) Insertion end ) of the taxpayer for the taxation year,

(3)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023.

(4)Subsection (2) is deemed to have come into force on January 1, 2024.

25(1)Paragraph 116(5)‍(a) of the French version of the Act is replaced by the following:

  • a)après enquête Insertion start raisonnable Insertion end , l’acheteur n’avait aucune raison de croire que la personne ne résidait pas au Canada;

(2)Paragraph 116(5.‍01)‍(a) of the French version of the Act is replaced by the following:

  • a)après enquête Insertion start raisonnable Insertion end , l’acheteur en vient à la conclusion que la personne non-résidente est, aux termes d’un traité fiscal que le Canada a conclu avec un pays donné, un résident de ce pays;

(3)The portion of paragraph 116(5.‍3)‍(a) of the French version of the Act before subparagraph (i) is replaced by the following:

  • a)le contribuable, sauf si le paragraphe (5.‍01) s’applique à l’acquisition ou si, après enquête Insertion start raisonnable Insertion end , le contribuable n’avait pas de raison de croire que la personne non-résidente n’était pas un résident du Canada, est tenu de payer, au titre de l’impôt prévu par la présente partie pour l’année pour le compte de la personne non-résidente, 50 % de l’excédent du montant visé au sous-alinéa (i) sur le montant visé au sous-alinéa (ii) :

26(1)The portion of subsection 118.‍06(2) of the Act before paragraph (a) is replaced by the following:

Volunteer firefighter tax credit
(2)For the purpose of computing the tax payable under this Part for a taxation year by an individual who performs eligible volunteer firefighting services in the year, there may be deducted the amount determined by multiplying $ Insertion start 6,000 Insertion end by the appropriate percentage for the taxation year if the individual

(2)Subsection (1) applies to the 2024 and subsequent taxation years.

27(1)The portion of subsection 118.‍07(2) of the Act before paragraph (a) is replaced by the following:

Search and rescue volunteer tax credit
(2)For the purpose of computing the tax payable under this Part for a taxation year by an individual who performs eligible search and rescue volunteer services in the year, there may be deducted the amount determined by multiplying $ Insertion start 6,000 Insertion end by the appropriate percentage for the taxation year if the individual

(2)Subsection (1) applies to the 2024 and subsequent taxation years.

28(1)Paragraph 118.‍2(2)‍(v) of the Act is replaced by the following:

  • (v)to a fertility clinic, or donor bank, in Canada as a fee or other amount paid or payable, to obtain sperm, ova Insertion start or embryos Insertion end to enable the conception of a child by the individual, the individual’s spouse or common-law partner or a surrogate mother on behalf of the individual.

(2)Subsection (1) is deemed to have come into force on January 1, 2022.

29(1)Subparagraph 120.‍2(1)‍(b)‍(i) of the Act is replaced by the following:

  • (i)the amount that, but for this section, section 120 and subsection 120.‍4(2), would be the individual’s tax payable under this Part for the particular year if the individual were not entitled to any deduction under Insertion start section Insertion end 126

(2)Paragraph 120.‍2(3)‍(b) of the Act is replaced by the following:

  • (b)the amount that, if this Act were read without reference to section 120, would be the individual’s tax payable under this Part for the year if the individual were not entitled to any deduction under Insertion start section Insertion end 126, and

(3)Subsections (1) and (2) apply to taxation years that begin after December 31, 2023.

30Paragraph (a) of the definition shared-custody parent in section 122.‍6 of the English version of the Act is replaced by the following:

  • (a)are not at that time Insertion start cohabiting Insertion end spouses or common-law partners of each other,

31(1)Section 122.‍62 of the Act is amended by adding the following after subsection (8):

Death of child — qualified dependant
Start of inserted block
(9)For the purposes of this Subdivision (other than subsection (4)), a person is deemed to be a qualified dependant at the beginning of a month if
  • (a)the person died in any of the six preceding months;

  • (b)the person’s date of birth was not 18 years or more prior to the beginning of the month; and

  • (c)the person was a qualified dependant immediately prior to their death.

    End of inserted block
Death of child — eligible individual
Start of inserted block
(10)For the purposes of this Subdivision (other than subsection (4)), a person is deemed to be an eligible individual in respect of a qualified dependant at the beginning of a month if
  • (a)that qualified dependant is a qualified dependant at the beginning of that month because of subsection (9); and

  • (b)the person was an eligible individual in respect of the qualified dependant immediately before the qualified dependant’s death.

    End of inserted block
Death of child
Start of inserted block
(11)For the purposes of paragraphs (a) and (b) of the description of E in subsection 122.‍61(1), if a person is deemed to be a qualified dependant at the beginning of a month because of subsection (9), the person is deemed to be the age at the beginning of that month that the person would have been at the beginning of that month had the person not died.
End of inserted block
Death of child — disability tax credit
Start of inserted block
(12)For the purposes of paragraph (a) of the description of N in subsection 122.‍61(1), if a person died on or after July 1 of a particular taxation year and an amount could have been deducted in respect of that person under section 118.‍3 for that taxation year, an amount is deemed to be deductible under section 118.‍3 in respect of that person for the immediately following taxation year.
End of inserted block

(2)Subsection (1) applies in respect of the death of a person that occurs after 2024.

32(1)Subsection 122.‍92(1) of the Act is amended by adding the following in alphabetical order:
Start of inserted block

return of income, in respect of an eligible individual for a taxation year, means the eligible individual’s return of income (other than a return of income under subsection 70(2) or 104(23), paragraph 128(2)‍(e) or subsection 150(4)) that is required to be filed for the taxation year or that would be required to be filed if the eligible individual had tax payable under this Part for the taxation year.‍ (déclaration de revenu)

End of inserted block

(2)Subsection (1) is deemed to have come into force on January 1, 2022.

33(1)The definition qualifying labour expenditure in subsection 125.‍6(1) of the Act is replaced by the following:

qualifying labour expenditure of a taxpayer for a taxation year in respect of an eligible newsroom employee, for a taxation year

  • Start of inserted block

    (a)that begins before 2023 and ends after 2022, means the lesser of

    • (i)the amount determined by the formula

      $85,000 × A ÷ 365
      where

      A
      is the lesser of 365 and the number of days in the taxation year that are after 2022 during which the taxpayer is a qualifying journalism organization, and

    • (ii)the amount determined by the formula

      A − B
      where

      A
      is the amount determined by the formula

      C × D ÷ E
      where

      C
      is the salary or wages payable by the taxpayer to the eligible newsroom employee in respect of the portion of the taxation year throughout which the taxpayer is a qualifying journalism organization,

      D
      is the number of days in the taxation year that are after 2022 during which the taxpayer is a qualifying journalism organization, and

      E
      is the number of days in the taxation year during which the taxpayer is a qualifying journalism organization, and

      B
      is the amount determined by the formula

      F × G ÷ H
      where

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

      (A)the taxpayer has received, is entitled to receive or can reasonably be expected to receive, in respect of amounts described in C, and

      (B)has not been repaid before the end of the year pursuant to a legal obligation to do so,

      G
      is the number of days in the taxation year that are after 2022 during which the taxpayer is a qualifying journalism organization, and 

      H
      is the number of days in the taxation year during which the taxpayer is a qualifying journalism organization; and 

      End of inserted block
  • Insertion start (b) Insertion end Insertion start Insertion end Insertion start that begins after 2022 Insertion end , means the lesser of

    • Insertion start (i) Insertion end the amount determined by the formula

      $ Insertion start 85,000 Insertion end × A ÷ 365
      where

      A
      is the lesser of 365 and the number of days in the taxation year Insertion start during Insertion end which the taxpayer is a qualifying journalism organization, and

    • Insertion start (ii) Insertion end the amount determined by the formula

      A − B
      where

      A
      is the salary or wages payable by the taxpayer to the eligible newsroom employee in respect of the portion of the taxation year throughout which the taxpayer is a qualifying journalism organization, and

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

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

      (B)has not been repaid before the end of the year pursuant to a legal obligation to do so. (dépense de main-d’œuvre admissible)

(2)Subsection 125.‍6(1) of the Act is amended by adding the following in alphabetical order:

Start of inserted block

low threshold qualifying labour expenditure of a taxpayer for a taxation year that begins before 2023 and ends after 2022, in respect of an eligible newsroom employee, means the lesser of

  • (a)the amount determined by the formula

    $55,000 × A ÷ 365
    where

    A
    is the lesser of 365 and the number of days in the taxation year that are before 2023 during which the taxpayer is a qualifying journalism organization, and

  • (b)the amount determined by the formula

    A − B
    where

    A
    is the amount determined by the formula

    C × D ÷ E
    where

    C
    is the salary or wages payable by the taxpayer to the eligible newsroom employee in respect of the portion of the taxation year throughout which the taxpayer is a qualifying journalism organization,

    D
    is the number of days in the taxation year that are before 2023 during which the taxpayer is a qualifying journalism organization, and

    E
    is the number of days in the taxation year during which the taxpayer is a qualifying journalism organization, and

    B
    is the amount determined by the formula

    F × G ÷ H
    where

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

    (i)the taxpayer has received, is entitled to receive or can reasonably be expected to receive, in respect of amounts described in C, and

    (ii)has not been repaid before the end of the year pursuant to a legal obligation to do so,

    G
    is the number of days in the taxation year that are before 2023 during which the taxpayer is a qualifying journalism organization, and 

    H
    is the number of days in the taxation year during which the taxpayer is a qualifying journalism organization.‍ (seuil inférieur de dépense de main-d’œuvre admissible)

    End of inserted block

(3)Subsections 125.‍6(2) and (2.‍1) of the Act are replaced by the following:

Tax credit
(2)A taxpayer (other than a partnership) that is a qualifying journalism organization at any time in a taxation year and that files a prescribed form containing prescribed information with its return of income for the year 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
  • Start of inserted block

    (a)if the year begins before 2023 and ends after 2022, an amount determined by the formula

    0.‍25 × A + 0.‍35 × B − C
    where

    A
    is the total of all amounts each of which is a low threshold qualifying labour expenditure of the qualifying journalism organization for the year in respect of an eligible newsroom employee,

    B
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the year in respect of an eligible newsroom employee, and

    C
    is the amount received by the taxpayer from the Aid to Publishers component of the Canada Periodical Fund in the year;

  • (b)if the year begins after 2022 and ends before 2027, an amount determined by the formula

    0.‍35 × A − B
    where

    A
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the year in respect of an eligible newsroom employee, and

    B
    is the amount received by the taxpayer from the Aid to Publishers component of the Canada Periodical Fund in the year;

  • (c)if the year begins before 2027 and ends after 2026, an amount determined by the formula

    0.‍35 × A + 0.‍25 × B − C
    where

    A
    is the amount determined by the formula

    D × E ÷ F
    where

    D
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the year in respect of an eligible newsroom employee,

    E
    is the number of days in the taxation year that are before 2027 during which the taxpayer is a qualifying journalism organization, and

    F
    is the number of days in the taxation year during which the taxpayer is a qualifying journalism organization,

    B
    is the amount determined by the formula

    G × H ÷ I
    where

    G
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the year in respect of an eligible newsroom employee,

    H
    is the number of days in the taxation year that are after 2026 during which the taxpayer is a qualifying journalism organization, and

    I
    is the number of days in the taxation year during which the taxpayer is a qualifying journalism organization, and

    C
    is the amount received by the taxpayer from the Aid to Publishers component of the Canada Periodical Fund in the year; and

    End of inserted block
  • Insertion start (d) Insertion end Insertion start Insertion end Insertion start if the year begins after 2026 Insertion end , an amount determined by the formula

    0.‍25 × A − B
    where

    A
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the year in respect of an eligible newsroom employee, and

    B
    is the amount received by the taxpayer from the Aid to Publishers component of the Canada Periodical Fund in the year.

Partnership — tax credit
(2.‍1)If a taxpayer (other than a partnership) is a member of a partnership (other than a specified member of the partnership) at the end of a fiscal period of the partnership that ends in a taxation year of the taxpayer, the partnership is a qualifying journalism organization at any time in that fiscal period and the partnership files an information return in prescribed form containing prescribed information for that fiscal period, then the taxpayer is deemed to have, on the taxpayer’s balance-due day for the taxation year, paid on account of the taxpayer’s tax payable under this Part for the taxation year
  • Start of inserted block

    (a)if the fiscal period begins before 2023 and ends after 2022, an amount determined by the formula

    (0.‍25 × A + 0.‍35 × B − C) × D ÷ E
    where

    A
    is the total of all amounts each of which is a low threshold qualifying labour expenditure of the qualifying journalism organization for the fiscal period in respect of an eligible newsroom employee,

    B
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the fiscal period in respect of an eligible newsroom employee,

    C
    is the amount received by the qualifying journalism organization from the Aid to Publishers component of the Canada Periodical Fund in the fiscal period,

    D
    is the specified proportion of the taxpayer for the fiscal period, and

    E
    is the total of all specified proportions of members of the partnership for the fiscal period, other than members that are partnerships or specified members of the partnership;

  • (b)if the fiscal period begins after 2022 and ends before 2027, an amount determined by the formula

    (0.‍35 × A − B) × C ÷ D
    where

    A
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the fiscal period in respect of an eligible newsroom employee,

    B
    is the amount received by the qualifying journalism organization from the Aid to Publishers component of the Canada Periodical Fund in the fiscal period,

    C
    is the specified proportion of the taxpayer for the fiscal period, and

    D
    is the total of all specified proportions of members of the partnership for the fiscal period, other than members that are partnerships or specified members of the partnership;

  • (c)if the fiscal period begins before 2027 and ends after 2026, an amount determined by the formula

    (0.‍35 × A + 0.‍25 × B − C) × D ÷ E
    where

    A
    is the amount determined by the formula

    F × G ÷ H
    where

    F
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the fiscal period in respect of an eligible newsroom employee,

    G
    is the number of days in the fiscal period that are before 2027 during which the partnership is a qualifying journalism organization, and

    H
    is the number of days in the fiscal period during which the partnership is a qualifying journalism organization,

    B
    is the amount determined by the formula

    I × J ÷ K
    where

    I
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the fiscal period in respect of an eligible newsroom employee,

    J
    is the number of days in the fiscal period that are after 2026 during which the partnership is a qualifying journalism organization, and

    K
    is the number of days in the fiscal period during which the partnership is a qualifying journalism organization,

    C
    is the amount received by the qualifying journalism organization from the Aid to Publishers component of the Canada Periodical Fund in the fiscal period,

    D
    is the specified proportion of the taxpayer for the fiscal period, and

    E
    is the total of all specified proportions of members of the partnership for the fiscal period, other than members that are partnerships or specified members of the partnership; and

    End of inserted block
  • Insertion start (d) Insertion end Insertion start Insertion end Insertion start if the fiscal period begins after 2026 Insertion end , an amount determined by the formula

    (0.‍25 × A − B) × C ÷ D
    where

    A
    is the total of all amounts each of which is a qualifying labour expenditure of the qualifying journalism organization for the fiscal period in respect of an eligible newsroom employee,

    B
    is the amount received by the qualifying journalism organization from the Aid to Publishers component of the Canada Periodical Fund in the fiscal period,

    C
    is the specified proportion of the taxpayer for the fiscal period, and

    D
    is the total of all specified proportions of members of the partnership for the fiscal period, other than members that are partnerships or specified members of the partnership.

