Fall Economic Statement Implementation Act, 2022 (S.C. 2022, c. 19)

SUBDIVISION A.6Multigenerational Home Renovation Tax Credit

Marginal note:Definitions

• 122.92 (1) The following definitions apply in this section.

  eligible dwelling

  eligible dwelling, of a qualifying individual, for a renovation period taxation year, means a housing unit (including the land subjacent to the housing unit and the immediately contiguous land, but not including the portion of that land that exceeds the greater of ½ hectare and the portion of that land that is necessary for the use and enjoyment of the housing unit as a residence) located in Canada if

  • (a) the qualifying individual or a qualifying relation of the qualifying individual (or a trust under which the qualifying individual or a qualifying relation is a beneficiary) owns — whether jointly with another person or otherwise — at any time in the renovation period taxation year, the housing unit; and

  • (b) the housing unit is ordinarily inhabited, or is reasonably expected to be ordinarily inhabited, within 12 months after the end of the renovation period

    • (i) by the qualifying individual, and

    • (ii) by a qualifying relation of the qualifying individual. (logement admissible)

  eligible individual

  eligible individual, in respect of an eligible dwelling for a renovation period taxation year, means

  • (a) an individual who ordinarily resides, or intends to ordinarily reside, in the eligible dwelling within 12 months after the end of the renovation period in respect of a qualifying renovation of the eligible dwelling and who is

    • (i) a qualifying individual,

    • (ii) the cohabiting spouse or common-law partner (as defined in section 122.6) of a qualifying individual at any time in the renovation period taxation year, or

    • (iii) a qualifying relation of a qualifying individual; or

  • (b) an individual who

    • (i) is a qualifying relation of a qualifying individual, and

    • (ii) owns the eligible dwelling or is the beneficiary of a trust that owns the eligible dwelling. (particulier admissible)

  individual

  individual does not include a trust. (particulier)

  qualifying expenditure

  qualifying expenditure, of an individual, means a reasonable outlay or expense that

  • (a) is directly attributable to a qualifying renovation of an eligible dwelling in respect of which the individual is an eligible individual;

  • (b) is made or incurred by the individual before the end of the renovation period in respect of the qualifying renovation referred to in paragraph (a);

  • (c) is the cost of goods acquired or services received, including an outlay or expense for permits required for, or for the rental of equipment used in the course of, the qualifying renovation; and

  • (d) is not an outlay or expense

    • (i) for the cost of annual, recurring or routine repair or maintenance,

    • (ii) to acquire a household appliance,

    • (iii) to acquire an electronic home-entertainment device,

    • (iv) that is the cost of housekeeping, security monitoring, gardening, outdoor maintenance or similar services,

    • (v) for financing costs in respect of the qualifying renovation,

    • (vi) in respect of goods or services provided by a person not dealing at arm’s length with the individual, unless the person is registered for the purposes of Part IX of the Excise Tax Act, or

    • (vii) that can reasonably be considered to have been reimbursed. (dépense admissible)

  qualifying individual

  qualifying individual, in respect of a renovation period taxation year, means an individual who has attained the age of

  • (a) 65 years before the end of the renovation period taxation year; or

  • (b) 18 years before the end of the renovation period taxation year and in respect of whom an amount is deductible, or would be deductible if this Act were read without reference to paragraph 118.3(1)(c), under section 118.3 in computing a taxpayer’s tax payable under this Part for the renovation period taxation year. (particulier déterminé)

  qualifying relation

  qualifying relation, of a qualifying individual for a renovation period taxation year, means an individual who

  • (a) has attained the age of 18 years before the end of the renovation period taxation year; and

  • (b) at any time in the renovation period taxation year, is a parent, grandparent, child, grandchild, brother, sister, aunt, uncle, niece or nephew of either the qualifying individual or the cohabiting spouse or common-law partner (as defined in section 122.6) of the qualifying individual. (proche admissible)

  qualifying renovation

  qualifying renovation means a renovation or alteration of, or addition to, an eligible dwelling of a qualifying individual that

