Income Tax Act — I-3.3 214
 those subsections were read without reference to paragraphs 214(6)(c) and 214(7)(c), the amount, if any, by which (d) the price for which the obligation was assigned or otherwise transferred at the subsequent time, exceeds (e) the price for which the obligation was assigned or otherwise transferred at the particular time, shall, for the purposes of this Part, be deemed to be a payment of interest on that obligation made by the person resident in Canada to the non-resident person at the subsequent time. Meaning of excluded obligation (8) For the purposes of subsection (7), excluded obligation means any bond, debenture, bill, note, mortgage, hypothecary claim or similar obligation (a) that is described in paragraph (a) of the definition fully exempt interest in subsection 212(3), or on which the interest would have been exempt under subparagraph 212(1)(b)(iii) or (vii) as they applied to the 2007 taxation year; (b) that is prescribed to be a public issue security; or (c) that is not an indexed debt obligation and that was issued for an amount not less than 97% of the principal amount thereof, and the yield from which, expressed in terms of an annual rate on the amount for which the obligation was issued (which annual rate shall, if the terms of the obligation or any agreement relating thereto conferred on the holder thereof a right to demand payment of the principal amount of the obligation or the amount outstanding as or on account of the principal amount thereof, as the case may be, before the maturity of the obligation, be calculated on the basis of the yield that produces the highest annual rate obtainable either on the maturity of the obligation or conditional on the exercise of any such right) does not exceed 4/3 of the interest stipulated to be payable on the obligation, expressed in terms of an annual rate on (i) the principal amount thereof, if no amount is payable on account of the principal amount before the maturity of the obligation, and (ii) the amount outstanding from time to time as or on account of the principal amount thereof, in any other case. Deemed resident (9) Where (a) the assignment or other transfer of an obligation to a non-resident person carrying on business in Canada would be described in subsection 214(6) or 214(7) if those subsections were read without reference to paragraphs 214(6)(c) and 214(7)(c) and if that non-resident person were a person resident in Canada, and (b) that non-resident person (i) may deduct, under subsection 20(14), in computing the non-resident person’s taxable income earned in Canada for a taxation year an amount in respect of interest on the obligation, or (ii) may deduct, under Part I, in computing the non-resident person’s taxable income earned in Canada for a taxation year an amount in respect of any amount paid on account of the principal amount of the obligation, the non-resident person shall, with respect to the assignment or other transfer of the obligation, be deemed, for thepurposes of this Part, to be a person resident in Canada. Reduction of tax (10) Where a non-resident person has assigned or otherwise transferred to a person resident in Canada an obligation (a) on which an amount of interest was deemed by subsection 214(6) or 214(7) to have been paid, and (b) that the non-resident person had previously acquired from a person resident in Canada, the amount of the tax under this Part that the non-resident person is liable to pay in respect thereof shall be deemed, for the purpose of subsection 227(6), to be that proportion of the tax the non-resident person would otherwise have been liable to pay in respect thereof that (c) the number of days in the period commencing with the day the obligation was last acquired by the non-resident person from a person resident in Canada and ending with the day the obligation was last assigned or otherwise transferred by the non-resident person to a person resident in Canada is of (d) the number of days in the period commencing