Budget Implementation Act, 2023, No. 1 (S.C. 2023, c. 26)

C.R.C., c. 945Income Tax Regulations

• 96 (1) Subsection 202(6) of the Income Tax Regulations is replaced by the following:

  • (6) A non-resident person, or an authorized foreign bank, that is deemed under subsection 212(13.2) or paragraph 212(13.3)(a) of the Act to be a person resident in Canada for the purposes of Part XIII of the Act, is deemed, in the same circumstances, to be a person resident in Canada for the purposes of subsections (1) and (2).

• (2) Subsection (1) applies to amounts paid or credited after 2022.

• 97 (1) Subsection 205(3) of the Regulations is amended by adding the following in alphabetical order:

  Part XX Information Return – Digital Platform Operators

• (2) Subsection (1) comes into force on January 1, 2024.

• 98 (1) The portion of subsection 205.1(1) of the Regulations, before the list of types of prescribed information returns, is replaced by the following:

  • 205.1 (1) For the purpose of subsection 162(7.02) of the Act, the following types of information returns are prescribed and must be filed electronically if more than five information returns of that type are required to be filed for a calendar year:

• (2) The portion of subsection 205.1(2) of the Regulations before paragraph (a) is replaced by the following:

  • (2) For purposes of subsection 150.1(2.1) of the Act, a prescribed corporation is any corporation except

• (3) Subsection (1) applies in respect of information returns filed after 2023.

• (4) Subsection (2) applies to taxation years that begin after 2023.

• 99 (1) Subsection 209(1) of the Regulations is replaced by the following:

  • 209 (1) A person who is required by section 200, 201, 202, 203, 204, 212, 214 (other than subsection 214(1.1)), 215 (other than subsection 215(2.1)), 217 or 218, subsection 219(2) or 223(2) or section 228, 229, 230, 232, 233 or 234 to make an information return shall forward to each taxpayer to whom the return relates two copies of the portion of the return that relates to that taxpayer.

• (2) The portion of subsection 209(5) of the Regulations before paragraph (a) is replaced by the following:

  • (5) A person may provide a Statement of Remuneration Paid (T4) information return, a Tuition and Enrolment Certificate, a Statement of Pension, Retirement, Annuity, and Other Income (T4A) information return or a Statement of Investment Income (T5) information return, as required under subsection (1), as a single document in an electronic format (instead of the two copies required under subsection (1)) to the taxpayer to whom the return relates, on or before the date on which the return is to be filed with the Minister, unless

• (3) The portion of subsection 209(5) of the Regulations before paragraph (a) is replaced by the following:

  • (5) A person may provide a Statement of Remuneration Paid (T4) information return, a Tuition and Enrolment Certificate, a FHSA information return, a Statement of Pension, Retirement, Annuity, and Other Income (T4A) information return or a Statement of Investment Income (T5) information return, as required under subsection (1), as a single document in an electronic format (instead of the two copies required under subsection (1)) to the taxpayer to whom the return relates, on or before the date on which the return is to be filed with the Minister, unless

• (4) Subsection (1) applies to the 2023 and subsequent taxation years.

• (5) Subsection (2) applies in respect of information returns filed after 2021.

• (6) Subsection (3) is deemed to have come into force on April 1, 2023.

• 100 (1) Section 214 of the Regulations is amended by adding the following after subsection (1):

  • (1.1) The issuer of a registered retirement savings plan shall make an information return in prescribed form for each calendar year containing the total fair market value of all property held by the plan at the end of the year.

• (2) Subsection (1) applies to the 2023 and subsequent taxation years.

• 101 (1) Section 215 of the Regulations is amended by adding the following after subsection (2):

  • (2.1) Every carrier of a registered retirement income fund shall make an information return in prescribed form for each calendar year containing the total fair market value of all property held by the fund at the end of the year.

• (2) Subsection (1) applies to the 2023 and subsequent taxation years.