  • (a) is of an enduring nature and integral to the eligible dwelling; and

  • (b) is undertaken to enable the qualifying individual to reside in the dwelling with a qualifying relation of the qualifying individual by establishing a secondary unit within the dwelling for occupancy by the qualifying individual or the qualifying relation. (travaux de rénovation admissibles)

  renovation period

  renovation period, for a qualifying renovation of an eligible dwelling, means a period that

  • (a) begins at the time that the first qualifying expenditure is made or incurred in respect of the qualifying renovation, and

  • (b) ends at the time of the completion of the qualifying renovation. (période de rénovation)

  renovation period taxation year

  renovation period taxation year means the taxation year in which the renovation period in respect of a qualifying renovation ends. (année d’imposition de la période de rénovation)

  secondary unit

  secondary unit means a self-contained housing unit that

  • (a) has a private entrance, kitchen, bathroom and sleeping area,

  • (b) if applicable, meets any local requirements to qualify as a secondary dwelling unit, and

  • (c) meets prescribed conditions, if any. (logement secondaire)

• Marginal note:Qualifying expenditure — trusts

  (2) For the purposes of this section, a qualifying expenditure of a particular individual who is an eligible individual in respect of an eligible dwelling includes an outlay or expense made or incurred by a trust of which the particular individual is a beneficiary, in respect of the eligible dwelling, to the extent of the share of that outlay or expense that is reasonably attributable to the eligible dwelling, having regard to the amount of the outlays or expenses made or incurred in respect of the eligible dwelling, if

  • (a) the outlay or expense would be a qualifying expenditure of the particular individual if the outlay or expense had been made or incurred by that individual; and

  • (b) the trust has notified the particular individual of the amount of the outlay or expenses that are attributable to the eligible dwelling.

• Marginal note:Deemed overpayment

  (3) An eligible individual who files a return of income for a renovation period taxation year and who makes a claim under this subsection in that return of income is deemed to have paid, at the end of the taxation year, on account of tax payable under this Part for the taxation year, an amount equal to the amount determined by the formula

  A × B

  where

  A

  is the appropriate percentage for the taxation year; and

  B

  is the least of

  • (a) $50,000,

  • (b) the total of all amounts, each of which is a qualifying expenditure of the individual in respect of a qualifying renovation that ended in the taxation year, and

  • (c) if the individual is not resident in Canada throughout the taxation year, nil.

• Marginal note:Limits

  (4) For the purpose of this section,

  • (a) in respect of a qualifying individual, there may only be one qualifying renovation for the purpose of a claim under subsection (3) by all taxpayers during the lifetime of the qualifying individual;

  • (b) a maximum of $50,000 of qualifying expenditures may be claimed by all taxpayers in respect of the same qualifying renovation; and

  • (c) if more than one taxpayer is entitled to a deduction under subsection (3) in respect of the same qualifying individual or the same qualifying renovation and the taxpayers cannot agree as to what portion of the amount each can so deduct, the Minister may fix the portions.

• Marginal note:Effect of bankruptcy

  (5) For the purpose of this Subdivision, if an eligible individual becomes bankrupt in a particular calendar year, despite subsection 128(2), any reference to the taxation year of the eligible individual is deemed to be a reference to the particular calendar year.

• Marginal note:Special rules in the event of death

  (6) For the purpose of this section, if an eligible individual or a qualifying individual dies in a calendar year,

  • (a) the deceased individual is deemed to be resident in Canada from the time of death until the end of the year if, immediately before death, the deceased individual was resident in Canada;

  • (b) the deceased individual is deemed to be the same age at the end of the year as the individual would have been if the individual were alive at the end of the year;

  • (c) the deceased individual is deemed to be the cohabiting spouse or common-law partner of another individual (referred to in this paragraph as the “surviving spouse”) at the end of the year if,

    • (i) immediately before death, the deceased individual was the cohabiting spouse or common-law partner (as defined in section 122.6) of the surviving spouse, and

    • (ii) the surviving spouse is not the cohabiting spouse or common-law partner (as defined in section 122.6) of another individual at the end of the year; and

  • (d) any return of income filed by a legal representative of the deceased individual is deemed to be a return of income filed by the individual.