(4)Subsections (1) to (3) are deemed to have come into force on January 1, 2023.

34(1)Paragraph (a) of the definition flow-through mining expenditure in subsection 127(9) of the Act is replaced by the following:

  • (a)that is a Canadian exploration expense incurred by a corporation after March Insertion start 2024 Insertion end and before Insertion start 2026 Insertion end (including, for greater certainty, an expense that is deemed by subsection 66(12.‍66) to be incurred before Insertion start 2026 Insertion end ) in conducting mining exploration activity from or above the surface of the earth for the purpose of determining the existence, location, extent or quality of a mineral resource described in paragraph (a) or (d) of the definition mineral resource in subsection 248(1),

(2)Paragraphs (c) and (d) of the definition flow-through mining expenditure in subsection 127(9) of the Act are replaced by the following:

  • (c)an amount in respect of which is renounced in accordance with subsection 66(12.‍6) by the corporation to the taxpayer (or a partnership of which the taxpayer is a member) under an agreement described in that subsection and made after March Insertion start 2024 Insertion end and before April Insertion start 2025 Insertion end ,

  • (d)that is not an expense that was renounced under subsection 66(12.‍6) to the corporation (or a partnership of which the corporation is a member), unless that renunciation was under an agreement described in that subsection and made after March Insertion start 2024 Insertion end and before April Insertion start 2025 Insertion end , and

(3)The definition government assistance in subsection 127(9) of the Act is replaced by the following:

government assistance means assistance from a government, municipality or other public authority whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance, other than Insertion start as an excluded loan (as defined in subsection 12(11)) or Insertion end as a deduction under subsection (5) or (6); (aide gouvernementale)

(4)The definition government assistance in subsection 127(9) of the Act, as enacted by subsection (3), is replaced by the following:

government assistance means assistance from a government, municipality or other public authority whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance, other than as an excluded loan (as defined in subsection 12(11)) or as a deduction under subsection (5) or (6) Insertion start or a deemed payment on account of tax payable under subsection 127.‍48(2) Insertion end ; (aide gouvernementale)

(5)The definition government assistance in subsection 127(9) of the Act, as enacted by subsection (4), is replaced by the following:

government assistance means assistance from a government, municipality or other public authority whether as a grant, subsidy, forgivable loan, deduction from tax, investment allowance or as any other form of assistance, other than as an excluded loan (as defined in subsection 12(11)) or as a deduction under subsection (5) or (6) or a deemed payment on account of tax payable under subsection 127.‍48(2) Insertion start or 127.‍49(2) Insertion end ; (aide gouvernementale)

(6)Subsections (1) and (2) apply in respect of expenses renounced under a flow-through share agreement entered into after March 2024.

(7)Subsection (3) is deemed to have come into force on January 1, 2020, and applies to loans made after December 31, 2019.

(8)Subsection (4) is deemed to have come into force immediately after the expiration of March 27, 2023.

(9)Subsection (5) is deemed to have come into force on January 1, 2024.

35The Act is amended by adding the following after section 127.‍42:

Definitions
Start of inserted block
127.‍421(1)The following definitions apply in this section.

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

fuel return specified, for a designated province for a calendar year, means the amount specified by the Minister of Finance for a person employed by a corporation for the designated province for the calendar year.‍ (montant lié aux carburants spécifié)

person employed, by a corporation for a calendar year, means a person who was at any time in the calendar year employed by the corporation and in respect of whom the corporation issued (or a payroll service provider issued on behalf of the corporation) a statement of remuneration paid.‍ (personne employée)

2023 business number means the business number of a corporation which the corporation used to make remittances for employees for the corporation’s last taxation year ending in 2023.‍ (numéro d’entreprise 2023)

End of inserted block
Deemed amount 2019-2023
Start of inserted block
(2)A corporation that files, on or before July 15, 2024, a return of income for a taxation year ending in 2023 (other than a final return on dissolution) is deemed to have paid on a date specified by the Minister of Finance, on account of tax payable under this Part for that taxation year, the total of all amounts, each of which is an amount, for each designated province, for each calendar year that is 2019, 2020, 2021, 2022 and 2023, determined by the formula
A × B × C
where

A
is the fuel return specified for the designated province, for the calendar year;

B
is

(a)if the total number of persons each of whom was a person employed by the corporation in a province at any time in the calendar year exceeds 499, nil, and

(b)in any other case, the total number of persons, each of whom was a person employed by the corporation in the designated province in the calendar year; and

C
is

(a)if the corporation was a Canadian-controlled private corporation at all times in the taxation year ending in 2023, 1, and

(b)in any other case, nil.

End of inserted block
Deemed amount after 2023
Start of inserted block
(3)A corporation that files a return of income for a particular taxation year ending in a calendar year after 2023 (other than a final return on dissolution) is, if the return is filed on or before July 15 of the following calendar year, deemed to have paid on its balance-due day for the year, on account of tax payable under this Part for the particular taxation year, the total of all amounts, each of which is an amount, for each designated province for the calendar year, determined by the formula
A × B × C
where

A
is the fuel return specified for the designated province, for the calendar year;

B
is

(a)if the total number of persons each of whom was a person employed by the corporation in a province at any time in the calendar year exceeds 499, nil, and

(b)in any other case, the total number of persons, each of whom was a person employed by the corporation in the designated province in the calendar year; and

C
is

(a)if the corporation was a Canadian-controlled private corporation at all times in the particular taxation year, 1, and

(b)in any other case, nil.

End of inserted block
Authority to specify
Start of inserted block
(4)For the purposes of this section, the Minister of Finance may specify for a calendar year
  • (a)the designated provinces; and

  • (b)the fuel return specified for a designated province.

    End of inserted block
Amount not specified
Start of inserted block
(5)For the purposes of this section, if the Minister of Finance does not specify a fuel return specified for a designated province for a calendar year under paragraph (4)‍(b), the fuel return specified for the designated province for the calendar year is deemed to be nil.
End of inserted block
Assistance received
Start of inserted block
(6)For the purposes of this Act, an amount deemed by this section to have been paid on account of tax payable for a taxation year is assistance received by the taxpayer from a government in the taxation year in which the assistance is received.
End of inserted block
Deemed rebate in respect of fuel charges
Start of inserted block
(7)An amount for a designated province included in the total of all amounts deemed by this section to have been paid on account of tax payable for a taxation year is deemed to have been paid during the taxation year as a rebate in respect of charges levied under Part 1 of the Greenhouse Gas Pollution Pricing Act in respect of the designated province.
End of inserted block
Predecessor corporation
Start of inserted block
(8)For the purposes of subsection (2), where there has been an amalgamation or merger of two or more corporations before 2023, the corporation filing a return of income in 2023 is deemed to be the same corporation as and a continuation of each predecessor corporation that was registered with the Minister to make remittances required under section 153 under the corporation’s 2023 business number.
End of inserted block
Predecessor corporation
Start of inserted block
(9)For the purposes of subsections (2) and (3), the number of persons employed by a corporation in a calendar year after 2022 is deemed to be nil in that year if the corporation is formed by an amalgamation or merger in that calendar year.
End of inserted block
Province of employment
Start of inserted block
(10)For the purposes of this section, if a person is employed by the same corporation in more than one province in a calendar year, the person is deemed to be employed throughout the calendar year by that corporation in the province in respect of which the person has received the highest amount of remuneration paid by the corporation and is deemed not to be employed in any other province in the calendar year.
End of inserted block
Deemed taxation year
Start of inserted block
(11)For the purposes of subsection (3), if a corporation has more than one taxation year ending in the same calendar year, the particular taxation year is the first taxation year that ends in that calendar year.
End of inserted block

36(1)The heading before section 127.‍43 of the Act is repealed.

(2)Subsection (1) is deemed to have come into force on January 1, 2022.

37(1)The Act is amended by adding the following before Division E.‍1 of Part I:

Definitions
Start of inserted block
127.‍48(1)The following definitions apply in this section.

actual carbon intensity means the carbon intensity of hydrogen that is produced by a qualified clean hydrogen project of a taxpayer, based on the actual inputs to the production of hydrogen and actual emissions from the production of hydrogen by the project.‍ (intensité carbonique réelle)

average actual carbon intensity means, for the compliance period of a clean hydrogen project, the number determined by the formula 

((A × B) + (C × D) + (E × F) + (G × H) + (I × J)) ÷ K
where

A
is the actual carbon intensity of the project for the first operating year of the compliance period;

B
is the quantity, in kilograms, of hydrogen produced by the project in the first operating year of the compliance period;

C
is the actual carbon intensity of the project for the second operating year of the compliance period;

D
is the quantity, in kilograms, of hydrogen produced by the project in the second operating year of the compliance period;

E
is the actual carbon intensity of the project for the third operating year of the compliance period;

F
is the quantity, in kilograms, of hydrogen produced by the project in the third operating year of the compliance period;

G
is the actual carbon intensity of the project for the fourth operating year of the compliance period;

H
is the quantity, in kilograms, of hydrogen produced by the project in the fourth operating year of the compliance period;

I
is the actual carbon intensity of the project for the fifth operating year of the compliance period;

J
is the quantity, in kilograms, of hydrogen produced by the project in the fifth operating year of the compliance period; and

K
is the total quantity, in kilograms, of hydrogen produced by the project during the compliance period.‍ (intensité carbonique réelle moyenne)

captured carbon means captured carbon dioxide that

  • (a)would otherwise be released into the atmosphere; or

  • (b)is captured directly from the ambient air.‍ (carbone capté)

carbon dioxide equivalent means the carbon dioxide emissions that would be required to produce a warming effect equivalent to the emissions of any specified greenhouse gas, as determined in accordance with the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada over an assessment period of 100 years.‍ (équivalent en dioxyde de carbone)

carbon intensity means the quantity in kilograms of carbon dioxide equivalent per kilogram of hydrogen produced.‍ (intensité carbonique)

CCUS process means the process of carbon capture, utilization and storage that includes the

  • (a)capture of carbon dioxide

    • (i)that would otherwise be released into the atmosphere, or

    • (ii)directly from the ambient air; and

  • (b)storage or use of the captured carbon.‍ (processus de CUSC)

CCUS project means a project that is intended to support a CCUS process by

  • (a)capturing carbon dioxide

    • (i)that would otherwise be released into the atmosphere, or

    • (ii)directly from the ambient air;

  • (b)transporting captured carbon; or

  • (c)storing or using captured carbon.‍ (projet de CUSC)

CFR carbon intensity means carbon intensity as defined in subsection 1(1) of the Clean Fuel Regulations.‍ (intensité carbonique selon le RCP)

clean ammonia means ammonia produced from clean hydrogen.‍ (ammoniac propre)

clean ammonia equipment means equipment that is used solely for the purpose of producing ammonia, including equipment for

  • (a)converting hydrogen into ammonia;

  • (b)heat recovery and conversion;

  • (c)nitrogen generation;

  • (d)feed storage (unless the feed is stored hydrogen) and feed compression; and

  • (e)on-site refrigeration, transportation and storage of ammonia.‍ (matériel pour ammoniac propre)

clean hydrogen means hydrogen produced, whether solely or in conjunction with other gases, that has a carbon intensity of less than four.‍ (hydrogène propre)

clean hydrogen project of a taxpayer means a project involving

  • (a)the operation of eligible clean hydrogen property;

  • (b)the production of clean hydrogen; and

  • (c)if applicable, the production of clean ammonia that uses a feedstock of clean hydrogen produced by the project.‍ (projet pour l’hydrogène propre)

clean hydrogen project plan means a plan for a clean hydrogen project of a taxpayer that

  • (a)includes a front-end engineering design study (or an equivalent study as determined by the Minister of Natural Resources) for the project;

  • (b)sets out the expected sources of electricity to be consumed in connection with the project, including sources described in any eligible power purchase agreements;

  • (c)sets out the expected carbon intensity of the hydrogen to be produced by the project

    • (i)determined in accordance with subsection (6), and

    • (ii)supported by a report prepared by a qualified validation firm in respect of the project that includes attestations by the firm that

      • (A)the assumptions in the modelling of the expected carbon intensity are reasonable, and

      • (B)the expected carbon intensity has been determined in accordance with the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada;

  • (d)if the project is intended to produce clean ammonia, demonstrates

    • (i)that the project can reasonably be expected to have sufficient hydrogen production capacity to satisfy the needs of the taxpayer’s ammonia production facility, and

    • (ii)if the taxpayer’s hydrogen production facility and its ammonia production facility are not co-located, the feasibility of transporting hydrogen between the facilities;

  • (e)contains any information required in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document; and

  • (f)is filed by the taxpayer with the Minister of Natural Resources, in the form and manner determined by the Minister of Natural Resources.‍ (plan de projet pour l’hydrogène propre)

clean hydrogen tax credit of a qualifying taxpayer for a taxation year means

  • (a)the total of all amounts each of which is the specified percentage of the capital cost to the taxpayer of an eligible clean hydrogen property that is acquired by the taxpayer in the year; and

  • (b)the total of all amounts required by subsection (12) to be added in computing the taxpayer’s clean hydrogen tax credit at the end of the year.‍ (crédit d’impôt pour l’hydrogène propre)

compliance period in respect of a clean hydrogen project of a taxpayer, means the period of time beginning on the first day of the compliance period of the project and ending on the last day of the fifth operating year of the project.‍ (période de conformité)

dual-use electricity and heat equipment means equipment that is part of a clean hydrogen project (excluding electricity generation equipment that supports the project indirectly by way of an electrical utility grid), that supports the production of hydrogen from eligible hydrocarbons and that

  • (a)generates electrical energy, heat energy or a combination of electrical and heat energy, and more than 50% of either the electrical energy or heat energy that is expected to be produced over the first 20 years of the project’s operations, based on the most recent clean hydrogen project plan, is expected to support

    • (i)a CCUS project, unless the equipment uses fossil fuels and emits carbon dioxide that is not subject to capture by a CCUS process, or

    • (ii)a qualified clean hydrogen project, unless the equipment uses fossil fuels and emits carbon dioxide that is not subject to capture by a CCUS process; or

  • (b)is equipment that directly transmits electrical energy from equipment described in paragraph (a) to a qualified clean hydrogen project and more than 50% of the electrical energy to be transmitted by the equipment over the first 20 years of the project’s operations, based on the most recent clean hydrogen project plan, is expected to support the CCUS project or qualified clean hydrogen project.‍ (matériel pour électricité et chaleur à double usage)

dual-use hydrogen and ammonia equipment means equipment that is part of a clean hydrogen project and that is used for the generation of oxygen or nitrogen to be used all or substantially all in hydrogen and ammonia production for the project.‍ (matériel pour hydrogène et ammoniac à double usage)

eligible clean hydrogen property means property, other than excluded property, that

  • (a)is acquired by a qualifying taxpayer and becomes available for use in respect of a qualified clean hydrogen project of the taxpayer in Canada on or after March 28, 2023, determined without reference to subsection (5);

  • (b)has not been used, or acquired for use or lease, by any person or partnership for any purpose whatever before it was acquired by the taxpayer; and

  • (c)is property situated in Canada

    • (i)that is used all or substantially all to produce hydrogen through electrolysis of water, including electrolysers, rectifiers, purification equipment, water treatment and conditioning equipment and equipment used for hydrogen compression and storage,

