Income Tax Act — I-3.3 160
Interpretation 160 (0.1) In this section and section 160.01, a transaction includes an arrangement or event. Tax liability re property transferred not at arm’s length (1) Where a person has, on or after May 1, 1951, transferred property, either directly or indirectly, by means of a trust or by any other means whatever, to (a) the person’s spouse or common-law partner or a person who has since become the person’s spouse or common-law partner, (b) a person who was under 18 years of age, or (c) a person with whom the person was not dealing at arm’s length, the following rules apply: (d) the transferee and transferor are jointly and severally, or solidarily, liable to pay a part of the transferor’s tax under this Part for each taxation year equal to the amount by which the tax for the year is greater than it would have been if it were not for the operation of sections 74.1 to 75.1 of this Act and section 74 of the Income Tax Act , chapter 148 of the Revised Statutes of Canada, 1952, in respect of any income from, or gain from the disposition of, the property so transferred or property substituted for it, and (e) the transferee and transferor are jointly and severally, or solidarily, liable to pay under this Act an amount equal to the lesser of (i) the amount, if any, by which the fair market value of the property at the time it was transferred exceeds the fair market value at that time of the consideration given for the property, and (ii) the total of all amounts each of which is an amount that the transferor is liable to pay under this Act (including, for greater certainty, an amount that the transferor is liable to pay under this section, regardless of whether the Minister has made an assessment under subsection (2) for that amount) in or in respect of the taxation year in which the property was transferred or any preceding taxation year, but nothing in this subsection limits the liability of the transferor under any other provision of this Act or of the transferee for the interest that the transferee is liable to pay under this Act on an assessment in respect of the amount that the transferee is liable to pay because of this subsection. Joint and several, or solidary, liability — subsection 69(11) (1.1) If a particular person or partnership is deemed by subsection 69(11) to have disposed of a property at any time, the person referred to in that subsection to whom a benefit described in that subsection was available in respect of a subsequent disposition of the property or property substituted for the property is jointly and severally, or solidarily, liable with each other taxpayer to pay a part of the other taxpayer’s liabilities under this Act in respect of each taxation year equal to the amount determined by the formula A - B where A is the total of amounts payable under this Act by the other taxpayer in respect of the year, and B is the amount that would, if the particular person or partnership were not deemed by subsection 69(11) to have disposed of the property, be determined for A in respect of the other taxpayer in respect of the year, but nothing in this subsection limits the liability of the other taxpayer under any other provision of this Act or of any person for the interest that the person is liable to pay under this Act on an assessment in respect of the amount that the person is liable to pay because of this subsection. Joint and several, or solidary, liability — tax on split income (1.2) If an amount is required to be added because of subsection 120.4(2) in computing a specified individual’s tax payable under this Part for a taxation year and the specified individual has not attained the age of 24 years before the start of the year, the following rules apply: (a) subject to paragraph (b), a particular individual is jointly and severally, or solidarily, liable with the specified individual for the amount if (i) where the specified individual has not attained the age of 17 years before the year, the particular indi