Income Tax Act — I-3.3 211.1
Tax payable 211.1 (1) Every life insurer shall pay a tax under this Part for each taxation year equal to 15% of its taxable Canadian life investment income for the year. Taxable Canadian life investment income (2) For the purposes of this Part, the taxable Canadian life investment income of a life insurer for a taxation year is the amount, if any, by which its Canadian life investment income for the year exceeds the total of its Canadian life investment losses for the 20 taxation years immediately preceding the year, to the extent that those losses were not deducted in computing its taxable Canadian life investment income for any preceding taxation year. Canadian life investment income (3) For the purposes of this Part, the Canadian life investment income or loss of a life insurer for a taxation year is the positive or negative amount determined by the formula A + B - C where A is subject to subsection 211.1(4), the total of all amounts, each of which is in respect of a liability, benefit, risk or guarantee under a life insurance policy that was at any time in the year a taxable life insurance policy of the insurer, determined by multiplying the net interest rate in respect of the liability, benefit, risk or guarantee for the year by 1/2 of the total of (a) the maximum amount that would be determined under paragraph 1401(1)(a), (c) or (d) of the Income Tax Regulations (other than an amount that would be determined under subparagraph 1401(1)(d)(ii) of those Regulations in respect of a disabled life) in respect of the insurer for the year in respect of the liability, benefit, risk or guarantee if subsection 1401(1) of those Regulations applied to all life insurance policies and if that amount were determined without reference to any policy loan or reinsurance arrangement, and (b) the maximum amount that would be determined under paragraph 1401(1)(a), (c) or (d) of the Income Tax Regulations (other than an amount that would be determined under subparagraph 1401(1)(d)(ii) of those Regulations in respect of a disabled life) in respect of the insurer for the preceding taxation year in respect of the liability, benefit, risk or guarantee if subsection 1401(1) of those Regulations applied to all life insurance policies and if that amount were determined without reference to any policy loan or reinsurance arrangement; B is the total of all amounts, each of which is the positive or negative amount in respect of a life insurance policy that was at any time in the year a taxable life insurance policy of the insurer, determined by the formula D - E where D is, subject to subsection 211.1(4), the amount determined by multiplying the percentage determined in the description of A in the definition net interest rate in subsection 211(1) in respect of the year by 1/2 of the total of (a) the maximum amount that would be determined under paragraph 1401(1)(c.1) of the Income Tax Regulations in respect of the insurer for the year in respect of the policy if subsection 1401(1) of those Regulations applied to all life insurance policies and if that amount were determined without reference to any policy loan or reinsurance arrangement, and (b) the maximum amount that would be determined under paragraph 1401(1)(c.1) of the Income Tax Regulations in respect of the insurer for the preceding taxation year in respect of the policy if subsection 1401(1) of those Regulations applied to all life insurance policies and if that amount were determined without reference to any policy loan or reinsurance arrangement, and E is the amount, if any, by which (a) the total of all amounts determined in respect of the insurer under the description of in respect of the policy for the year and any preceding taxation years ending after 1989 exceeds the total of (b) all amounts determined in respect of the insurer under the description of E in respect of the policy for taxation years ending before the year, and (c) the amount, if any, by which (i) the maximum amount that wou