Income Tax Act — I-3.3 138
’s income for its base year if (a) the International Financial Reporting Standards that applied to the insurer in valuing its assets and liabilities for its transition year had applied to it for its base year, and (b) sections 1400 and 1402 of the Income Tax Regulations were read in respect of the insurer’s base year as they read in respect of its transition year, G is the amount included under paragraph (4)(b) (as it read in its application to taxation years that begin before 2023) in computing the insurer’s income for its base year in respect of its life insurance policies, and H is the amount included under paragraph 12(1)(e.1) in computing the insurer’s income for its base year; ( montant transitoire ) segregated fund has the meaning given that expression in subsection 138.1(1); ( fonds réservé ) specified Canadian risk has the same meaning as in paragraph 95(2)(a.23); ( risques canadiens déterminés ) surplus funds derived from operations of an insurer as of the end of a particular taxation year means the amount determined by the formula (A + B + C) – (D + E + F + G) where A is the total of the insurer’s income for each taxation year in the period beginning with its 1969 taxation year and ending with the particular year from all insurance businesses carried on by it, B is the total of all amounts each of which is a portion of a non-capital loss that was deemed by subsection 111(7.1) as it read in its application to the 1976 taxation year to have been deductible in computing the insurer’s income for a taxation year that ended before 1977, C is the total of all profits or gains made by the insurer in the period in respect of non-segregated property of the insurer disposed of by it that was used by it in, or held by it in the course of, carrying on an insurance business in Canada, except to the extent that those profits or gains have been or are included in computing the insurer’s income or loss, if any, for any taxation year in the period from carrying on an insurance business, D is the total of its loss, if any, for each taxation year in the period from all insurance businesses carried on by it, E is the total of all losses sustained by the insurer in the period in respect of non-segregated property disposed of by it that was used by it in, or held by it in the course of, carrying on an insurance business in Canada, except to the extent that those losses have been or are included in computing the insurer’s income or loss, if any, for any taxation year in the period from carrying on an insurance business, F is the total of (a) all taxes payable under this Part by the insurer, and all income taxes payable by it under the laws of each province, for each taxation year in the period, except such portion thereof as would not have been payable by it if subsection 138(7) had not been enacted, and (b) all taxes payable under Parts I.3 and VI by the insurer for each taxation year in the period, and G is the total of all gifts made in the period by the insurer to a qualified donee; ( fonds excédentaire résultant de l’activité ) transition year of an insurer means the insurer’s first taxation year that begins after 2022. ( année transitoire ) Assets and liabilities (12.1) For greater certainty, in determining the amount of (a) the contractual service margin, liability for incurred claims and liability for remaining coverage for a group of insurance contracts of an insurer, the amount is (i) a positive amount if the amount is reported as a liability, and (ii) a negative amount if the amount is reported as an asset; and (b) the contractual service margin and reinsurance contract held amount for a group of reinsurance contracts held by an insurer, the amount is (i) a positive amount if the amount is reported as an asset, and (ii) a negative amount if the amount is reported as a liability. IFRS reference (12.2) Except as otherwise provided, references to International Financial Reporting Standards in this section refer to the International