Additional Tax on Banks and Life Insurers

Marginal note:Definition

• 123.6 (1) The following definition applies in this section.

  bank or life insurer group member

  bank or life insurer group member means a corporation that is

  • (a) a bank;

  • (b) a life insurance corporation that carries on business in Canada; or

  • (c) a financial institution (as defined in subsection 190(1)) that is related to any corporation described in paragraph (a) or (b). (membre d’un groupe de banques ou d’assureurs-vie)

• Marginal note:Additional tax payable

  (2) There shall be added to the tax otherwise payable under this Part for a taxation year, by a corporation that is a bank or life insurer group member at any time during the taxation year, an amount determined by the formula

  0.015 (A − B)

  where

  A

  is the corporation’s taxable income for the taxation year (or the corporation’s taxable income earned in Canada if the corporation is non-resident in the taxation year); and

  B

  is

  • (a) if the corporation is not related to another bank or life insurer group member at the end of the taxation year of the corporation,

    • (i) where the corporation’s taxation year is not less than 51 weeks, $100 million, and

    • (ii) in any other case, the amount determined by the formula

      $100 million × (C ÷ 365)

      where

      C

      is the number of days in the taxation year, and

  • (b) in any other case, subject to subsection (5), nil.

• Marginal note:Related group

  (3) For the purposes of this section, a corporation that is described in paragraph (a) or (b) of the definition bank or life insurer group member in subsection (1) at any time during a taxation year and that was related to another bank or life insurer group member at the end of the year (in this section, the corporation and each such bank or life insurer group member are referred to together as the “related group”) may file with the Minister, with the corporation’s return of income, an agreement in prescribed form on behalf of the related group under which an amount that does not exceed $100 million is allocated among the related group for all taxation years of members of the related group ending in the same calendar year.

• Marginal note:Allocation by Minister

  (4) The Minister may request a corporation that is a member of a related group at any time during a taxation year to file with the Minister an agreement referred to in subsection (3) and, if the corporation does not file the agreement within 30 days after receiving the request, the Minister may allocate the amount referred to in subsection (3) among the related group for the taxation years of the bank or life insurer group members ending in the same calendar year.

• Marginal note:Allocation

  (5) For the purposes of this section, the least amount allocated for a taxation year to each bank or life insurer group member under an agreement described in subsection (3) or by the Minister under subsection (4) is the amount determined for B in subsection (2) for the taxation year of that member, but, if no such allocation is made, the amount determined for B in subsection (2) of each bank or life insurer group member for that year is nil.

• Marginal note:Anti-avoidance

  (6) If an amount has been deducted in computing the income of a corporation, the amount is deemed not to have been deducted in computing the corporation’s taxable income, or taxable income earned in Canada, as the case may be, for the purpose of computing the tax payable by the corporation under subsection (2), if

  • (a) the deduction is in respect of an amount that can reasonably be considered to have been paid or payable (in this subsection referred to as “the payment”), directly or indirectly, to a person or partnership that was not dealing at arm’s length with the corporation;

  • (b) the person or partnership was not a bank or life insurer group member; and

  • (c) it can reasonably be considered that one of the purposes of the payment was to reduce the tax payable by the corporation under subsection (2).

• (i) the taxpayer’s investment tax credit at the end of the year in respect of property acquired before the end of the year, of the taxpayer’s apprenticeship expenditure for the year or a preceding taxation year, of the taxpayer’s flow-through mining expenditure for the year or a preceding taxation year, of the taxpayer’s flow-through critical mineral mining expenditure for the year or a preceding taxation year, of the taxpayer’s pre-production mining expenditure for the year or a preceding taxation year or of the taxpayer’s SR&ED qualified expenditure pool at the end of the year or at the end of a preceding taxation year, and