• 102 (1) Paragraph (a) of the definition Canadian equity property in subsection 2400(1) of the Regulations is replaced by the following:

  • (a) a share of the capital stock of, or an income bond or income debenture issued by, a person (other than a corporation affiliated with the taxpayer) resident in Canada or a Canadian partnership; or

• (2) Paragraph (a) of the definition equity property in subsection 2400(1) of the Regulations is replaced by the following:

  • (a) a share of the capital stock of, or an income bond or income debenture, issued by, another person (other than a corporation affiliated with the taxpayer) or partnership; or

• 103 (1) Subsection 3900(2) of the Regulations is replaced by the following:

  • (2) For the purpose of paragraph 20(1)(v) of the Act, the amount allowed for a taxation year in respect of taxes on income from mining operations of a taxpayer is the total of all amounts each of which is

    • (a) an eligible tax that is paid or payable by the taxpayer

      • (i) on the income of the taxpayer for the taxation year from mining operations, or

      • (ii) on a non-Crown royalty included in computing the income of the taxpayer for the taxation year;

    • (b) an eligible tax that is paid by the taxpayer in the taxation year on either the income of the taxpayer for a previous taxation year from mining operations or a non-Crown royalty included in computing the income of the taxpayer for a previous taxation year, if

      • (i) the amount was deductible in computing the income of the taxpayer for the previous taxation year,

      • (ii) the amount has not been deducted in computing the income of the taxpayer for a taxation year that is prior to the taxation year, and

      • (iii) an assessment of the taxpayer to take into account a deduction in respect of the eligible tax under the Act for the previous taxation year would be precluded because of subsections 152(4) to (5) of the Act; or

    • (c) interest in respect of eligible tax referred to in paragraph (a) or (b) that is paid in the taxation year by the taxpayer to the province imposing the eligible tax.

• (2) Subsection (1) applies to taxation years that end after 2007.

• 104 (1) Subsection 4802(1) of the Regulations is amended by striking out “and” at the end of paragraph (f) and by adding the following after that paragraph:

  • (f.1) the Pension Benefits Guarantee Fund under the Pension Benefits Act, R.S.O. 1990, c. P.8 and any corporation established solely for investing the assets of the Pension Benefits Guarantee Fund; and

• (2) Section 4802 of the Regulations is amended by adding the following after subsection (1.1):

  • (1.2) For the purposes of paragraph 8502(i.2), if an amount is borrowed (other than an amount described in paragraph (1.1)(c)) at a particular time by a trust described in subsection (1.1) in relation to defined benefit provisions of one or more registered pension plans that are beneficiaries of the trust, each such defined benefit provision is deemed to have borrowed at the particular time an amount that is equal to the following amount:

    • (a) if paragraph (b) does not apply, the amount determined by the formula

      A × (B ÷ C)

      where

      A

      is the amount borrowed by the trust at the particular time,

      B

      is the fair market value at the particular time of the interest of the defined benefit provision in

      • (i) if the borrowing relates to a particular class of units of the trust, that class of units, and

      • (ii) in any other case, the income and capital of the trust, and

      C

      is the fair market value at the particular time of all interests of defined benefit provisions in

      • (i) if the borrowing relates to a particular class of units of the trust, that class of units, and

      • (ii) in any other case, the income and capital of the trust; and

    • (b) the portion of the amount borrowed by the trust at the particular time that is allocated to the defined benefit provision under an agreement entered into between the trust and the defined benefit provision, provided that the agreement allocates to the beneficiaries the total amount borrowed by the trust.

  • (1.3) If an amount borrowed by a trust is deemed to have been borrowed by a defined benefit provision under subsection (1.2), the amount is deemed not to have been borrowed by the trust for the purposes of paragraph (1.1)(c).

• (3) Subsection (1) applies to 2022 and subsequent taxation years.

• (4) Subsection (2) is deemed to have come into force on April 7, 2022.

• 105 (1) The portion of paragraph 8301(4)(a) of the Regulations before subparagraph (i) is replaced by the following:

  • (a) a contribution (other than an excluded contribution, a contribution described in paragraph 8308(6)(e) or (g) or a contribution made under subsection 147.1(20) of the Act) made under the provision in the year by

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

• 106 (1) Subsection 8304.1(1) of the Regulations is replaced by the following:

  • 8304.1 (1) For the purpose of subsection 248(1) of the Act, an individual’s total pension adjustment reversal for a calendar year is the total of all amounts each of which is

    • (a) the pension adjustment reversal (in this Part and Part LXXXIV referred to as “PAR”) determined in connection with the individual’s termination in the year from a deferred profit sharing plan or from a benefit provision of a registered pension plan; or

    • (b) the pension adjustment correction determined in respect of the individual for the year under subsection (16).

