Income Tax Act — I-3.3 110
e where the benefits are payable to the taxpayer in respect of a deceased individual, (A) the taxpayer was, immediately before the deceased individual’s death, the deceased individual’s spouse or common-law partner, (B) the taxpayer has continuously during a period that begins at the time of the deceased individual’s death and ends in the taxation year, been resident in Canada, (C) the deceased individual was, in respect of the taxation year in which the deceased individual died, a taxpayer described in subparagraph (i), and (D) in each taxation year that ends in a period that begins before 1996 and that ends in the taxation year, the taxpayer, the deceased individual, or both of them, received U.S. social security benefits. (i) [Repealed, 1994, c. 7, Sch. II, s. 78(3)] (j) [Repealed, 2017, c. 20, s. 8] Part VI.1 tax (k) the amount determined by multiplying the taxpayer’s tax payable under subsection 191.1(1) for the year by (i) if the taxation year ends before 2010, 3, (ii) if the taxation year ends after 2009 and before 2012, 3.2, and (iii) if the taxation year ends after 2011, 3.5. Election by particular qualifying person (1.1) For the purpose of computing the taxable income of a taxpayer for a taxation year, paragraph (1)(d) shall be read without reference to its subparagraph (i) in respect of a right granted to the taxpayer under an agreement to sell or issue securities referred to in subsection 7(1) if (a) the particular qualifying person elects in prescribed form that neither the particular qualifying person nor any person not dealing at arm’s length with the particular qualifying person will deduct in computing its income for a taxation year any amount (other than a designated amount described in subsection (1.2)) in respect of a payment to or for the benefit of a taxpayer for the taxpayer’s transfer or disposition of that right; (b) the particular qualifying person files the election with the Minister; (c) the particular qualifying person provides the taxpayer or, if the taxpayer is deceased, the graduated rate estate of the taxpayer, with evidence in writing of the election; and (d) the taxpayer or, if the taxpayer is deceased, the graduated rate estate of the taxpayer, files the evidence with the Minister with the taxpayer’s return of income for the year in which a deduction under paragraph (1)(d) is claimed. Designated amount (1.2) For the purposes of subsections (1.1) and (1.44), an amount is a designated amount if the following conditions are met: (a) the amount would otherwise be deductible in computing the income of the particular qualifying person in the absence of subsections (1.1) and (1.44); (b) the amount is payable to a person (i) with whom the particular qualifying person deals at arm’s length, and (ii) who is neither an employee of the particular qualifying person nor of any person not dealing at arm’s length with the particular qualifying person; and (c) the amount is payable in respect of an arrangement entered into for the purpose of managing the particular qualifying person’s financial risk associated with a potential increase in value of the securities under the agreement described in subsection (1.1) or (1.44). Determination of non-qualified securities (1.3) Subsection (1.31) applies to a taxpayer in respect of an agreement if (a) a particular qualifying person agrees to sell or issue securities of the particular qualifying person (or another qualifying person that does not deal at arm’s length with the particular qualifying person) to the taxpayer under the agreement; (b) at the time the agreement is entered into (in this subsection and subsection (1.31) referred to as the “relevant time”), the taxpayer is an employee of the particular qualifying person or of a qualifying person that does not deal at arm’s length with the particular qualifying person; and (c) at the relevant time, any of the following persons is a specified person: (i) the particular qualifying person, (ii) the other qualifying p