    • (ii)that is used all or substantially all to produce hydrogen from eligible hydrocarbons, including pre-reformers, auto-thermal reformers, steam methane reformers, pre-heating equipment, syngas coolers, shift reactors, purification equipment, fired heaters, water treatment and conditioning equipment, equipment used in hydrogen compression and storage of hydrogen, oxygen production equipment and methanators,

    • (iii)that is

      • (A)clean ammonia equipment,

      • (B)dual-use electricity and heat equipment,

      • (C)dual-use hydrogen and ammonia equipment, or

      • (D)project support equipment,

    • (iv)that is physically and functionally integrated with equipment described in any of subparagraphs (i) to (iii) and that is ancillary equipment used solely to support the functioning of equipment described in any of subparagraphs (i) to (iii) within a hydrogen or ammonia production process as part of

      • (A)an electrical system,

      • (B)a feed supply system,

      • (C)a fuel supply system,

      • (D)a liquid delivery and distribution system,

      • (E)a cooling system,

      • (F)a process material storage and handling and distribution system,

      • (G)a process venting system,

      • (H)a process waste management system, or

      • (I)a utility air or nitrogen distribution system,

    • (v)that is equipment used for system safety and integrity, or as part of a control or monitoring system, solely to support equipment described in any of subparagraphs (i) to (iv), or

    • (vi)that is property used solely to convert another property that would not otherwise be described in subparagraphs (i) to (v) if the conversion causes the other property to satisfy the description in any of subparagraphs (i) to (v).‍ (bien admissible pour l’hydrogène propre)

eligible electricity generation source means, at any time, an electricity generation source that is

  • (a)wind;

  • (b)solar;

  • (c)hydro;

  • (d)nuclear; or

  • (e)geothermal or tidal, if, at that time,

    • (i)a technology-specific input carbon intensity for the generation source is available in the Fuel LCA Model, and

    • (ii)guidance in respect of the generation source is included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada.‍ (source admissible de production d’électricité)

eligible hydrocarbon means, at any time,

  • (a)natural gas;

  • (b)a substance sourced all or substantially all from raw natural gas;

  • (c)an eligible renewable hydrocarbon; or

  • (d)a substance that is

    • (i)a by-product from processing one or more substances described in paragraph (a) or (b), and

    • (ii)included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at that time.‍ (hydrocarbure admissible)

eligible pathway means the production of hydrogen

  • (a)from electrolysis of water; or

  • (b)from the reforming or partial oxidation of eligible hydrocarbons, with carbon dioxide captured using a CCUS process.‍ (méthode admissible)

eligible power purchase agreement means an agreement or other arrangement in writing that

  • (a)allows, or will allow, a taxpayer to purchase electricity from an eligible electricity generation source (including incremental nameplate capacity) that

    • (i)first commenced electricity generation on or after both

      • (A)November 3, 2022, and

      • (B)the earlier of the day that is

        • (I)24 months before the taxpayer’s first clean hydrogen project plan is filed with the Minister of Natural Resources, and

        • (II)36 months before the day on which hydrogen is first produced by the relevant clean hydrogen project of the taxpayer, and

    • (ii)is located in

      • (A)the same province as the clean hydrogen project and is connected to the electricity grid of that province,

      • (B)the exclusive economic zone of Canada and is directly connected to the grid of the province in which the project is located, or

      • (C)another province that has a provincial grid that is directly connected to the grid of the province in which the project is located, if the taxpayer has arranged for the necessary interprovincial transmission;

  • (b)grants, or will grant, the taxpayer the sole and exclusive right to the environmental attributes associated with the electricity; and

  • (c)is entered into by the taxpayer for the primary purpose of operating the taxpayer’s clean hydrogen project during all or any portion of the first 20 years of the project’s operations.‍ (entente pour l’achat d’électricité admissible)

eligible renewable hydrocarbon, in respect of a taxpayer, means a substance

  • (a)that is produced from non-fossil carbon;

  • (b)in respect of which a CFR carbon intensity can be determined under the Clean Fuel Regulations;

  • (c)that is included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at the time that the taxpayer files its most recent clean hydrogen project plan with the Minister of Natural Resources;

  • (d)that is sourced from a facility that first commenced production of the substance on or after both

    • (i)November 3, 2022, and

    • (ii)the earlier of the day that is

      • (A)24 months before the taxpayer’s first clean hydrogen project plan is filed with the Minister of Natural Resources, and

      • (B)36 months before the day on which hydrogen is first produced by the relevant clean hydrogen project of the taxpayer;

  • (e)that, if acquired by the taxpayer under an agreement, the agreement grants, or will grant, the taxpayer the sole and exclusive right to the environmental attributes associated with the substance; and

  • (f)that is acquired or produced by the taxpayer for the sole purpose of operating the clean hydrogen project during all or any portion of the first 20 years of the project’s operations.‍ (hydrocarbure renouvelable admissible)

excluded property means property that is 

  • (a)used solely

    • (i)to support a CCUS project, or

    • (ii)for using captured carbon in industrial production (including for enhanced oil recovery);

  • (b)equipment used for the off-site transmission, transportation or distribution of hydrogen or ammonia;

  • (c)equipment used to prepare hydrogen for transport, including liquefaction equipment and equipment used to compress hydrogen to levels suitable for transportation;

  • (d)an automotive vehicle or related refuelling or charging equipment;

  • (e)a building or other structure;

  • (f)construction equipment, furniture or office equipment; or

  • (g)equipment used for off-site storage.‍ (bien exclu)

expected carbon intensity means the carbon intensity of hydrogen that is expected to be produced by a particular clean hydrogen project of a taxpayer, as documented in the taxpayer’s clean hydrogen project plan in respect of the project.‍ (intensité carbonique attendue)

first day of the compliance period means, in respect of a clean hydrogen project of a taxpayer,

  • (a)unless paragraph (b) or (c) applies, the particular day that is 120 days after the day on which hydrogen is first produced by the project;

  • (b)if the taxpayer files an election in prescribed form and manner with the Minister with its return of income for the taxation year that includes the particular day referred to in paragraph (a), the day that is one year after the particular day; or

  • (c)if the taxpayer has filed an election under paragraph (b) and files a second election in prescribed form and manner with the Minister with its return of income for the taxation year that includes the day referred to in paragraph (b), the day that is two years after the particular day referred to in paragraph (a).‍ (premier jour de la période de conformité)

Fuel LCA Model means the Government of Canada’s Fuel Life Cycle Assessment Model that is published by the Minister of the Environment.‍ (modèle ACV des combustibles)

government assistance has the same meaning as in subsection 127(9).‍ (aide gouvernementale)

ineligible use means

  • (a)the emission of captured carbon into the atmosphere, other than

    • (i)for the purposes of system integrity or safety, or

    • (ii)incidental emission made in the ordinary course of operations;

  • (b)the storage or use of captured carbon for enhanced oil recovery; and

  • (c)any other storage or use that is not

    • (i)the storage of captured carbon in a geological formation located in a jurisdiction within Canada or the United States that has environmental laws and enforcement governing the permanent storage of captured carbon, or

    • (ii)the use of captured carbon in producing concrete in Canada or the United States using a process that mineralizes and permanently stores at least 60% of the captured carbon that is injected into the concrete.‍ (utilisation non admissible)

input carbon intensity in relation to a fuel, energy source or material input, means the quantity in kilograms of carbon dioxide equivalent per unit of fuel, energy source or material input that is released over the life cycle of that fuel, energy source or material input.‍ (intensité carbonique entrante)

non-government assistance has the same meaning as in subsection 127(9).‍ (aide non gouvernementale)

non-hydrogen or ammonia use means a use of a particular property at a particular time that would, if the property were acquired at that time, result in the property ceasing to be an eligible clean hydrogen property, determined without reference to paragraph (b) of that definition.‍ (utilisation autre que pour l’hydrogène ou l’ammoniac)

operating year means each cumulative 365-day period, the first of which begins on the first day of the compliance period of a taxpayer’s clean hydrogen project, disregarding any period during which the project is not operating.‍ (année d’exploitation)

preliminary clean hydrogen work activity means an activity that is preliminary to the acquisition, construction, fabrication or installation by or on behalf of a taxpayer of eligible clean hydrogen property in respect of the taxpayer’s clean hydrogen project including, but not limited to, a preliminary activity that is

  • (a)obtaining permits or regulatory approvals;

  • (b)performing front-end design or engineering work, including front-end engineering design studies (or equivalent studies as determined by the Minister of Natural Resources) but excluding detailed design or engineering work in relation to eligible clean hydrogen property;

  • (c)conducting feasibility studies or pre-feasibility studies (or equivalent studies as determined by the Minister of Natural Resources);

  • (d)conducting environmental assessments; or

  • (e)clearing or excavating land.‍ (travaux préliminaires pour l’hydrogène propre)

project support equipment means equipment that directly supports a qualified clean hydrogen project by

  • (a)transmitting electrical energy from on-site electrical generation equipment directly to the project;

  • (b)distributing electrical energy or heat energy; or

  • (c)delivering, collecting, recovering, treating or recirculating water, or a combination of those activities.‍ (matériel de soutien du projet)

qualified clean hydrogen project means a clean hydrogen project of a taxpayer, as described in the taxpayer’s clean hydrogen project plan, where the Minister of Natural Resources has confirmed in writing that

  • (a)the hydrogen will be produced from an eligible pathway;

  • (b)the expected carbon intensity contained in the taxpayer’s most recent clean hydrogen project plan

    • (i)is determined in accordance with subsection (6), and

    • (ii)can reasonably be expected to be achieved based on the project design; and

  • (c)if the project is intended to produce clean ammonia, the taxpayer has demonstrated

    • (i)that the project can reasonably be expected to have sufficient hydrogen production capacity to satisfy the needs of the taxpayer’s ammonia production facility, and

    • (ii)if the taxpayer’s hydrogen production facility and its ammonia production facility are not co-located, the feasibility of transporting hydrogen between the facilities.‍ (projet admissible pour l’hydrogène propre)

qualified validation firm means, in respect of a clean hydrogen project of a taxpayer, an engineer or engineering firm that

  • (a)is registered and in good standing with a professional association that has the authority or recognition by law of a jurisdiction in Canada to regulate the profession of engineering in

    • (i)the jurisdiction where the project is located, or

    • (ii)if there is no professional association in the jurisdiction described in subparagraph (i), a jurisdiction in Canada where a professional association regulates the profession of engineering;

  • (b)has appropriate insurance coverage;

  • (c)has expertise in modelling using the Fuel LCA Model and engineering expertise in production processes for hydrogen and, if applicable, ammonia;

  • (d)at all times, is independent of, deals at arm’s length with and is not an employee of the taxpayer; and

  • (e)meets the requirements described in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document.‍ (firme admissible de validation)

qualified verification firm means, in respect of a clean hydrogen project of a taxpayer, an individual or firm that

  • (a)is either

    • (i)an engineer or an engineering firm that is registered and in good standing with a professional association that has the authority or recognition by law of a jurisdiction in Canada to regulate the profession of engineering in

      • (A)the jurisdiction where the project is located, or

      • (B)if there is no professional association in the jurisdiction described in clause (A), a jurisdiction in Canada where a professional association regulates the profession of engineering, or

    • (ii)a verification body accredited and in good standing under the Clean Fuel Regulations;

  • (b)has appropriate insurance coverage;

  • (c)has expertise in life-cycle analysis of greenhouse gas emissions;

  • (d)at all times, is independent of, deals at arm’s length with and is not an employee of the taxpayer;

  • (e)is not a qualified validation firm in respect of the project; and

  • (f)meets the requirements described in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document.‍ (firme admissible de vérification)

qualifying taxpayer means a taxable Canadian corporation.‍ (contribuable admissible)

specified greenhouse gas means

  • (a)carbon dioxide;

  • (b)methane;

  • (c)nitrous oxide;

  • (d)sulphur hexafluoride; and

  • (e)any other greenhouse gases listed in the Fuel LCA Model and included in the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at the time that a taxpayer files its most recent clean hydrogen project plan with the Minister of Natural Resources.‍ (gaz à effet de serre déterminé)

specified percentage means

  • (a)in respect of the capital cost of an eligible clean hydrogen property (other than equipment described in paragraph (b)) that is acquired by a qualifying taxpayer for use in a clean hydrogen project,

    • (i)if the expected carbon intensity of the hydrogen to be produced by the project is less than 0.‍75 and the property is acquired

      • (A)before 2034, 40%,

      • (B)in 2034, 20%, and

      • (C)after 2034, 0%,

    • (ii)if the expected carbon intensity of the hydrogen to be produced by the project is 0.‍75 or greater and less than two and the property is acquired

      • (A)before 2034, 25%,

      • (B)in 2034, 12.‍5%, and

      • (C)after 2034, 0%,

    • (iii)if the expected carbon intensity of the hydrogen to be produced by the project is two or greater and less than four and the property is acquired

      • (A)before 2034, 15%,

      • (B)in 2034, 7.‍5%, and

      • (C)after 2034, 0%, and

    • (iv)if the expected carbon intensity of the hydrogen to be produced by the project is four or greater, 0%; and

  • (b)in respect of the capital cost of eligible clean hydrogen property that is clean ammonia equipment or equipment described in any of subparagraphs (c)‍(iv) to (vi) of the definition eligible clean hydrogen property in this subsection that is used solely in connection with clean ammonia equipment acquired by a qualifying taxpayer for use in a clean hydrogen project,

    • (i)subject to subparagraph (ii), if the equipment is acquired

      • (A)before 2034, 15%,

      • (B)in 2034, 7.‍5%, and

      • (C)after 2034, 0%,

    • (ii)if the expected carbon intensity of the hydrogen to be produced by the project and used in the production of ammonia is four or greater, 0%.‍ (pourcentage déterminé)

      End of inserted block
Clean hydrogen tax credit
Start of inserted block
(2)If a qualifying taxpayer files with its return of income for a taxation year a prescribed form containing prescribed information, the taxpayer is deemed to have paid on its balance-due day for the year an amount on account of the taxpayer’s tax payable under this Part for the year equal to the taxpayer’s clean hydrogen tax credit for the year.
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Deemed deduction
Start of inserted block
(3)For the purposes of this section, paragraph 12(1)‍(t), subsection 13(7.‍1), variable I of the definition undepreciated capital cost in subsection 13(21), subsection 53(2) and sections 127.‍49 and 129, the amount deemed under subsection (2) to have been paid by a taxpayer for a taxation year is deemed to have been deducted from the taxpayer’s tax otherwise payable under this Part for the year.
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Time limit for application
Start of inserted block
(4)A payment on account of tax payable shall not be deemed to be paid under subsection (2) if the taxpayer does not file with the Minister the prescribed form containing prescribed information described in subsection (2) in respect of the amount on or before the later of December 31, 2025 and the day that is one year after the taxpayer’s filing-due date for the year and, if the prescribed form is filed after the taxpayer’s filing-due date for the year, no payment by the taxpayer is deemed to arise under that subsection until the prescribed form containing prescribed information has been filed with the Minister.
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Time of acquisition
Start of inserted block
(5)For the purpose of this section, eligible clean hydrogen property is deemed not to have been acquired before the property becomes available for use by the taxpayer, determined without reference to paragraphs 13(27)‍(c) and (28)‍(d).
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Calculation of carbon intensity
Start of inserted block
(6)For the purposes of calculating the carbon intensity of hydrogen produced and to be produced by a clean hydrogen project of a taxpayer,
  • (a)the most recent Fuel LCA Model at the time of filing by the taxpayer of the most recent related clean hydrogen project plan with the Minister of Natural Resources shall be used, unless, at the time of filing any compliance report under subsection (16), the taxpayer elects to use a subsequent version of the Fuel LCA Model in calculating the actual carbon intensity of the project;