• (A) the taxpayer’s investment tax credit at the end of the year in respect of property acquired in a subsequent taxation year, of the taxpayer’s apprenticeship expenditure for a subsequent taxation year, of the taxpayer’s flow-through mining expenditure for a subsequent taxation year, of the taxpayer’s flow-through critical mineral mining expenditure for a subsequent taxation year, of the taxpayer’s pre-production mining expenditure for a subsequent taxation year or of the taxpayer’s SR&ED qualified expenditure pool at the end of the subsequent taxation year to the extent that an investment tax credit was not deductible under this subsection for the subsequent taxation year, and

• (e) that is not an expense that the taxpayer has included under paragraph (a.21) of the definition investment tax credit in the computation of its investment tax credit in respect of which the taxpayer has, at any time, sought a deduction under subsection (5); (dépense minière déterminée)

• (a.21) where the taxpayer is an individual (other than a trust), 30% of the taxpayer’s flow-through critical mineral mining expenditures for the year,

critical mineral

critical mineral means

• (a) copper,

• (b) nickel,

• (c) lithium,

• (d) cobalt,

• (e) graphite,

• (f) a rare earth element,

• (g) scandium,

• (h) titanium,

• (i) gallium,

• (j) vanadium,

• (k) tellurium,

• (l) magnesium,

• (m) zinc,

• (n) a platinum group metal, or

• (o) uranium; (minéral critique)

flow-through critical mineral mining expenditure

flow-through critical mineral mining expenditure of a taxpayer for a taxation year means an expense deemed by subsection 66(12.61) (or by subsection 66(18) as a consequence of the application of subsection 66(12.61) to the partnership, referred to in paragraph (c) of this definition, of which the taxpayer is a member) to be incurred by the taxpayer in the year

• (a) that is a Canadian exploration expense incurred by a corporation after April 7, 2022 in conducting mining exploration activity from or above the surface of the earth primarily targeting critical minerals,

• (b) that

  • (i) is an expense described in paragraph (f) of the definition Canadian exploration expense in subsection 66.1(6), and

  • (ii) is not an expense in respect of

    • (A) trenching, if one of the purposes of the trenching is to carry out preliminary sampling (other than specified sampling),

    • (B) digging test pits (other than for the purpose of carrying out specified sampling), and

    • (C) preliminary sampling (other than specified sampling),

• (c) that is 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 April 7, 2022 and on or before March 31, 2027,

• (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 April 7, 2022 and on or before March 31, 2027,

• (e) that, in respect of an agreement described in paragraph (c), a qualified professional engineer or professional geoscientist certifies in prescribed form and manner that the expense is to be incurred in accordance with an exploration plan that primarily targets critical minerals if the qualified professional engineer or professional geoscientist

  • (i) completed the certification within the 12-month period immediately preceding the time when the agreement is made, and

  • (ii) acted reasonably, in their professional capacity, in completing the certification, and

• (f) that is not an expense that the taxpayer has included under paragraph (a.2) of the definition investment tax credit in the computation of its investment tax credit in respect of which the taxpayer has, at any time, sought a deduction under subsection (5); (dépense minière de minéral critique déterminée)

qualified professional engineer or professional geoscientist

qualified professional engineer or professional geoscientist means an individual who

• (a) is an engineer or geoscientist with a university degree, or equivalent accreditation, in an area of geoscience, or engineering, relating to mineral exploration or mining,

• (b) has at least five years of experience in mineral exploration, mine development or operation, or mineral project assessment, or any combination of those, that is relevant to their professional degree or area of practice,

• (c) has experience relevant to the subject matter of the exploration plan and the certification described in paragraph (e) of the definition flow-through critical mineral mining expenditure, and

• (d) 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 or geoscience in

  • (i) the jurisdiction where the property that is the subject of the exploration plan 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 or geoscience; (ingénieur ou géoscientifique professionnel qualifié)

• (c.21) the amount of a taxpayer’s flow-through critical mineral mining expenditure for a taxation year is deemed to be the amount of the taxpayer’s flow-through critical mineral mining expenditure for the year as otherwise determined less the amount of any government assistance or non-government assistance in respect of expenses included in determining the taxpayer’s flow-through critical mineral mining expenditure for the year that, at the time of the filing of the taxpayer’s return of income for the year, the taxpayer has received, is entitled to receive or can reasonably be expected to receive;