Income Tax Act — I-3.3 110.6
e taxation year, and (ii) in any other case, 1, (b) the individual’s cumulative gains limit at the end of the year, (c) the individual’s annual gains limit for the year, and (d) the amount that would be determined in respect of the individual for the year under paragraph 3(b) in respect of capital gains and capital losses if the only properties referred to in that paragraph were properties that, at the time they were disposed of, were qualified farm properties, qualified fishing properties or qualified farm or fishing properties. Capital gains deduction — qualified small business corporation shares (2.1) In computing the taxable income for a taxation year of an individual (other than a trust) who was resident in Canada throughout the year and who disposed of a share of a corporation in the year or a preceding taxation year and after June 17, 1987 that, at the time of disposition, was a qualified small business corporation share of the individual, there may be deducted such amount as the individual may claim not exceeding the least of (a) the amount determined by the formula in paragraph (2)(a) in respect of the individual for the year, (b) the amount, if any, by which the individual’s cumulative gains limit at the end of the year exceeds the amount deducted under subsection 110.6(2) in computing the individual’s taxable income for the year, (c) the amount, if any, by which the individual’s annual gains limit for the year exceeds the amount deducted under subsection 110.6(2) in computing the individual’s taxable income for the year, and (d) the amount that would be determined in respect of the individual for the year under paragraph 3(b) (to the extent that that amount is not included in computing the amount determined under paragraph (2)(d) in respect of the individual) in respect of capital gains and capital losses if the only properties referred to in paragraph 3(b) were qualified small business corporation shares of the individual. Additional deduction — 2024 (2.2) In computing the taxable income of an individual (other than a trust) for the individual’s taxation year that includes June 25, 2024 (referred to in this subsection as the “transition year”), there may be deducted, where that individual was resident in Canada throughout the transition year and that individual disposed of in the transition year, and on or after June 25, 2024, a qualified small business corporation share of the individual or a qualified farm or fishing property of the individual, such amount as the individual may claim not exceeding the least of (a) $116,582, (b) the amount, if any, by which the individual’s cumulative gains limit at the end of the transition year exceeds the total of all amounts each of which is an amount deducted by the individual under subsection (2) or (2.1) in computing the individual’s taxable income for the transition year, (c) the amount, if any, by which the individual’s annual gains limit for the transition year exceeds the total of all amounts each of which is an amount deducted by the individual under subsection (2) or (2.1) in computing the individual’s taxable income for the transition year, and (d) the amount that would be determined in respect of the individual for the transition year under paragraph 3(b) in respect of capital gains and capital losses if the only properties referred to in that paragraph were qualified small business corporation shares of the individual and qualified farm or fishing properties of the individual, disposed of by the individual on or after June 25, 2024. Additional deduction — ordering rule (2.3) Subsection (2.2) does not apply in computing the taxable income for a taxation year of an individual unless the individual has claimed the maximum amount that could be claimed under subsections (2) and (2.1) for the taxation year. (3) [Repealed, 1995, c. 3, s. 32] Maximum capital gains deduction (4) Notwithstanding subsections (2) and (2.1), the total amount that may be deducted under this sect