  • (b)in applying the Fuel LCA Model, an assessment of emissions from the production of hydrogen by the project and upstream emissions from the production of inputs to the hydrogen-production process shall be taken into account;

  • (c)the quantity of hydrogen produced by the project is to be adjusted to take into account any hydrogen that is consumed in the production process;

  • (d)if the taxpayer produces hydrogen from eligible hydrocarbons, any captured carbon that is subject to an ineligible use is deemed not to be captured;

  • (e)if, in connection with the project, the taxpayer generates or purchases, or proposes to generate or purchase, electricity that is

    • (i)generated, or to be generated, by the taxpayer from

      • (A)an eligible electricity generation source, the contribution of the electricity to carbon intensity is to correspond with the input carbon intensity of the technology-specific electricity in the Fuel LCA Model,

      • (B)on-site generation equipment that converts hydrogen, heat recovered from the taxpayer’s hydrogen or ammonia production equipment or eligible hydrocarbons (with carbon dioxide captured using a CCUS process) into electricity that supports the production of hydrogen from eligible hydrocarbons, the contribution of the electricity to carbon intensity is to be modelled as part of the project,

      • (C)a generator used for startup or emergency backup operations, the contribution of the electricity to carbon intensity is to be modelled as part of the project, and

      • (D)a generation source other than as described in any of clauses (A) to (C), the carbon intensity of the project is deemed to be greater than 4.‍5,

    • (ii)purchased, or to be purchased, pursuant to an eligible power purchase agreement,

      • (A)the contribution of the electricity to carbon intensity is to correspond with the input carbon intensity of the technology-specific electricity in the Fuel LCA Model, and

      • (B)the contribution of the electricity to expected carbon intensity is to be calculated in proportion to the number of years for which the agreement will be in place during the first 20 years of the project’s operations, and

    • (iii)otherwise sourced, or to be sourced, from a provincial grid, the contribution to carbon intensity of the net positive quantity of the electricity (after subtracting any electricity purchased by the taxpayer under an eligible power purchase agreement or generated by the taxpayer in respect of the project that is, in either case, transmitted to the grid by the taxpayer) is to be based on the input carbon intensity of the provincial grid in the Fuel LCA Model;

  • (f)in calculating the quantity of electricity described in paragraph (e), if the sum of the quantities of electricity from sources described in subparagraphs (e)‍(i) and (ii) exceeds the total electricity consumed or to be consumed by the project, then the electricity consumed or to be consumed by the project is deemed to be generated

    • (i)first, from the source described in subparagraph (e)‍(i), and

    • (ii)second, from the source described in subparagraph (e)‍(ii) to the extent of any excess;

  • (g)if the project uses, or proposes to use, eligible hydrocarbons for the purpose of producing hydrogen,

    • (i)where the eligible hydrocarbon is an eligible renewable hydrocarbon in respect of the taxpayer,

      • (A)the contribution of that eligible renewable hydrocarbon to carbon intensity is to be based on the most recent CFR carbon intensity that is determined under the Clean Fuel Regulations, adjusted as necessary, and

      • (B)the contribution of that eligible renewable hydrocarbon to expected carbon intensity is to be calculated in proportion to the number of years for which that hydrocarbon will be used during the first 20 years of the project’s operations, and

    • (ii)in any other case, the input carbon intensity of the relevant eligible hydrocarbon is to be taken into account in applying the Fuel LCA Model;

  • (h)if the taxpayer disposes of any environmental attributes associated with any electricity described in subparagraph (e)‍(i) or (ii) or any eligible renewable hydrocarbon described in subparagraph (g)‍(i), the carbon intensity of the project is deemed to be greater than 4.‍5; and

  • (i)the Clean Hydrogen Investment Tax Credit – Carbon Intensity Modelling Guidance Document published by the Government of Canada at the time of filing by the taxpayer of the most recent related clean hydrogen project plan with the Minister of Natural Resources, is to apply conclusively with respect to the calculation of carbon intensity, except as otherwise provided in this section.

    End of inserted block
Changes to clean hydrogen project
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(7)Subsection (8) applies in respect of a qualified clean hydrogen project of a taxpayer if, before the first day of the compliance period of the project,
  • (a)the Minister of Natural Resources determines that there has been a material change to the project design and requests that the taxpayer file a revised project plan for the project;

  • (b)the taxpayer

    • (i)does not file the final detailed engineering designs with the Minister of Natural Resources in accordance with paragraph (9)‍(d),

    • (ii)changes the project’s eligible pathway, or

    • (iii)reasonably expects that there will be an increase (as compared to the most recent project plan for the project) of more than 0.‍5 kilograms of carbon dioxide equivalent per kilogram of hydrogen to be produced by the project;

  • (c)any eligible power purchase agreement referenced in the most recent clean hydrogen project plan of the taxpayer

    • (i)has not been finalized and executed so as to become legally binding, or

    • (ii)has been materially modified or terminated; or

  • (d)any environmental attributes associated with the agreement have been disposed of by the taxpayer.

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Rules relating to revised project plan
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(8)If this subsection applies,
  • (a)the taxpayer shall file, within 180 days, a revised clean hydrogen project plan in respect of the project with the Minister of Natural Resources, in the form and manner determined by the Minister of Natural Resources;

  • (b)if the Minister of Natural Resources is satisfied that the project will meet the requirements in paragraphs (a) to (c) of the definition qualified clean hydrogen project,

    • (i)the Minister of Natural Resources shall confirm, with all due dispatch, the revised plan,

    • (ii)the taxpayer’s clean hydrogen tax credit shall be redetermined, as of the date of the filing of the revised plan, based on the expected carbon intensity set out in the revised plan, and

    • (iii)if the taxpayer previously deducted an amount in respect of a clean hydrogen tax credit, subsection (18) applies as if the compliance period ended on that date and the average actual carbon intensity of the project was equal to the expected carbon intensity set out in the revised plan;

  • (c)if the Minister of Natural Resources is not satisfied in accordance with paragraph (b) and does not issue a confirmation described in subparagraph (b)‍(i) within one year after the filing of the taxpayer’s revised plan, then, as of the expiry of that period,

    • (i)the project is deemed not to be a qualified clean hydrogen project,

    • (ii)the average actual carbon intensity of the project is deemed to be greater than 4.‍5, and

    • (iii)subsection (18) applies as if the compliance period of the project ended on the expiry date of that period; and

  • (d)if the taxpayer fails to file a revised clean hydrogen project plan in accordance with paragraph (a), then, as of the expiry of the 180-day period described in paragraph (a),

    • (i)subject to subparagraph (ii),

      • (A)the project is deemed not to be a qualified clean hydrogen project,

      • (B)the average actual carbon intensity of the project is deemed to be greater than 4.‍5, and

      • (C)subsection (18) applies as if the compliance period of the project ended on the expiry date of that period, and

    • (ii)once the taxpayer has filed the revised clean hydrogen project plan, subparagraph (i) is deemed never to have applied.

      End of inserted block
Clean hydrogen project determination and rules
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(9)For the purposes of this section,
  • (a)the Minister may, in consultation with the Minister of Natural Resources, determine that one or more clean hydrogen projects is one project or multiple projects

    • (i)at any time before the Minister of Natural Resources confirms the expected carbon intensity of the hydrogen to be produced by a clean hydrogen project, or

    • (ii)if a taxpayer files or is required to file a revised clean hydrogen project plan in accordance with subsection (8), at any time before the Minister of Natural Resources confirms the revised plan;

  • (b)any determination under paragraph (a) is deemed to result in the clean hydrogen project or clean hydrogen projects, as the case may be, being one project or multiple projects, as the case may be;

  • (c)for each project determined under paragraph (a), a taxpayer shall file a separate clean hydrogen project plan with the Minister of Natural Resources (in the form and manner determined by the Minister of Natural Resources) on or before the day that is 180 days after the determination is made;

  • (d)in respect of each clean hydrogen project, the taxpayer shall file final detailed engineering designs with the Minister of Natural Resources by the earlier of the day on which hydrogen is first produced by the project and the day that is 60 days after the final detailed engineering designs are prepared; and

  • (e)the Minister of Natural Resources may request from the taxpayer all documentation and information necessary for the Minister of Natural Resources to fulfill a responsibility under this section and may refuse to confirm the taxpayer’s clean hydrogen project plan or revised clean hydrogen project plan if such documentation or information is not provided by the taxpayer on or before the day that is 180 days after it was requested.

    End of inserted block
Capital cost of clean hydrogen property
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(10)For the purposes of this section, the capital cost of eligible clean hydrogen property to a taxpayer shall
  • (a)not include any amount in respect of a capital property

    • (i)for which an amount was previously deducted under this section by any person,

    • (ii)in respect of which a CTM investment tax credit (as defined in subsection 127.‍49(1)) was deducted by any person, or

    • (iii)that has, by virtue of section 21, been added to the cost of a property;

  • (b)be determined without reference to subsections 13(7.‍1) and (7.‍4);

  • (c)be reduced by the total of all amounts, each of which can reasonably be considered to be in respect of the property and is

    • (i)an amount of any government assistance or non-government assistance received by the taxpayer in or before the taxation year in which the property was acquired, or

    • (ii)an amount not described in subparagraph (i) that, in the taxation year, the taxpayer is entitled to or can reasonably be expected to receive and that would be government assistance or non-government assistance if it were received by the taxpayer in the year;

  • (d)be determined with reference to subsections 127(11.‍6) to (11.‍8) in respect of an expenditure or cost to a taxpayer except that

    • (i)the reference in subsection 127(11.‍6) to subsection 127(11.‍5) is to be read as a reference to section 127.‍48,

    • (ii)the reference in subsection 127(11.‍6) to subsection 127(26) is to be read as a reference to subsection 127.‍48(13), and

    • (iii)the term “qualified expenditure” is to be read as an expenditure eligible to be added to the capital cost of an eligible clean hydrogen property;

  • (e)not include any amount in respect of an expenditure incurred for a preliminary clean hydrogen work activity;

  • (f)if the property is dual-use electricity and heat equipment, project support equipment or equipment described in any of subparagraphs (c)‍(iv) to (vi) of the definition eligible clean hydrogen property in subsection (1), excluding equipment used all or substantially all to support a qualified clean hydrogen project, be equal to the proportion of the capital cost of the equipment that

    • (i)if the equipment is described in paragraph (a) of the definition dual-use electricity and heat equipment in subsection (1), the quantity of energy expected to be produced for use in the project over the first 20 years of the project’s operations is of the total quantity of energy expected to be produced by the equipment in that period (determined without regard to energy produced and consumed by the equipment in the process of producing energy), based on the project’s most recent clean hydrogen project plan,

    • (ii)if the equipment is described in paragraph (b) of the definition dual-use electricity and heat equipment in subsection (1) or paragraph (a) of the definition project support equipment in subsection (1), the quantity of electrical energy expected to be transmitted by the equipment for use in the project over the first 20 years of the project’s operations is of the total quantity of electrical energy expected to be transmitted by the equipment in that period (determined without regard to electrical energy consumed by the equipment in the process of transmission), based on the project’s most recent clean hydrogen project plan,

    • (iii)if the equipment is described in paragraph (b) of the definition project support equipment in subsection (1), the quantity of electrical or heat energy expected to be distributed by the equipment (or if it is equipment that expands the capacity of existing equipment, the electrical or heat energy expected to be distributed by the existing and new equipment) for use in the project over the first 20 years of the project’s operations is of the total quantity of electrical or heat energy expected to be distributed by the equipment (or the existing and new equipment) in that period (determined without regard to energy consumed by the equipment in the process of distribution), based on the project’s most recent clean hydrogen project plan,

    • (iv)if the equipment is described in paragraph (c) of the definition project support equipment in subsection (1), the mass of water expected to be supplied to the project over the first 20 years of the project’s operations is of the total mass of water expected to be processed by the equipment in that period, based on the project’s most recent clean hydrogen project plan, and

    • (v)if the equipment is described in any of subparagraphs (c)‍(iv) to (vi) of the definition eligible clean hydrogen property in subsection (1) and supports equipment described in any of subparagraphs (i) to (iv), is determined under that subparagraph; and

  • (g)after applying paragraph (f), if the property is dual-use hydrogen and ammonia equipment, dual-use electricity and heat equipment, project support equipment or equipment described in any of subparagraphs (c)‍(iv) to (vi) of the definition eligible clean hydrogen property in subsection (1) and that property is used in the production of hydrogen and ammonia, be allocated between two separate capital cost amounts, with each amount determined based on the percentage of the expected use of the equipment that is attributable to hydrogen production and ammonia production and

    • (i)the capital cost amount that is attributable to hydrogen production is deemed to be in respect of property described in paragraph (a) of the definition specified percentage in subsection (1), and

    • (ii)the capital cost amount that is attributable to ammonia production is deemed to be in respect of property described in paragraph (b) of the definition specified percentage in subsection (1).

      End of inserted block
Repayment of assistance
Start of inserted block
(11)Where a taxpayer has, in a particular taxation year, repaid (or has not received and can no longer reasonably be expected to receive) an amount of government assistance or non-government assistance that was applied to reduce the capital cost of an eligible clean hydrogen property under paragraph (10)‍(c) for a preceding taxation year, the amount repaid (or no longer expected to be received) is to be added to the cost to the taxpayer of a property acquired in the particular year for the purpose of determining the taxpayer’s clean hydrogen tax credit for the year.
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Partnerships
Start of inserted block
(12)Subject to section 127.‍491, where, in a particular taxation year of a qualifying taxpayer who is a member of a partnership, an amount would be determined under subsection (2) in respect of the partnership, for its taxation year that ends in the particular year, if the partnership were a taxable Canadian corporation and its fiscal period were its taxation year, the portion of that amount that can reasonably be considered to be the taxpayer’s share thereof shall be added in computing the clean hydrogen tax credit of the taxpayer at the end of the particular year.
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Unpaid amounts
Start of inserted block
(13)For the purposes of this section, where any part of the capital cost of a taxpayer’s eligible clean hydrogen property is unpaid on the day that is 180 days after the end of the taxation year in which a deduction in respect of a clean hydrogen tax credit would otherwise be available in respect of the property, such amount is to be
  • (a)excluded from the capital cost of the property in the year; and

  • (b)added to the capital cost of the property at the time it is paid.

    End of inserted block
Tax shelter investment
Start of inserted block
(14)Subsection (2) does not apply if an eligible clean hydrogen property – or an interest in a person or partnership that has, directly or indirectly, an interest in, or for civil law, a right in, such property – is a tax shelter investment for the purpose of section 143.‍2.
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Annual information reporting requirement
Start of inserted block
(15)If a clean hydrogen tax credit was deducted in any taxation year by a taxpayer in respect of a qualified clean hydrogen project, the taxpayer shall file, with its return of income for each taxation year that begins during the compliance period in respect of the project, a prescribed form containing prescribed information in respect of the operations of the project.
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Compliance — annual carbon intensity reporting
Start of inserted block
(16)If a clean hydrogen tax credit was deducted by a taxpayer in respect of a qualified clean hydrogen project, the taxpayer shall file with the Minister and the Minister of Natural Resources, within 180 days after the end of each operating year, a compliance report in prescribed form and manner including
  • (a)the actual carbon intensity of the hydrogen produced by the project during the year;

  • (b)the quantity, in kilograms, of hydrogen that is produced by the project during the year;

  • (c)any shutdown time of the project in respect of the year;

  • (d)for the compliance report in respect of the fifth operating year, a report that verifies the actual carbon intensity of the hydrogen produced during each operating year of the compliance period, prepared by a qualified verification firm in respect of the project; and

  • (e)any information required in guidelines published by the Minister of Natural Resources, including the Clean Hydrogen Investment Tax Credit – Validation and Verification Guidance Document.