• (2) Section 8304.1 of the Regulations is amended by adding the following after subsection (15):

  Pension Adjustment Correction

  • (16) If a distribution described in subparagraph 8502(d)(iii) or subsection 147.1(19) of the Act is made in a calendar year in respect of an individual under a money purchase provision, the individual’s pension adjustment correction for the year is the total of all amounts each of which is an amount, in respect of one or more of the 10 years immediately preceding the calendar year (each such year referred to in this subsection as a “retroactive year”), determined by the formula

    A − B − C

    where

    A

    is the total of all amounts each of which was included in determining the individual’s pension credit with respect to an employer for the retroactive year under the provision;

    B

    is the total amount that ought to have been contributed to the provision under the terms of the plan as registered with respect to the individual for the retroactive year; and

    C

    is the amount, if any, by which the total of all amounts each of which is the individual’s pension adjustment for the retroactive year in respect of a participating employer exceeds the lesser of the money purchase limit for the retroactive year and 18% of the individual’s compensation (as defined in subsection 147.1(1) of the Act) from participating employers for the retroactive year.

• (3) Subsections (1) and (2) are deemed to have come into force on January 1, 2021.

• 107 (1) Section 8308 of the Regulations is amended by adding the following after subsection (5.3):

  Conditions – Permitted Corrective Contribution

  • (5.4) If the individual makes a written commitment to the administrator of the plan or to an employer who participates in the plan to make a permitted corrective contribution in accordance with subsection 147.1(20) of the Act in installments, amounts payable by the individual or the employer in respect of the contribution are deemed for the purposes of subsection 8402(4) and the definition net past service pension adjustment in subsection 146(1) of the Act to have been made at the time when the written commitment was made.

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

• 108 (1) Section 8402 of the Regulations is amended by adding the following after subsection (3):

  • (4) The administrator of a registered pension plan shall file with the Minister an information return in prescribed form within 120 days after a contribution is made to the plan in respect of an individual under subsection 147.1(20) of the Act.

• (2) Subsection (1) is deemed to have come into force on January 1, 2021. However, in its application to a contribution made before this Act receives royal assent, the administrator of the registered pension plan shall not be required to file the prescribed information return prior to the day that is 60 days after the day on which this Act receives royal assent.

• 109 (1) Section 8402.01 of the Regulations is amended by adding the following after subsection (4):

  Pension Adjustment Correction – Employer Reporting

  • (4.1) If a pension adjustment correction under subsection 8304.1(16) is determined for an individual in connection with a distribution from a registered pension plan (other than a pension adjustment correction that is nil), the administrator of the plan shall file with the Minister an information return in prescribed form reporting the pension adjustment correction

    • (a) if the distribution occurs in the first, second or third quarter of a calendar year, on or before the day that is 60 days after the last day of the quarter in which the distribution occurs; and

    • (b) if the distribution occurs in the fourth quarter of a calendar year, before February of the following calendar year.

• (2) Subsection (1) is deemed to have come into force on January 1, 2021. However, in its application to a distribution that is made before this Act receives royal assent, the administrator of the registered pension plan is not required to file the prescribed information return prior to the day that is 60 days after the day on which this Act receives royal assent.

• 110 (1) Subparagraph 8502(d)(v) of the Regulations is replaced by the following:

  • (v) a payment of interest (computed at a rate not exceeding a reasonable rate) in respect of contributions that are returned as described in subparagraph (iii) or (iv),

• (2) The portion of paragraph 8502(i) of the Regulations before subparagraph (i) is replaced by the following:

  • (i) subject to paragraph (i.2), a trustee or other person who holds property in connection with the plan does not borrow money for the purposes of the plan, except where

• (3) Section 8502 of the Regulations is amended by adding the following after paragraph (i.1):

  Borrowing – Defined Benefit Provision

  • (i.2) in the case of a defined benefit provision of the plan (other than an individual pension plan), a trustee or other person who holds property in connection with the provision does not borrow money for the purposes of the provision, except in the circumstances described in paragraph (i) or if, at the time an amount is borrowed

    • (i) the difference between A and B in subparagraph (ii) does not exceed 125% of the actuarial liabilities (determined on the effective date of the plan’s most recent actuarial report) in respect of the provision, and

    • (ii) the total of the borrowed amount and the amount of any other outstanding borrowings in respect of the provision (other than an amount described in paragraph (i)) does not exceed the amount determined by the formula

      0.20 × (A − B)

      where

      A

      is the value of the plan assets in respect of the provision on the first day of the fiscal period of the plan in which the amount is borrowed, and

      B

      is the amount of outstanding borrowings in respect of the provision, determined on the first day of the fiscal period in which the amount is borrowed;

• (4) Subsection (1) is deemed to have come into force on January 1, 2021.

• (5) Subsections (2) and (3) are deemed to have come into force on April 7, 2022.