Income Tax Act — I-3.3 129
a corporation, for the purpose of determining the amount under paragraph (a) of the definition eligible refundable dividend tax on hand in subsection (4), in respect of the corporation at the end of the year, the amount determined under subsection 186(1) in respect of the corporation for the year is deemed to be the amount determined by the formula A + B − C where A is the amount determined under paragraph 186(1)(a) in respect of the corporation for the year in respect of eligible dividends; B is the amount determined under paragraph 186(1)(b) in respect of the corporation for the year in respect of dividends that resulted in dividend refunds from the eligible refundable dividend tax on hand of other corporations; and C is the amount determined by the formula 38 1/3% (D + E) − (F + G) where D is the amount claimed by the corporation under paragraph 186(1)(c) for the year, E is the amount claimed by the corporation under paragraph 186(1)(d) for the year, F is the amount determined under paragraph 186(1)(a) in respect of the corporation for the year in respect of taxable dividends (other than eligible dividends), and G is the amount determined under paragraph 186(1)(b) in respect of the corporation for the year in respect of dividends that resulted in dividend refunds from the non-eligible refundable dividend tax on hand of other corporations. (4.3) [Repealed, 1996, c. 21, s. 32] 2019 transitional RDTOH (5) The following rules apply to a corporation’s first taxation year in respect of which the definition eligible refundable dividend tax on hand in subsection (4) applies: (a) if the corporation is a Canadian-controlled private corporation throughout the taxation year and its preceding taxation year and is not a corporation in respect of which an election under subsection 89(11) applies to the taxation year or the preceding taxation year, (i) for the purpose of applying paragraph (b) of the definition eligible refundable dividend tax on hand in respect of the corporation at the end of the taxation year, the corporation’s eligible refundable dividend tax on hand at the end of its preceding taxation year is deemed to be the amount, if any, that is the lesser of (A) the amount determined by the formula A − B where A is the corporation’s refundable dividend tax on hand at the end of its preceding taxation year, and B is the corporation’s dividend refund for its preceding taxation year, and (B) the amount determined by the formula (C − D) × E where C is the corporation’s general rate income pool at the end of its preceding taxation year, D is the amount, if any, by which (I) the total of all amounts each of which is an eligible dividend paid by the corporation in its preceding taxation year exceeds (II) the total of all amounts each of which is an excessive eligible dividend designation made by the corporation in its preceding taxation year, and E is 38 1/3%, and (ii) for the purpose of applying paragraph (c) of the definition non-eligible refundable dividend tax on hand in respect of the corporation at the end of the taxation year, the corporation’s non-eligible refundable dividend tax on hand at the end of its preceding taxation year is deemed to be the amount determined by the formula A − B where A is the amount determined under clause (a)(i)(A) in respect of the corporation at the end of the preceding taxation year, and B is the amount determined under clause (a)(i)(B) in respect of the corporation at the end of the preceding taxation year; and (b) in any other case, for the purpose of applying paragraph (b) of the definition eligible refundable dividend tax on hand in respect of the corporation at the end of the taxation year, the corporation’s eligible refundable dividend tax on hand at the end of its preceding taxation year is deemed to be the amount that would be determined for clause (a)(i)(A) if paragraph (a) applied to the corporation in respect of the taxation year. 2019 transitional RDTOH — amalgamations (5.1) Subsection