    End of inserted block
Failure to report
Start of inserted block
(17)Each taxpayer that fails to file a compliance report for a project as described in subsection (16) is liable to a penalty, for each such failure, in an amount, not exceeding the total of all clean hydrogen tax credits deducted by the taxpayer in respect of the project, equal to the amount determined by the formula
((4% × A) ÷ 365) × B
where

A
is the total of all amounts, each of which is the amount of a clean hydrogen tax credit in respect of the project deducted by the taxpayer for a taxation year that ended before the applicable date in subsection (16); and

B
is the number of days during which the failure continues.

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Recovery — change in carbon intensity
Start of inserted block
(18)In the taxation year of a taxpayer in which the compliance period of the taxpayer’s qualified clean hydrogen project ends, if the average actual carbon intensity of the hydrogen produced is greater than the most recent expected carbon intensity that was used to determine a clean hydrogen tax credit in respect of the project, there shall be added to the taxpayer’s tax otherwise payable under this Part for the taxation year an amount equal to the total of all amounts, each of which is determined by the formula
(A − B) × C
where

A
is the specified percentage that was applied to the capital cost of the eligible clean hydrogen property forming part of the project in determining a clean hydrogen tax credit of the taxpayer;

B
is the specified percentage that would have applied to the capital cost of the property if the expected carbon intensity were equal to the average actual carbon intensity of the project; and

C
is the capital cost of the property on which the clean hydrogen tax credit was deducted.

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Minister’s determination
Start of inserted block
(19)For the purpose of subsection (18), the Minister of Natural Resources shall review each of the taxpayer’s compliance reports described in subsection (16) and the Minister may, in consultation with the Minister of Natural Resources, make a determination or redetermination of the actual carbon intensity of the hydrogen produced by a taxpayer’s clean hydrogen project for any operating year during the compliance period of the project.
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De minimis exception
Start of inserted block
(20)Subsection (18) does not apply to a taxpayer if the difference between the average actual carbon intensity of the taxpayer’s qualified clean hydrogen project and the expected carbon intensity of the project is 0.‍5 or less.
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Recapture of clean hydrogen tax credit — application
Start of inserted block
(21)Subsection (22) applies in a taxation year if
  • (a)a taxpayer acquired an eligible clean hydrogen property in the year or any of the preceding 20 calendar years;

  • (b)the taxpayer became entitled to a clean hydrogen tax credit in respect of the capital cost, or a portion of the capital cost, of the property; and

  • (c)in the year, the property is converted to a non-hydrogen or ammonia use, is exported from Canada or is disposed of without having been previously exported or converted to a non-hydrogen or ammonia use.

    End of inserted block
Recapture of clean hydrogen tax credit
Start of inserted block
(22)If this subsection applies for a taxation year in respect of an eligible clean hydrogen property, there shall be added to the taxpayer’s tax otherwise payable under this Part for the year an amount determined by the formula
(A – B) × (C ÷ D)
where

A
is the amount of the taxpayer’s clean hydrogen tax credit in respect of the property;

B
is the total of all amounts, each of which can reasonably be considered to be the portion of any amount previously paid by the taxpayer because of subsection (18) in respect of the property;

C
is an amount, not exceeding the amount determined for D, equal to

(a)if the property is disposed of to a person or partnership who deals at arm’s length with the taxpayer, the proceeds of disposition of the property, and

(b)in any other case, the fair market value of the property; and

D
is the capital cost of the property on which the clean hydrogen tax credit was deducted.

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Election — sale of clean hydrogen project
Start of inserted block
(23)If at any time a qualifying taxpayer (referred to in this subsection as the “vendor”) disposes of all or substantially all of its property comprising a qualified clean hydrogen project of the taxpayer to another taxable Canadian corporation (referred to in this subsection as the “purchaser”), and the vendor and the purchaser jointly elect in prescribed form, on or before the day that is the earliest of the days on or before which any taxpayer making the election is required to file a return of income pursuant to section 150 for the taxation year in which the transaction occurred, to have this subsection apply, the following rules apply:
  • (a)the purchaser is deemed to have acquired any eligible clean hydrogen property of the vendor at the times acquired by the vendor;

  • (b)the provisions of this Act that applied to the vendor in respect of the property that are relevant to the application of the Act in respect of the property after that time are deemed to have applied to the purchaser and, for greater certainty, the purchaser is deemed to have claimed the clean hydrogen tax credits determined under subsection (2) that could have been claimed by the vendor, before that time, in respect of the project;

  • (c)any clean hydrogen project plans that were filed by the vendor in respect of the project before that time are deemed to have been filed by the purchaser;

  • (d)the purchaser is or will be liable for amounts in respect of the property for which the vendor would be liable under this section in respect of actions, transactions or events that occur after that time as if the vendor had undertaken them or otherwise participated in them; and

  • (e)subsection (22) does not apply to the vendor in respect of the disposition of property to the purchaser.

    End of inserted block
Recapture event reporting requirement
Start of inserted block
(24)If subsection (22) applies to a taxpayer or partnership for a particular year, the taxpayer or partnership, as the case may be, shall notify the Minister in prescribed form and manner on or before the taxpayer’s filing-due date for the year or the day when a return is required by section 229 of the Income Tax Regulations to be filed in respect of the fiscal period of the partnership.
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Recovery and recapture — partnerships
Start of inserted block
(25)If subsection (12) has at any time applied to add an amount in computing the clean hydrogen tax credit of a member of a partnership, subsections (18) to (23) apply to determine amounts in respect of the partnership as if the partnership was a taxable Canadian corporation, its fiscal period were its taxation year and it had deducted all of the clean hydrogen tax credits that were previously added in computing the clean hydrogen tax credit of any member of the partnership because of the application of subsection (12) in respect of its partnership interest.
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Member’s share of recovery or recapture
Start of inserted block
(26)Unless subsection (27) applies, if, in a taxation year, a taxpayer is a member of a partnership, the amount that can reasonably be considered to be the taxpayer’s share of any amount of tax determined because of subsection (25) in respect of the partnership shall be added to the taxpayer’s tax otherwise payable under this Part for the year.
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Election by member
Start of inserted block
(27)A taxable Canadian corporation that is a member of a partnership during a fiscal period of the partnership may elect, in prescribed form and manner, to add to its tax payable under this Part for its taxation year that includes the end of the fiscal period the total amount of tax determined for a taxation year because of subsection (25) in respect of the partnership.
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Joint, several and solidary liability
Start of inserted block
(28)Each member of a partnership is jointly and severally, or solidarily, liable for any portion of the amount of tax – determined because of subsection (25) in respect of the partnership for a taxation year – that is not added to the tax payable
  • (a)of a member of the partnership under subsection (26); or

  • (b)of a taxable Canadian corporation because of subsection (27) and paid by the corporation by its filing-due date for the year.

    End of inserted block
Interest on recovery tax
Start of inserted block
(29)For the purpose of applying subsection 161(1) to an amount of tax payable because of subsection (18) (other than an amount payable because of subsection (8)), the balance-due day of a taxpayer is deemed to be the balance-due day of the taxation year for the related clean hydrogen tax credit under subsection (2).
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Credit after compliance period
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(30)For the purpose of applying subsection (2) in respect of a property acquired after the compliance period of a qualified clean hydrogen project of the taxpayer, the expected carbon intensity of the project is deemed to be the greater of the expected carbon intensity otherwise determined and the average actual carbon intensity for the compliance period of the project.
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Purpose
Start of inserted block
(31)The purpose of this section is to encourage the investment of capital in the production of clean hydrogen and clean ammonia in Canada.
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Authority of the Minister of Natural Resources
Start of inserted block
(32)For the purpose of determining whether a property is an eligible clean hydrogen property, the Clean Hydrogen Investment Tax Credit – Technical and Equipment Guidance Document published by the Department of Natural Resources is to apply conclusively with respect to engineering and scientific matters.
End of inserted block

(2)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023, except that before January 1, 2024, subsection 127.‍48(3) of the Act (as enacted by subsection (1)) is to be read without reference to section 127.‍49 and subsection 127.‍48(10) of the Act (as enacted by subsection (1)) is to be read without reference to its subparagraph (a)‍(ii).

38(1)The Act is amended by adding the following after section 127.‍48, as enacted by subsection 37(1):

Definitions
Start of inserted block
127.‍49(1)The following definitions apply in this section.

CTM investment tax credit of a qualifying taxpayer for a taxation year means  

  • (a)the total of all amounts each of which is the specified percentage of the capital cost to the taxpayer of CTM property acquired by the taxpayer in the year for a CTM use; and

  • (b)the total of all amounts required by subsection (8) to be added in computing the taxpayer’s CTM investment tax credit at the end of the year.‍ (crédit d’impôt à l’investissement pour la FTP)

CTM property means property of a taxpayer, other than excluded property,

  • (a)situated in Canada and intended for use exclusively in Canada;

  • (b)that has not been used, or acquired for use or lease, for any purpose whatever before it was acquired by the taxpayer;

  • (c)that, if it is to be leased by the taxpayer to another person or a partnership, is

    • (i)leased to a qualifying taxpayer or a partnership all the members of which are qualifying taxpayers, and

    • (ii)leased in the ordinary course of carrying on a business in Canada by the taxpayer whose principal business is selling or servicing property of that type, or whose principal business is leasing property, lending money, purchasing conditional sales contracts, accounts receivable, bills of sale, chattel mortgages or hypothecary claims on movables, bills of exchange or other obligations representing all or part of the sale price of merchandise or services, or any combination thereof; and

  • (d)described in Schedule II to the Income Tax Regulations that

    • (i)is included in

      • (A)paragraph (a) or (c) of Class 8,

      • (B)paragraph (a) of Class 43,

      • (C)Class 43.‍1 that would otherwise be included in any of clauses (A), (B) and (E),

      • (D)Class 43.‍2 that would otherwise be included in clause (C), or

      • (E)Class 53,

    • (ii)is included in

      • (A)paragraph (b) of Class 8, or would be included in paragraph (b) of Class 8 if that paragraph were read without reference to the word “solely” and if the word “building” were read as “structure”,

      • (B)Class 43.‍1 that would otherwise be included in clause (A), or

      • (C)Class 43.‍2 that would otherwise be included in clause (B),

    • (iii)is included in

      • (A)subparagraph (k)‍(i) of Class 10, provided that the property would otherwise be in paragraph (a) or (c) of Class 8,

      • (B)subparagraph (k)‍(ii) of Class 10,

      • (C)paragraph (b) of Class 41, or in paragraph (b) of Class 41.‍2, that would otherwise be included in clauses (A) or (B),

      • (D)paragraph (b) of Class 43,

      • (E)Class 43.‍1 that would otherwise be included in any of clauses (A) to (D), or

      • (F)Class 43.‍2 that would otherwise be included in clause (E),

    • (iv)is included in paragraph (d) or (j) of Class 12,

    • (v)is included in

      • (A)paragraph (a) or (e) of Class 10 or Class 38, but excluding any property that is designed or adapted for use on streets and highways, or

      • (B)Class 56, or

    • (vi)would be described in any of subparagraphs (i) to (v) if the word “mine” in Schedule II of the Income Tax Regulations were read as “mine, well or tailing pond”. (bien de FTP)

CTM use means the use of a property

  • (a)all or substantially all for activities described in paragraph (a) or (c) of the definition qualified zero-emission technology manufacturing activities in section 5202 of the Income Tax Regulations; or

  • (b)in a qualifying mineral activity producing all or substantially all qualifying materials.‍ (utilisation pour la FTP)

excluded property means any property used in the production of battery cells or modules if the production has benefitted from, or can reasonably be expected to benefit from, support under a contribution agreement with the Government of Canada referred to in paragraph 7300(e) of the Income Tax Regulations.‍ (bien exclu)

government assistance has the same meaning as in subsection 127(9).‍ (aide gouvernementale)

non-CTM use means a use of a property other than a CTM use.‍ (utilisation autre que pour la FTP)

non-government assistance has the same meaning as in subsection 127(9).‍ (aide non gouvernementale)

permitted element means hydrogen, carbon, nitrogen, oxygen, phosphorus, sulfur, selenium, sodium, potassium, a halogen or a noble gas.‍ (élément autorisé)

qualifying material means 

  • (a)lithium;

  • (b)cobalt;

  • (c)nickel;

  • (d)copper;

  • (e)rare earth elements; and

  • (f)graphite.‍ (matériau admissible)

qualifying mineral activity means  

  • (a)the extraction of resources from a mineral deposit or from a tailing pond;

  • (b)a mineral processing activity, including crushing, grinding, milling, separation, sieving, screening, froth floatation, leaching, recrystallization, precipitation, drying, evaporation, heating, calcinating, roasting, smelting, casting of ingots, refining, purification, distillation, electrodeposition and surface roughening of electrodeposited foil, that

    • (i)is performed at a mine site, well site, tailing pond, mill, smelter or refinery, and

    • (ii)occurs prior to or as part of a process intended

      • (A)to increase the purity of at least one qualifying material, or

      • (B)to produce a material with non-trace amounts of a single qualifying material, and without non-trace amounts of any elements other than permitted elements;

  • (c)a recycling activity that is

    • (i)sorting, disassembly or shredding of a recyclable material, or

    • (ii)a material processing activity substantially similar to an activity described in paragraph (b) if that paragraph were read without reference to its subparagraph (i);

  • (d)a synthetic graphite activity that is

    • (i)performed during or after the graphitization stage, and

    • (ii)a material processing activity substantially similar to an activity described in paragraph (b) if that paragraph were read without reference to its subparagraph (i); or

  • (e)spheronization of graphite or coating of spheronized graphite.‍ (activité minière admissible)

qualifying taxpayer means a taxable Canadian corporation.‍ (contribuable admissible)

specified percentage means in respect of a CTM property of the taxpayer that is acquired

  • (a)before January 1, 2024, determined without reference to subsection (4), nil;

  • (b)after December 31, 2023 and before January 1, 2032, 30%;

  • (c)after December 31, 2031 and before January 1, 2033, 20%;

  • (d)after December 31, 2032 and before January 1, 2034, 10%;

  • (e)after December 31, 2033 and before January 1, 2035, 5%; and

  • (f)after December 31, 2034, nil.‍ (pourcentage déterminé)

    End of inserted block
CTM investment tax credit
Start of inserted block
(2)If a qualifying taxpayer files with its return of income for a taxation year a prescribed form containing prescribed information, the taxpayer is deemed to have paid on its balance-due day for the year an amount on account of the taxpayer’s tax payable under this Part for the year equal to the taxpayer’s CTM investment tax credit for the year.
End of inserted block
Time limit for application
Start of inserted block
(3)A payment on account of tax payable shall not be deemed to be paid under subsection (2) if the taxpayer does not file with the Minister a prescribed form containing prescribed information in respect of the amount on or before the day that is one year after the taxpayer’s filing-due date for the year and, if the prescribed form is filed after the taxpayer’s filing-due date for the year, no payment is deemed to arise under that subsection until the prescribed form containing the prescribed information has been filed with the Minister.
End of inserted block
Time of acquisition
Start of inserted block
(4)For the purpose of this section, CTM property is deemed not to have been acquired by a taxpayer before the property is considered to have become available for use by the taxpayer, determined without reference to paragraphs 13(27)‍(c) and (28)‍(d).
End of inserted block
Special rules — adjustments
Start of inserted block
(5)For the purpose of this section, the capital cost of CTM property to a taxpayer shall
  • (a)not include any amount in respect of a capital property

    • (i)for which an amount was previously deducted under this section by any person,

    • (ii)in respect of which a clean hydrogen tax credit (as defined in subsection 127.‍48(1)) was deducted by any person, or

    • (iii)that has, by virtue of section 21, been added to the cost of a property;

  • (b)be determined without reference to subsections 13(7.‍1) and (7.‍4);

  • (c)be reduced by the total of all amounts, each of which can reasonably be considered to be in respect of the property and is

    • (i)an amount of any government assistance or non-government assistance received by the taxpayer in or before the taxation year in which the property was acquired, or

    • (ii)an amount not described in subparagraph (i) that, in the taxation year, the taxpayer is entitled to or can reasonably be expected to receive and that would be government assistance or non-government assistance if it were received by the taxpayer; and

  • (d)be determined with reference to subsections 127(11.‍6) to (11.‍8) in respect of an expenditure or cost to a taxpayer except that

    • (i)the reference in subsection 127(11.‍6) to subsection 127(11.‍5) is to be read as a reference to section 127.‍49,

    • (ii)the reference in subsection 127(11.‍6) to subsection 127(26) is to be read as a reference to subsection 127.‍49(9), and

    • (iii)the term “qualified expenditure” is to be read as an expenditure eligible to be added to the capital cost of a CTM property.

