Income Tax Act — I-3.3 12
omputing the taxpayer’s income throughout the period in which the taxpayer held an interest in, or for civil law a right in, the obligation, the income accrued on it for those intervals, (j) an obligation in respect of a net income stabilization account, (k) an indexed debt obligation, and (l) a prescribed contract. ( contrat de placement ) Flipped property — deemed business (12) For the purposes of this Act, if, absent this subsection and paragraph 40(2)(b), a taxpayer would have had a gain from the disposition of a flipped property, then throughout the period that the taxpayer owned the flipped property (a) the taxpayer is deemed to carry on a business that is an adventure or concern in the nature of trade with respect to the flipped property; (b) the flipped property is deemed to be inventory of the taxpayer’s business; and (c) the flipped property is deemed not to be capital property of the taxpayer. Definition of flipped property (13) For the purposes of subsections (12) and (14), a flipped property of a taxpayer means a property (other than a property, or a right to acquire property, that would be inventory of the taxpayer if the definition inventory in subsection 248(1) were read without reference to subsection (12)) that is (a) prior to its disposition by the taxpayer, either (i) a housing unit located in Canada, or (ii) a right to acquire a housing unit located in Canada; and (b) owned or, in the case of a right to acquire, held, by the taxpayer for less than 365 consecutive days prior to its disposition, other than a disposition that can reasonably be considered to occur due to, or in anticipation of, one or more of the following events: (i) the death of the taxpayer or a person related to the taxpayer, (ii) one or more persons related to the taxpayer becoming a member of the taxpayer’s household or the taxpayer becoming a member of the household of a related person, (iii) the breakdown of the marriage or common-law partnership of the taxpayer if the taxpayer has been living separate and apart from their spouse or common-law partner for at least 90 days prior to the disposition, (iv) a threat to the personal safety of the taxpayer or a related person, (v) the taxpayer or a related person suffering from a serious illness or disability, (vi) an eligible relocation of the taxpayer or the taxpayer’s spouse or common-law partner, if the definition eligible relocation were read without reference to the requirements for the new work location and the new residence to be in Canada, (vii) an involuntary termination of the employment of the taxpayer or the taxpayer’s spouse or common-law partner, (viii) the insolvency of the taxpayer, or (ix) the destruction or expropriation of the property. Flipped property — loss denial (14) For the purposes of this Part, a taxpayer’s loss from a business in respect of a flipped property is deemed to be nil. [NOTE: Application provisions are not included in the consolidated text; see relevant amending Acts and regulations.] R.S., 1985, c. 1 (5th Supp.), s. 12; 1994, c. 7, Sch. II, s. 7, Sch. VI, s. 2, Sch. VIII, s. 3, c. 21, s. 6; 1995, c. 3, s. 2, c. 21, s. 76; 1996, c. 21, s. 4; 1997, c. 10, s. 268, c. 25, s. 2, c. 26, s. 82; 1998, c. 19, ss. 2 and 71; 1999, c. 22, s. 5; 2001, c. 17, s. 5; 2003, c. 28, s. 1; 2007, c. 35, s. 9; 2009, c. 2, s. 4; 2010, c. 25, s. 4; 2012, c. 31, s. 4; 2013, c. 34, ss. 2, 91, 173, c. 40, s. 4; 2014, c. 39, s. 2; 2017, c. 33, s. 4 2022, c. 19, s. 2 2023, c. 26, s. 4 2024, c. 15, s. 2 2024, c. 17, s. 5 2024, c. 17, s. 80 2026, c. 3, s. 2