Income Tax Regulations — 1900
R in respect of the policy for taxation years ending before the year, and (c) the maximum amount that would be deductible under subparagraph 138(3)(a)(i) of the Act pursuant to paragraph 1401(1)(c.1) in respect of the policy in computing the insurer’s income for the year, if that amount were determined without reference to any reinsurance arrangement. (6) The amount of the term insurance component in the description of E in subsection 211.1(3) of the Act, as it read in its application to taxation years beginning before 1990, in respect of a life insurer for a taxation year is determined by the formula A + B + C - D + E - F + G + H where A is the amount determined by multiplying 0.0035 by the total of all amounts each of which is the amount of new insurance effected in the year (other than amounts rescinded in the year) under a taxable life insurance policy of the insurer; B is the amount determined by multiplying 0.0002 by 1/2 of the total of (a) all amounts of insurance in force at the end of the year under taxable life insurance policies of the insurer (other than paid-up policies), and (b) all amounts of insurance in force at the end of the immediately preceding taxation year under taxable life insurance policies of the insurer (other than paid-up policies); C is the amount determined by multiplying 0.20 by the net cost of insurance in respect of the insurer for the year; D is the greater of (a) the lesser of $2,500,000 and the amount, if any, by which (i) the total of the amounts determined under the descriptions of A, B, C and E in respect of the insurer for the year exceeds (ii) 50 per cent of the amount that would be determined under the description of N in subsection (5) in respect of the insurer for the year, if that amount were determined without reference to any reinsurance arrangement, and (b) the amount, if any, by which (i) the total of the amounts determined under the descriptions of A, B, C and E in respect of the insurer for the year exceeds (ii) 75 per cent of the amount that would be determined under the description of N in subsection (5) in respect of the insurer for the year, if that amount were determined without reference to any reinsurance arrangement; E is the amount determined under the description of D in respect of the insurer for the immediately preceding taxation year; F is such amount as the insurer may claim, not exceeding the positive amount, if any, determined by adding (a) the mortality experience of the insurer for the year, and (b) the amount determined under the description of G in respect of the insurer for the year; G is the mortality loss adjustment account of the insurer for the immediately preceding year; and H is 1 per cent of the total of all amounts each of which is the amount of a premium that has become receivable by the insurer in the year under a taxable life insurance policy of the insurer in respect of which a positive amount of guaranteed interest is determined for the year under subsection (8). (7) The amount of the amortization adjustment amount in the description of E in subsection 211.1(3) of the Act, as it read in its application to taxation years beginning before 1990, in respect of a life insurer for a taxation year is determined by the formula (A - B) - (C - D) where A is the total of all amounts each of which is the amount that would be the net level premium reserve for the year in respect of a taxable life insurance policy of the insurer (other than a policy in respect of which a positive amount of guaranteed interest is determined for the year under subsection (8)), if that amount were determined without reference to any policy loan or reinsurance agreement; B is the total of all amounts each of which is the amount that would be the net level premium reserve for the immediately preceding taxation year in respect of a taxable life insurance policy of the insurer (other than a policy in respect of which a positive amount of guaranteed interest is determined for the