      End of inserted block
Deemed deduction
Start of inserted block
(6)For the purpose of this section, paragraph 12(1)‍(t), subsection 13(7.‍1), the description of I in the definition undepreciated capital cost in subsection 13(21), subsection 53(2) and sections 127.‍48 and 129, the amount deemed under subsection (2) to have been paid by a taxpayer for a taxation year is deemed to have been deducted from the taxpayer’s tax otherwise payable under this Part for the year.
End of inserted block
Repayment of assistance
Start of inserted block
(7)Where a taxpayer has, in a particular taxation year, repaid (or has not received and can no longer reasonably be expected to receive) an amount of government assistance or non-government assistance that was applied to reduce the cost of a property under paragraph (5)‍(c) for a preceding taxation year, the amount repaid (or no longer expected to be received) is to be added to the cost to the taxpayer of a property acquired in the particular year for the purpose of determining the taxpayer’s CTM investment tax credit for the year.
End of inserted block
Partnerships
Start of inserted block
(8)Subject to section 127.‍491, where, in a particular taxation year of a qualifying taxpayer that is a member of a partnership, an amount would be determined under subsection (2) in respect of the partnership, for its taxation year that ends in the particular year, if the partnership were a qualifying taxpayer and its fiscal period were its taxation year, the portion of that amount that can reasonably be considered to be the taxpayer’s share thereof shall be added in computing the CTM investment tax credit of the taxpayer at the end of the particular year.
End of inserted block
Unpaid amounts
Start of inserted block
(9)For the purpose of this section, where any part of the capital cost of a taxpayer’s CTM property is unpaid on the day that is 180 days after the end of the taxation year in which a deduction in respect of a CTM investment tax credit would otherwise be available in respect of the property, such amount is to be
  • (a)excluded from the capital cost of such property in the year; and

  • (b)added to the capital cost of such property at the time it is paid.

    End of inserted block
Tax shelter investment
Start of inserted block
(10)Subsection (2) does not apply if a CTM property – or an interest in a person or partnership that has, directly or indirectly, an interest in, or for civil law, a right in, such property – is a tax shelter investment for the purpose of section 143.‍2.
End of inserted block
Recapture — conditions for application
Start of inserted block
(11)Subsection (12) applies in a taxation year if
  • (a)a taxpayer acquired a CTM property in the year or any of the preceding 10 calendar years;

  • (b)the taxpayer became entitled to a CTM investment tax credit in respect of the capital cost, or a portion of the capital cost, of the property; and

  • (c)in the year, the property (or another property that incorporates the property) is converted to a non-CTM use, is exported from Canada or is disposed of without having been previously exported or converted to a non-CTM use.

    End of inserted block
Recapture of credit
Start of inserted block
(12)If this subsection applies, there shall be added to the taxpayer’s tax otherwise payable under this Part for the year the lesser of
  • (a)the amount of the taxpayer’s CTM investment tax credit in respect of the property, and

  • (b)the amount determined by the formula

    A × (B ÷ C)
    where

    A
    is the amount of the taxpayer’s CTM investment tax credit in respect of the property,

    B
    is

    (i)in the case where the property is disposed of to a person or partnership who deals at arm’s length with the taxpayer, the proceeds of disposition of the property, or

    (ii)in the case where the property is disposed of to a person or partnership who does not deal at arm’s length with the taxpayer, is converted to a non-CTM use or is exported from Canada, the fair market value of the property, and

    C
    is the capital cost of the property on which the CTM investment tax credit was deducted.

    End of inserted block
Certain non-arm’s length transfers
Start of inserted block
(13)Subsections (11) and (12) do not apply to a taxpayer (in this subsection referred to as the “transferor”) that disposes of a property to a qualifying taxpayer (in this subsection referred to as the “purchaser”) related to the transferor, if the purchaser acquired the property in circumstances where the property would be CTM property to the purchaser (but for paragraph (b) of the definition CTM property in subsection (1)) and is used by the purchaser for a CTM use.
End of inserted block
Certain non-arm’s length transfers — recapture deferred
Start of inserted block
(14)If subsections (11) and (12) do not apply because of subsection (13), subsection 127(34) applies with such modifications as the circumstances require, including that the reference to subsection 127(33) be read as subsection 127.‍49(13).
End of inserted block
Recapture event reporting requirement
Start of inserted block
(15)If subsection (12) or (13) applies to a taxpayer for a taxation year, the taxpayer shall notify the Minister in prescribed form and manner on or before the taxpayer’s filing-due date for the year.
End of inserted block
Recapture of credit for partnerships
Start of inserted block
(16)Subsection (17) applies in a fiscal period of a partnership if
  • (a)the partnership acquired a CTM property in the fiscal period or in any of the 10 preceding calendar years;

  • (b)the cost, or a portion of the cost, of the property is included in an amount, a percentage of which can reasonably be considered to have been included in computing the amount determined under subsection (8) in respect of the partnership at the end of a fiscal period; and

  • (c)in the fiscal period, the property (or another property that incorporates the property) is converted to a non-CTM use, is exported from Canada or is disposed of without having been previously exported or converted to a non-CTM use.

    End of inserted block
Addition to tax
Start of inserted block
(17)If this subsection applies to a fiscal period of a partnership, where a taxpayer is a member of the partnership during the fiscal period, there shall be added to the taxpayer’s tax otherwise payable under this Part for the taxpayer’s taxation year in which the fiscal period ends the amount that can reasonably be considered to be the taxpayer’s share of the amount, if any, equal to the lesser of
  • (a)the amount that can reasonably be considered to have been included in respect of the property in computing the amount determined under subsection (8) in respect of the partnership, and

  • (b)the percentage described in paragraph (16)‍(b) of

    • (i)where the property (or the other property) is disposed of to a person who deals at arm’s length with the partnership, the proceeds of disposition of the property, and

    • (ii)in any other case, the fair market value of the property (or the other property) at the time of the conversion, export or disposition.

      End of inserted block
Information return — partnerships
Start of inserted block
(18)If subsections (16) and (17) apply with respect to the property of a partnership for a fiscal period, the partnership shall notify the Minister in prescribed form and manner on or before the day when a return is required by section 229 of the Income Tax Regulations to be filed in respect of the period.
End of inserted block
CTM investment tax credit — purpose
Start of inserted block
(19)The purpose of this section is to encourage the investment of capital in Canada for a CTM use.
End of inserted block

(2)Subsection (1) is deemed to have come into force on January 1, 2024.

39(1)The Act is amended by adding the following after section 127.‍49, as enacted by subsection 38(1):

Definitions
Start of inserted block
127.‍491(1)The following definitions apply in this section.

at-risk amount has the meaning assigned by subsection 96(2.‍2).‍ (fraction à risques)

clean economy allocation provision means

  • (a)subsection 127.‍48(12); or

  • (b)subsection 127.‍49(8).‍ (disposition d’allocation pour l’économie propre)

clean economy expenditure means

  • (a)the capital cost of eligible clean hydrogen property as determined under section 127.‍48; or

  • (b)the capital cost of CTM property as determined under section 127.‍49.‍ (dépense pour l’économie propre)

clean economy provision means

  • (a)this section;

  • (b)section 127.‍48; or

  • (c)section 127.‍49.‍ (disposition pour l’économie propre)

clean economy tax credit means

  • (a)a clean hydrogen tax credit (as defined under section 127.‍48(1)); or

  • (b)a CTM investment tax credit (as defined under section 127.‍49(1)).‍ (crédit d’impôt pour l’économie propre)

limited partner has the meaning assigned by subsection 96(2.‍4) if that subsection were read without reference to “if the member’s partnership interest is not an exempt interest (within the meaning assigned by subsection (2.‍5)) at that time and”.‍ (commanditaire)

End of inserted block
Credits in unreasonable proportions
Start of inserted block
(2)If the members of a partnership agree to share the amount of a clean economy tax credit of the partnership and the share of any member of that amount is not reasonable in the circumstances having regard to the capital invested in or work performed for the partnership by the members of the partnership or such other factors as may be relevant, that share shall, notwithstanding any agreement, be deemed to be the amount that is reasonable in the circumstances.
End of inserted block
Limited partners
Start of inserted block
(3)Notwithstanding subsection (2), if a taxpayer is a limited partner of a partnership at the end of a fiscal period of the partnership, the total of all clean economy tax credits allocated to the taxpayer by the partnership in respect of that fiscal period shall not exceed the taxpayer’s at-risk amount in respect of the partnership at the end of that fiscal period.
End of inserted block
Apportionment rule
Start of inserted block
(4)The amount required by any clean economy allocation provision to be added in computing a particular clean economy tax credit of a taxpayer in respect of a partnership for the taxation year in which the partnership’s fiscal period ends is deemed to be the portion of the amount otherwise determined under this section in respect of the taxpayer that is reasonably attributable to each particular clean economy tax credit.
End of inserted block
Assistance received by member of partnership
Start of inserted block
(5)For the purposes of computing a clean economy tax credit, if, at a particular time, a taxpayer that is a member of a partnership has received, is entitled to receive or can reasonably be expected to receive government assistance or non-government assistance (as defined in subsection 127(9)), the amount of that assistance that may reasonably be considered to be in respect of a clean economy expenditure of the partnership shall be deemed to have been received at that time by the partnership as government assistance or non-government assistance, as the case may be, in respect of the expenditure.
End of inserted block
Credit received by member of partnership
Start of inserted block
(6)For the purposes of subsection 13(7.‍1), if, pursuant to an allocation from a partnership under a clean economy allocation provision, an amount is added in computing a clean economy tax credit of a taxpayer at the end of the taxpayer’s taxation year, the amount shall be deemed to have been received by the partnership at the end of its fiscal period in respect of which the allocation was made as assistance from a government for the acquisition of depreciable property.
End of inserted block
Tiered partnerships
Start of inserted block
(7)For the purposes of each clean economy provision, a person or partnership that is (or is deemed by this subsection to be) a member of a particular partnership that is a member of another partnership is deemed to be a member of the other partnership.
End of inserted block

(2)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023, except that before January 2024, the definitions clean economy allocation provision, clean economy expenditure, clean economy provision and clean economy tax credit in subsection 127.‍491(1) of the Act, as enacted by subsection (1), are to be read as follows:

clean economy allocation provision means subsection 127.‍48(12).‍ (disposition d’allocation pour l’économie propre)

clean economy expenditure means a capital cost of eligible clean hydrogen property as determined under section 127.‍48.‍ (dépense pour l’économie propre)

clean economy provision means

  • (a)this section; or

  • (b)section 127.‍48.‍ (disposition pour l’économie propre)

clean economy tax credit means a clean hydrogen tax credit (as defined under section 127.‍48(1)).‍ (crédit d’impôt pour l’économie propre)

40(1)The description of A in section 127.‍51 of the Act is replaced by the following:

A
is Insertion start 20.‍5% Insertion end ;

(2)Paragraph (a) of the description of C in section 127.‍51 of the Act is replaced by the following:

Start of inserted block

(a)the first dollar amount for the year referred to in paragraph 117(2)‍(d), in the case of an individual (other than a trust) or a qualified disability trust (as defined in subsection 122(3)); and

End of inserted block

(3)Subsections (1) and (2) apply to taxation years that begin after December 31, 2023.

