Income Tax Act — I-3.3 126
eductible under subsection (2) in respect of that country in computing the taxpayer’s tax payable under this Part for the year. ( fraction inutilisée du crédit pour impôt étranger ) Deemed dividend — partnership (8) If an amount is deemed by subsection 96(1.11) to be a taxable dividend received by a person in a taxation year of the person in respect of a partnership, and it is reasonable to consider that all or part of the amount (in this subsection referred to as the “foreign-source portion”) is attributable to income of the partnership from a source in a country other than Canada, the person is deemed for the purposes of this section to have an amount of income from that source for that taxation year equal to the amount determined by the formula A × B/C where A is the total amount included under subsection 82(1) in computing the income of the person in respect of the taxable dividend for that taxation year; B is the foreign-source portion; and C is the amount of the taxable dividend deemed to be received by the person. Computation of qualifying incomes and losses (9) The qualifying incomes and qualifying losses for a taxation year of a taxpayer from sources in a country shall be determined (a) without reference to (i) any portion of income that was deductible under subparagraph 110(1)(f)(i) in computing the taxpayer’s taxable income, (ii) for the purpose of subparagraph (1)(b)(i), any portion of income in respect of which an amount was deducted under section 110.6, 110.61 or 110.62 in computing the taxpayer’s income, or (iii) any income or loss from a source in the country if any income of the taxpayer from the source would be tax-exempt income; and (b) as if the total of all amounts each of which is that portion of an amount deducted under subsection 66(4), 66.21(4), 66.7(2) or 66.7(2.3) in computing those qualifying incomes and qualifying losses for the year that applies to those sources were the greater of (i) the total of all amounts each of which is that portion of an amount deducted under subsection 66(4), 66.21(4), 66.7(2) or 66.7(2.3) in computing the taxpayer’s income for the year that applies to those sources, and (ii) the total of (A) the portion of the maximum amount that would be deductible under subsection 66(4) in computing the taxpayer’s income for the year that applies to those sources if the amount determined under subparagraph 66(4)(b)(ii) for the taxpayer in respect of the year were equal to the amount, if any, by which the total of (I) the taxpayer’s foreign resource income (within the meaning assigned by subsection 66.21(1)) for the year in respect of the country, determined as if the taxpayer had claimed the maximum amounts deductible for the year under subsections 66.7(2) and (2.3), and (II) all amounts each of which would have been an amount included in computing the taxpayer’s income for the year under subsection 59(1) in respect of a disposition of a foreign resource property in respect of the country, determined as if each amount determined under subparagraph 59(1)(b)(ii) were nil, exceeds (III) the total of all amounts each of which is a portion of an amount (other than a portion that results in a reduction of the amount otherwise determined under subclause (I)) that applies to those sources and that would be deducted under subsection 66.7(2) in computing the taxpayer’s income for the year if the maximum amounts deductible for the year under that subsection were deducted, (B) the maximum amount that would be deductible under subsection 66.21(4) in respect of those sources in computing the taxpayer’s income for the year if (I) the amount deducted under subsection 66(4) in respect of those sources in computing the taxpayer’s income for the year were the amount determined under clause (A), (II) the amounts deducted under subsections 66.7(2) and (2.3) in respect of those sources in computing the taxpayer’s income for the year were the maximum amounts deductible under those subsections, (III) for the