41(1)Subparagraph 127.‍52(1)‍(d)‍(i) of the Act is replaced by the following:

  • (i)the references to the fraction applicable to the individual for the year in each of paragraphs 38(a) and (b) and section 41 were read as a reference to “ Insertion start 1/1 Insertion end ”, and

(2)The formula in subparagraph 127.‍52(1)‍(d)‍(ii) of the Act is replaced by the following:

A ÷ B

(3)Subsection 127.‍52(1) of the Act is amended by adding the following after paragraph (d):

  • Start of inserted block

    (d.‍1)in respect of a disposition to which paragraph 38(a.‍1) applies, the portion of that paragraph before subparagraph (i) were read as “a taxpayer’s taxable capital gain for a taxation year from the disposition of a property is equal to 3/10 of the taxpayer’s capital gain for the year from the disposition of the property if”;

    End of inserted block

(4)The portion of subparagraph 127.‍52(1)‍(g)‍(ii) of the Act before clause (A) is replaced by the following:

  • (ii)the total of all amounts each of which is

(5)Clause 127.‍52(1)‍(g)‍(ii)‍(A) of the French version of the Act is replaced by the following:

  • (A)un montant attribué par la fiducie en application du paragraphe 104(21) pour l’année,

(6)The portion of clause 127.‍52(1)‍(g)‍(ii)‍(B) of the French version of the Act before subclause (I) is replaced by the following:

  • (B)la partie d’un gain en capital imposable net de la fiducie qu’il est raisonnable de considérer :

(7)Subparagraphs 127.‍52(1)‍(h)‍(i) to (vi) of the Act are replaced by the following:

  • Start of inserted block

    (i)the amounts deducted under subsection 110(2),

    End of inserted block
  • (ii) Insertion start 7/5 of Insertion end the amounts deducted under any of paragraph 110(1)‍(d.‍01) and subsections 110.‍6(2) and (2.‍1),

  • Start of inserted block

    (iii)the amount that would be deductible under paragraph 110(1)‍(f) if the individual deducted 1/2 of the amount the individual deducted for the year under subparagraph 110(1)‍(f)‍(v),

  • (iv)1/2 of the amount deducted for the year under subsection 110.‍7(1), and

    End of inserted block
  • (v)the amount deducted under paragraph 110(1)‍(g);

(8)Clause 127.‍52(1)‍(i)‍(i)‍(A) of the Act is replaced by the following:

  • (A) Insertion start 1/2 of all amounts Insertion end deducted for the year under paragraphs Insertion start 111(1)‍(a), (c), (d) and (e) Insertion end , and

(9)The portion of clause 127.‍52(1)‍(i)‍(i)‍(B) of the English version of the Act before subclause (I) is replaced by the following:

  • Start of inserted block

    (B)the total of all amounts that would be deductible under those paragraphs for the year if the amount that would be deductible under paragraphs 111(1)‍(a), (c), (d) and (e) was 1/2 of the amount that would otherwise be deductible under those paragraphs and if

    End of inserted block

(10)Clause 127.‍52(1)‍(i)‍(ii)‍(A) of the Act is replaced by the following:

  • (A)the total of all amounts deducted under paragraph 111(1)‍(b), and

(11)Clause 127.‍52(1)‍(i)‍(ii)‍(B) of the Act is amended by striking out “and” at the end of subclause (II) and by replacing subclause (III) with the following:

  • (III)paragraphs (c.‍1) and (d) of this subsection applied in computing the individual’s net capital loss for any taxation year that ends after 2011 Insertion start and begins before 2024, and Insertion end

  • Start of inserted block

    (IV)paragraph (c.‍1) of this subsection applied in computing the individual’s net capital loss for any taxation year that begins after 2023; and

    End of inserted block

(12)Paragraph 127.‍52(1)‍(j) of the Act is replaced by the following:

  • Start of inserted block

    (j)in computing the individual’s income for the year, the individual deducted 1/2 of the amount deducted for the year under

    • (i)paragraphs 8(1)‍(c) to (e), (g) to (l.‍2) and (p) to (t),

    • (ii)paragraphs 20(1)‍(c) to (f) in respect of an amount borrowed to earn income from property for the year, other than an amount described under any of paragraphs (b), (c), (c.‍2), (c.‍3) and (e.‍1),

    • (iii)paragraphs 60(e), (e.‍1) and (g),

    • (iv)subsections 62(1) and (2),

    • (v)subsections 63(1) and (2.‍2), and

    • (vi)section 64.

      End of inserted block

(13)Subsections (1) to (12) apply to taxation years that begin after December 31, 2023.

42(1)Paragraphs 127.‍531(a) and (b) of the Act are replaced by the following:
  • (a) Insertion start 1/2 of Insertion end an amount deducted under any of subsections 118(1), (2), Insertion start (3) Insertion end and (10), sections 118.‍01 to 118.‍07, Insertion start subsections Insertion end 118.‍3(1), Insertion start (2) and (3) Insertion end and sections 118.‍5 to Insertion start 118.‍9 Insertion end in computing the individual’s tax payable for the year under this Part;

  • (b) Insertion start 1/2 of Insertion end the amount that was claimed under section 118.‍2 in computing the individual’s tax payable for the year under this Part, determined without reference to this Division, to the extent that the amount claimed does not exceed the maximum amount deductible under that section in computing the individual’s tax payable for the year under this Part, determined without reference to this Division;

  • Start of inserted block

    (c)4/5 of the amount that was claimed under section 118.‍1 in computing the individual’s tax payable for the year under this Part, determined without reference to this Division, to the extent that the amount claimed does not exceed the maximum amount deductible under that section in computing the individual’s tax payable for the year under this Part, determined without reference to this Division; and

  • (d)an amount deducted under section 119 or subsection 127(1) in computing the individual’s tax payable for the year under this Part.

    End of inserted block

(2)Subsection (1) applies to taxation years that begin after December 31, 2023.

43(1)The definition foreign taxes in subsection 127.‍54(1) of the English version of the Act is replaced by the following:

foreign taxes of an individual for a taxation year means the total of the business-income taxes, Insertion start as defined in Insertion end subsection 126(7), paid by the individual for the year in respect of businesses carried on by the individual in countries other than Canada and 2/3 of the non-business-income taxes, Insertion start as defined in Insertion end that subsection, paid by the individual for the year to the governments of countries other than Canada.‍ (impôts payés à l’étranger)

(2)Paragraph (b) of the definition foreign income in subsection 127.‍54(1) of the Act is replaced by the following:

  • (b)the individual’s incomes for the year ( Insertion start as would be determined if paragraph 127.‍52(1)‍(d) were applicable Insertion end ) from sources in countries other than Canada in respect of which the individual has paid non-business-income taxes, Insertion start as defined in Insertion end subsection 126(7), to governments of countries other than Canada; (revenu de source étrangère )

(3)The description of A in subparagraph 127.‍54(2)‍(b)‍(ii) of the Act is replaced by the following:

A
is Insertion start 20.‍5% Insertion end , and

(4)Subsections (2) and (3) apply to taxation years that begin after December 31, 2023.

44(1)Paragraph 127.‍55(f) of the Act is replaced by the following:

  • (f)a taxation year of a trust throughout which the trust is

    • Start of inserted block

      (i)a trust referred to in paragraph 150(1.‍2)‍(f), (g), (i), (j), (l) or (n),

    • (ii)an investment fund (as defined in subsection 251.‍2(1)) unless the trust qualifies as an investment fund because of or in connection with a transaction or event or series of transactions or events one of the main purposes of which is to avoid tax under this Division,

    • (iii)a trust

      • (A)all of the beneficiaries of which are any combination of

        • (I)persons exempt from tax under this Division, and

        • (II)trusts described in this subparagraph,

      • (B)under which no person (other than a person described in subclause (A)‍(I) or (II)) can be added as a beneficiary,

      • (C)in which all interests are fixed interests (as defined in subsection 94(1)), and

      • (D)that is irrevocable,

    • (iv)a trust that is exempt from tax under this Part,

    • (v)a trust described in subsection 143(1), or

    • (vi)a unit trust if the total fair market value of the units of the trust that are listed on a designated stock exchange represents all or substantially all of the total fair market value of all the units of the trust.

      End of inserted block

(2)Subsection (1) applies to taxation years that begin after December 31, 2023.

45(1)Subparagraph (g)‍(i) of the definition excluded right or interest in subsection 128.‍1(10) of the English version of the Act is replaced by the following:

  • (i)the Canada Pension Plan or a provincial Insertion start pension Insertion end plan Insertion start as defined Insertion end in section 3 of that Act,

(2)Subsection (1) is deemed to have come into force on August 4, 2023.

46(1)The definition eligible refundable dividend tax on hand in subsection 129(4) of the Act is amended by striking out “and” at the end of subparagraph (a)‍(i) and by adding the following after subparagraph (a)‍(ii):

  • Start of inserted block

    (iii)eligible dividends received by the particular corporation in a taxation year that began after 2018 from corporations (referred to in this subparagraph as “payer corporations”) that are connected with the particular corporation to the extent that such dividends

    • (A)caused a dividend refund to those payer corporations from their refundable dividend tax on hand at the end of their first taxation year that ended after 2018, and

    • (B)are not otherwise included in determining the particular corporation’s eligible refundable dividend tax on hand, and

      End of inserted block

(2)Subsection (1) applies to taxation years beginning after 2018.

47(1)Subsection 131(4.‍1) of the Act is amended by striking out “or” at the end of paragraph (a), by adding “or” at the end of paragraph (b) and by adding the following after paragraph (b):

  • Start of inserted block

    (c)if the old share and the new share are not shares of the same class but are shares of Capital régional et coopératif Desjardins,

  • (i)the old share and the new share derive their value in the same proportion from the same property or group of properties, and

  • (ii)the shares are recognized under securities legislation as or as part of the same investment fund.

    End of inserted block

(2)Subsection (1) applies to the exchange or other disposition of a share on or after October 25, 2018.

48(1)Subparagraph (a)‍(ii) of the definition revenu gagné in subsection 146(1) of the French version of the Act is replaced by the following:

  • (ii)d’une entreprise qu’il exploite Insertion start soit Insertion end seul, Insertion start soit Insertion end comme associé Insertion start participant Insertion end activement Insertion start à l’exploitation de l’entreprise Insertion end ,

(2)Paragraph (c) of the definition revenu gagné in subsection 146(1) of the French version of the Act is replaced by the following:

  • c)soit son revenu, sauf un montant visé à l’alinéa 12(1)z), pour une période de l’année tout au long de laquelle il ne résidait pas au Canada tiré, selon le cas, des fonctions d’une charge ou d’un emploi qu’il remplit au Canada, compte non tenu des alinéas 8(1)c), m) et m.‍2), ou d’une entreprise qu’il exploite au Canada, Insertion start soit Insertion end seul, Insertion start soit Insertion end comme associé Insertion start participant Insertion end activement Insertion start à l’exploitation de l’entreprise Insertion end , sauf dans la mesure où ce revenu est exonéré de l’impôt sur le revenu au Canada par l’effet d’une disposition d’un accord ou convention fiscal conclu avec un autre pays et ayant force de loi au Canada;

(3)Subparagraph (e)‍(i) of the definition revenu gagné in subsection 146(1) of the French version of the Act is replaced by the following:

  • (i)d’une entreprise qu’il exploite Insertion start soit Insertion end seul, Insertion start soit Insertion end comme associé Insertion start participant Insertion end activement Insertion start à l’exploitation de l’entreprise Insertion end ,

(4)Paragraph (g) of the definition revenu gagné in subsection 146(1) of the French version of the Act is replaced by the following:

  • g)soit sa perte pour une période de l’année tout au long de laquelle il n’a pas résidé au Canada, provenant d’une entreprise qu’il exploite au Canada, Insertion start soit Insertion end seul, Insertion start soit Insertion end comme associé Insertion start participant Insertion end activement Insertion start à l’exploitation de l’entreprise Insertion end ;

(5)Subsection 146(8.‍1) of the Act is replaced by the following:

Deemed receipt of refund of premiums
(8.‍1)An individual and the legal representative of a deceased annuitant Insertion start of Insertion end a registered retirement savings plan Insertion start may Insertion end jointly Insertion start designate Insertion end in prescribed form filed with the Minister Insertion start that all or a portion of Insertion end a payment Insertion start made Insertion end out of or under the plan to the legal representative is deemed to Insertion start have been Insertion end received by the individual at the time it was so paid as a benefit that is a refund of premiums, and not Insertion start to have been paid Insertion end to the legal representative, if
  • Start of inserted block

    (a)a payment not less than the designated amount is made from the estate of the deceased annuitant to the individual who is entitled to receive the payment

    End of inserted block
    • Insertion start (i) Insertion end Insertion start Insertion end Insertion start as Insertion end a beneficiary (as defined in subsection 108(1)) under the estate, Insertion start or Insertion end

    • Start of inserted block

      (ii)under a decree, order or judgment of a competent tribunal or under a written agreement, relating to the rights or interests of a spouse or common-law partner in respect of property as a result of marriage or common-law partnership; and

      End of inserted block
  • Insertion start (b) Insertion end the designated Insertion start amount Insertion end would have been a refund of premiums if it had been paid to Insertion start the Insertion end individual Insertion start directly from the registered retirement savings plan Insertion end .

(6)The portion of subsection 146(8.‍93) of the French version of the Act before paragraph (a) is replaced by the following:

Application du paragraphe (8.‍92)
(8.‍93)À moins que le ministre n’ait renoncé par écrit à appliquer le présent paragraphe à l’égard de tout ou partie de la somme déterminée selon le paragraphe (8.‍92) relativement à un régime enregistré d’épargne-retraite, ce paragraphe ne s’applique pas dans Insertion start l’une des Insertion end circonstances suivantes :

(7)The portion of subsection 146(16) of the French version of the Act before paragraph (d) is replaced by the following:

Transfert de biens
(16)Malgré les autres dispositions du présent article, un régime enregistré d’épargne-retraite peut, à un moment donné, être révisé ou modifié de façon à prévoir le versement ou le transfert, avant son échéance, par l’émetteur de biens accumulés pour le compte du rentier du régime ( Insertion start appelé « cédant » au présent paragraphe Insertion end ) :
  • a)soit à un régime de pension agréé, au profit du Insertion start cédant Insertion end , ou à un régime enregistré d’épargne-retraite ou un fonds enregistré de revenu de retraite dont le Insertion start cédant Insertion end est rentier;

  • a.‍1)soit à un fournisseur de rentes autorisé afin d’acquérir une rente viagère différée à un âge avancé au profit du Insertion start cédant Insertion end ;

  • b)soit à un régime enregistré d’épargne-retraite ou un fonds enregistré de revenu de retraite dont l’époux ou le conjoint de fait ou l’ex-époux ou ancien conjoint de fait du Insertion start cédant Insertion end est rentier, si le Insertion start cédant Insertion end et son époux ou conjoint de fait ou ex-époux ou ancien conjoint de fait vivent séparément et si le versement ou le transfert est effectué en vertu d’une ordonnance ou d’un jugement rendus par un tribunal compétent ou en vertu d’un accord écrit de séparation, visant à partager des biens entre le Insertion start cédant Insertion end et son époux ou conjoint de fait ou ex-époux ou ancien conjoint de fait, en règlement des droits découlant du mariage ou de l’union de fait ou de son échec.

Dans le cas où un tel versement ou transfert est effectué pour le compte du Insertion start cédant Insertion end avant l’échéance du régime, les règles suivantes s’appliquent :

  • c)le montant du versement ou du transfert ne peut, en raison seulement du versement ou du transfert, être inclus dans le calcul du revenu du Insertion start cédant Insertion end ou de son époux ou conjoint de fait ou ex-époux ou ancien conjoint de fait;

(8)Subsection 146(21.‍2) of the Act is replaced by the following:

Specified pension plan — account
(21.‍2)For the purposes of paragraph (8.‍2)‍(b), subsection (8.‍21), paragraphs (16)‍(a) and (b) and 18(1)‍(u), Insertion start section 60.‍011 Insertion end , subparagraph (a)‍(i) of the definition excluded right or interest in subsection 128.‍1(10), paragraph (b) of the definition excluded premium in subsection 146.‍01(1), paragraph (c) of the definition excluded premium in subsection 146.‍02(1), subsections 146.‍3(14) and 147(19), section 147.‍3 and paragraphs 147.‍5(21)‍(c) and 212(1)‍(j.‍1) and (m) and for the purposes of any regulations made under subsection 147.‍1(18), an individual’s account under a specified pension plan is deemed to be a registered retirement savings plan under which the individual is the annuitant.

(9)Subsection (5) is deemed to have come into force on January 1, 2020.

(10)Subsection (8) is deemed to have come into force on August 4, 2023.

49(1)Paragraph (h) of the definition regular eligible amount in subsection 146.‍01(1) of the Act is replaced by the following:

  • (h)the total of the amount and all other eligible amounts received by the individual in the calendar year that includes the particular time does not exceed $ Insertion start 60,000 Insertion end , and

(2)Paragraph (g) of the definition supplemental eligible amount in subsection 146.‍01(1) of the Act is replaced by the following:

  • (g)the total of the amount and all other eligible amounts received by the individual in the calendar year that includes the particular time does not exceed $ Insertion start 60,000 Insertion end , and

(3)The portion of subsection 146.‍01(4) of the Act before the formula is replaced by the following:

Portion of eligible amount not repaid
(4) Insertion start Subject to subsection (4.‍1) Insertion end , there shall be included in computing an individual’s income for a particular taxation year included in a particular participation period of the individual the amount determined by the formula

(4)Section 146.‍01 of the Act is amended by adding the following after subsection (4):

Temporary repayment relief — application
Start of inserted block
(4.‍1)If the completion date in respect of an eligible amount received by an individual is after 2022 and before 2027
  • (a)subparagraphs (a)‍(i) and (ii) of the description of A in subsection (4) are to be read as follows:

    “(i)the individual died or ceased to be resident in Canada in the particular year,

    (ii)the completion date in respect of an eligible amount received by the individual was in the particular year, or

    (iii)subsection (4.‍2) applies to the particular year and to an eligible amount received by the individual”;

  • (b)paragraph (a) of the description of B in subsection (4) is to be read as follows:

    “(a)nil, if the amount determined for A, after the application of paragraph (4.‍1)‍(a), was nil in the preceding taxation year, and”;

  • (c)the reference to “first calendar year” in paragraph (b) of the description of D in subsection (4) is to be read as a reference to “fourth calendar year”; and

  • (d)paragraph (a) of the description of E in subsection (4) is to be read as follows:

    “(a)if the preceding taxation year is the year that includes the completion date, or one of the three taxation years immediately following the year that includes the completion date, the total of all amounts each of which is designated under subsection (3) by the individual for the particular taxation year or any preceding taxation year included in the particular period, and”.

    End of inserted block
Temporary repayment relief — conditions
Start of inserted block
(4.‍2)This subsection applies to a taxation year and to an eligible amount received by an individual if
  • (a)the year is 2024 and the completion date in respect of the amount was in 2023;

  • (b)the year is 2025 and the completion date in respect of the amount was in 2023 or 2024;

  • (c)the year is 2026 and the completion date in respect of the amount was in 2023, 2024 or 2025;

  • (d)the year is 2027 and the completion date in respect of the amount was in 2024, 2025 or 2026;

  • (e)the year is 2028 and the completion date in respect of the amount was in 2025 or 2026; and

  • (f)the year is 2029 and the completion date in respect of the amount was in 2026.

    End of inserted block

(5)Subsections (1) and (2) apply to the 2024 and subsequent taxation years in respect of amounts received after April 16, 2024.

(6)Subsections (3) and (4) apply to the 2024 and subsequent taxation years.

50The portion of subsection 146.‍3(6.‍4) of the French version of the Act before paragraph (a) is replaced by the following:

Application du paragraphe (6.‍3)
(6.‍4)À moins que le ministre n’ait renoncé par écrit à appliquer le présent paragraphe à l’égard de tout ou partie de la somme déterminée selon le paragraphe (6.‍3) relativement à un fonds enregistré de revenu de retraite, ce paragraphe ne s’applique pas dans Insertion start l’une des Insertion end circonstances suivantes :

51(1)The portion of paragraph 146.‍4(4)‍(f) of the French version of the Act before subparagraph (i) is replaced by the following:

  • f)le régime ne permet pas que des cotisations y soient versées, Insertion start à un moment donné Insertion end , dans Insertion start l’une des Insertion end circonstances suivantes :

(2)The portion of paragraph 146.‍4(4)‍(g) of the French version of the Act before subparagraph (i) is replaced by the following:

  • g)le régime ne permet pas qu’une cotisation y soit versée, Insertion start à un moment donné Insertion end , dans Insertion start l’une des Insertion end circonstances suivantes :

52(1)Paragraph 147.‍4(1)‍(c) of the Act is replaced by the following:

  • (c)the contract does not permit premiums to be paid at or after that time, other than

    • Insertion start (i) Insertion end a premium paid at that time out of or under the plan to purchase the contract, Insertion start or Insertion end

    • Start of inserted block

      (ii)a premium paid after that time to acquire additional benefits consequential to proceedings commenced under the Bankruptcy and Insolvency Act or the Companies’ Creditors Arrangement Act,

      End of inserted block

(2)Subsection (1) is deemed to have come into force on January 1, 2018.

53(1)Subsection 147.‍5(12) of the Act is replaced by the following:

Member’s account
(12)For the purposes of paragraph 18(1)‍(u), Insertion start section 60.‍011 Insertion end , subparagraph (a)‍(i) of the definition excluded right or interest in subsection 128.‍1(10), paragraph 146(8.‍2)‍(b), subsection 146(8.‍21), paragraphs 146(16)‍(a) and (b), subparagraph 146(21)‍(a)‍(i), paragraph (b) of the definition excluded premium in subsection 146.‍01(1), paragraph (c) of the definition excluded premium in subsection 146.‍02(1), subsections 146.‍3(14) and 147(19) to (21), sections 147.‍3 and 160.‍2 and paragraphs 212(1)‍(j.‍1) and (m), and of regulations made under subsection 147.‍1(18), a member’s account under a PRPP is deemed to be a registered retirement savings plan under which the member is the annuitant.

(2)Subsection (1) is deemed to have come into force on August 4, 2023.

54Subsection 149.‍1(14.‍1) of the French version of the Act is replaced by the following:

Déclarations de renseignements
(14.‍1)Dans les six mois suivant la fin de son année d’imposition, l’organisation journalistique enregistrée doit présenter au ministre, sans avis ni mise en demeure, une déclaration de renseignements et une déclaration publique de renseignements pour l’année, selon le formulaire prescrit et renfermant les renseignements prescrits, y compris, pour la déclaration publique de renseignements, le nom de chaque Insertion start donateur Insertion end dont le total des dons à l’organisation pendant l’année dépasse 5 000 $ ainsi que le montant total des dons effectués par ce Insertion start donateur Insertion end .

55(1)Subsection 150(1.‍2) of the Act is amended by striking out “or” at the end of paragraph (n), by adding “or” at the end of paragraph (o) and by adding the following after paragraph (o):

  • Start of inserted block

    (p)is an eligible trust, as defined in subsection 135.‍2(1).

    End of inserted block

(2)Subsection (1) applies to taxation years that end after December 30, 2023.

56(1)Paragraph 152(1)‍(b) of the Act is replaced by the following:

  • (b)the amount of tax, if any, deemed by any of subsections 120(2) or (2.‍2), 122.‍5(3) to (3.‍003), 122.‍51(2), 122.‍7(2) or (3), 122.‍72(1), 122.‍8(4), 122.‍9(2), 122.‍91(1), 125.‍4(3), 125.‍5(3), 125.‍6(2) or (2.‍1), 127.‍1(1), 127.‍41(3), Insertion start 127.‍48(2) Insertion end or 210.‍2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year.

(2)Paragraph 152(1)‍(b) of the Act, as enacted by subsection (1), is replaced by the following:

  • (b)the amount of tax, if any, deemed by any of subsections 120(2) or (2.‍2), 122.‍5(3) to (3.‍003), 122.‍51(2), 122.‍7(2) or (3), 122.‍72(1), 122.‍8(4), 122.‍9(2), 122.‍91(1), 125.‍4(3), 125.‍5(3), 125.‍6(2) or (2.‍1), 127.‍1(1), 127.‍41(3), 127.‍48(2), Insertion start 127.‍49(2) Insertion end or 210.‍2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year.

(3)Subsection 152(4) of the Act is amended by adding the following before paragraph (c):

  • Start of inserted block

    (b.‍92)a prescribed form that is required to be filed by the taxpayer, or a partnership of which the taxpayer is a member, under subsection 127.‍48(24) is not filed as and when required, and the assessment, reassessment or additional assessment is made in relation to amounts, transactions or events described in any of subsections 127.‍48(21), (22) or (25) to (28) before the day that is

    • (i)in the case of a taxpayer described in paragraph (3.‍1)‍(a), four years after the day on which the form is filed, or

    • (ii)in any other case, three years after the day on which the form is filed;

      End of inserted block

(4)Subsection 152(4) of the Act is amended by adding the following after paragraph (b.‍92), as enacted by subsection (3):

  • Start of inserted block

    (b.‍93)a prescribed form that is required to be filed by the taxpayer, or a partnership of which the taxpayer is a member, under subsection 127.‍49(15) or (18) is not filed as and when required, and the assessment, reassessment or additional assessment is made in relation to transactions or events described in any of subsections 127.‍49(11) to (14) or (16) and (17) before the day that is

    • (i)in the case of a taxpayer described in paragraph (3.‍1)‍(a), four years after the day on which the form is filed, or

    • (ii)in any other case, three years after the day on which the form is filed;

      End of inserted block

(5)Paragraph 152(4.‍01)‍(b) of the Act is amended by striking out “or” at the end of subparagraph (ix) and by adding the following after paragraph (x):

  • Start of inserted block

    (x.‍1)the amounts, transactions or events referred to in paragraph (4)‍(b.‍92), or

  • (x.‍2)the transactions or events referred to in paragraph (4)‍(b.‍93);

    End of inserted block

(6)Subsections (1) and (3) are deemed to have come into force immediately after the expiration of March 27, 2023.

(7)Subsections (2) and (4) are deemed to have come into force on January 1, 2024.

(8)Subparagraph 152(4.‍01)‍(b)‍(x.‍1) of the Act, as enacted by subsection (5), is deemed to have come into force immediately after the expiration of March 27, 2023.

(9)Subparagraph 152(4.‍01)‍(b)‍(x.‍2) of the Act, as enacted by subsection (5), is deemed to have come into force on January 1, 2024.

57(1)Paragraph 153(1)‍(d.‍1) of the Act is replaced by the following:

  • (d.‍1)an amount described in subparagraph 56(1)‍(a)‍(iv), (vii) Insertion start or (viii) Insertion end ,

(2)Section 153 of the Act is amended by adding the following after subsection (1.‍04):

Canada Emergency Wage Subsidy claimed
Start of inserted block
(1.‍05)Despite subsection (1.‍02), an amount is not deemed to have been remitted to the Receiver General if
  • (a)the eligible employer made an application in respect of section 125.‍7 for a qualifying period in respect of which the eligible employer was, without reference to this subsection, deemed under subsection (1.‍02) to have remitted the amount to the Receiver General; and

  • (b)the amount was not included under the description of B in subsection 125.‍7(2) for the eligible employer.

    End of inserted block

(3)Subsection (1) is deemed to have come into force on April 1, 2019.

(4)Subsection (2) is deemed to have come into force on March 18, 2020.

58(1)Paragraph 157(3)‍(e) of the Act is replaced by the following:

  • (e)1/12 of the total of the amounts each of which is deemed by subsection 125.‍4(3), 125.‍5(3), 125.‍6(2) or (2.‍1), 127.‍1(1), 127.‍41(3) or Insertion start 127.‍48(2) Insertion end to have been paid on account of the corporation’s tax payable under this Part for the year.

(2)Paragraph 157(3)‍(e) of the Act, as enacted by subsection (1), is replaced by the following:

  • (e)1/12 of the total of the amounts each of which is deemed by subsection 125.‍4(3), 125.‍5(3), 125.‍6(2) or (2.‍1), 127.‍1(1), 127.‍41(3), 127.‍48(2) or Insertion start 127.‍49(2) Insertion end to have been paid on account of the corporation’s tax payable under this Part for the year.

(3)Paragraph 157(3.‍1)‍(c) of the Act is replaced by the following:

  • (c)1/4 of the total of the amounts each of which is deemed by subsection 125.‍4(3), 125.‍5(3), 125.‍6(2) or (2.‍1), 127.‍1(1), 127.‍41(3)or Insertion start 127.‍48(2) Insertion end to have been paid on account of the corporation’s tax payable under this Part for the taxation year.

(4)Paragraph 157(3.‍1)‍(c) of the Act, as enacted by subsection (3), is replaced by the following:

  • (c)1/4 of the total of the amounts each of which is deemed by subsection 125.‍4(3), 125.‍5(3), 125.‍6(2) or (2.‍1), 127.‍1(1), 127.‍41(3), 127.‍48(2) or Insertion start 127.‍49(2) Insertion end to have been paid on account of the corporation’s tax payable under this Part for the taxation year.

(5)Subsections (1) and (3) are deemed to have come into force immediately after the expiration of March 27, 2023.

(6)Subsections (2) and (4) are deemed to have come into force on January 1, 2024.

59(1)Subsection 163(2) of the Act is amended by adding the following before paragraph (e):

  • Start of inserted block

    (d.‍1)the amount, if any, by which

    • (i)the amount that would be deemed by subsection 127.‍48(2), as the case may be, to be paid for the year by the person if that amount were calculated by reference to the information provided in the return or form filed for the year under that subsection

  • exceeds

    • (ii)the amount that is deemed by subsection 127.‍48(2), as the case may be, to be paid for the year by the person,

      End of inserted block

(2)Paragraph 163(2)‍(d.‍1) of the Act, as enacted by subsection (1), is replaced by the following:

  • (d.‍1)the amount, if any, by which

    • (i)the amount that would be deemed by subsection 127.‍48(2) or Insertion start 127.‍49(2) Insertion end , as the case may be, to be paid for the year by the person if that amount were calculated by reference to the information provided in the return or form filed for the year under that subsection

  • exceeds

    • (ii)the amount that is deemed by subsection 127.‍48(2) or Insertion start 127.‍49(2) Insertion end , as the case may be, to be paid for the year by the person,

(3)Subsection (1) is deemed to have come into force immediately after the expiration of March 27, 2023.

(4)Subsection (2) is deemed to have come into force on January 1, 2024.

60(1)The portion of subsection 164(3) of the Act before paragraph (a) is replaced by the following:

Interest on refunds and repayments
(3)If, under this section, an amount in respect of a taxation year (other than an amount, or a portion of the amount, that can reasonably be considered to arise from the operation of Insertion start paragraph 60(n.‍2) or Insertion end section 122.‍5, 122.‍61, 122.‍72, 122.‍8 or 125.‍7) is refunded or repaid to a taxpayer or applied to another liability of the taxpayer, the Minister shall pay or apply interest on it at the prescribed rate for the period that begins on the day that is the latest of the days referred to in the following paragraphs and that ends on the day on which the amount is refunded, repaid or applied:
(2)The portion of subsection 164(3) of the Act before paragraph (a), as enacted by subsection (1), is replaced by the following:
Interest on refunds and repayments
(3)If, under this section, an amount in respect of a taxation year (other than an amount, or a portion of the amount, that can reasonably be considered to arise from the operation of paragraph 60(n.‍2) or section 122.‍5, 122.‍61, 122.‍72, 122.‍8, 125.‍7 or Insertion start 127.‍421 Insertion end ) is refunded or repaid to a taxpayer or applied to another liability of the taxpayer, the Minister shall pay or apply interest on it at the prescribed rate for the period that begins on the day that is the latest of the days referred to in the following paragraphs and that ends on the day on which the amount is refunded, repaid or applied:

(3)Subsection (1) applies to the 2019 and subsequent taxation years.

61Subsection 204.‍1(4) of the French version of the Act is replaced by the following:

Renonciation
(4)Le ministre peut renoncer à l’impôt dont un particulier serait, compte non tenu du présent paragraphe, redevable pour un mois selon les paragraphes (1) ou (2.‍1), si celui-ci établit à la satisfaction du ministre que l’excédent ou l’excédent cumulatif qui est frappé de l’impôt fait suite à une erreur Insertion start raisonnable Insertion end et que Insertion start des Insertion end mesures Insertion