Income Tax Act — I-3.3 122.3
Overseas employment tax credit 122.3 (1) If an individual is resident in Canada in a taxation year and, throughout any period of more than six consecutive months that began before the end of the year and included any part of the year (in this section referred to as the “qualifying period”) (a) was employed by a person who was a specified employer, other than for the performance of services under a prescribed international development assistance program of the Government of Canada, and (b) performed all or substantially all the duties of the individual’s employment outside Canada (i) in connection with a contract under which the specified employer carried on business outside Canada with respect to (A) the exploration for or exploitation of petroleum, natural gas, minerals or other similar resources, (B) any construction, installation, agricultural or engineering activity, or (C) any prescribed activity, or (ii) for the purpose of obtaining, on behalf of the specified employer, a contract to undertake any of the activities referred to in clause 122.3(1)(b)(i)(A), 122.3(1)(b)(i)(B) or 122.3(1)(b)(i)(C), there may be deducted, from the amount that would, but for this section, be the individual’s tax payable under this Part for the year, an amount equal to that proportion of the tax otherwise payable under this Part for the year by the individual that the lesser of (c) an amount equal to that proportion of the specified amount for the year that the number of days (i) in that portion of the qualifying period that is in the year, and (ii) on which the individual was resident in Canada is of 365, and (d) the specified percentage for the year of the individual’s income for the year from that employment that is reasonably attributable to duties performed on the days referred to in paragraph (c) is of (e) the amount, if any, by which (i) if the individual is resident in Canada throughout the year, the individual’s income for the year, and (ii) if the individual is non-resident at any time in the year, the amount determined under paragraph 114(a) in respect of the taxpayer for the year exceeds (iii) the total of all amounts each of which is an amount deducted under section 110.6 or paragraph 111(1)(b), or deductible under paragraph 110(1)(d.2), (d.3), (f) or (g), in computing the individual’s taxable income for the year. Specified amount (1.01) For the purposes of paragraph (1)(c), the specified amount for a taxation year of an individual is (a) for the 2013 to 2015 taxation years, the amount determined by the formula [$80,000 × A/(A + B)] + [C × B/(A + B)] where A is the individual’s income described in paragraph (1)(d) for the taxation year that is earned in connection with a contract that was committed to in writing before March 29, 2012 by a specified employer of the individual, B is the individual’s income described in paragraph (1)(d) for the taxation year, other than income included in the description of A, and C is (i) for the 2013 taxation year, $60,000, (ii) for the 2014 taxation year, $40,000, and (iii) for the 2015 taxation year, $20,000; and (b) for the 2016 and subsequent taxation years, nil. Specified percentage (1.02) For the purposes of paragraph (1)(d), the specified percentage for a taxation year of an individual is (a) for the 2013 to 2015 taxation years, the amount determined by the formula [80% × A/(A + B)] + [C × B/(A + B)] where A is the value of A in subsection (1.01), B is the value of B in subsection (1.01), and C is (i) for the 2013 taxation year, 60%, (ii) for the 2014 taxation year, 40%, and (iii) for the 2015 taxation year, 20%; and (b) for the 2016 and subsequent taxation years, 0%. Excluded income (1.1) No amount may be included under paragraph (1)(d) in respect of an individual’s income for a taxation year from the individual’s employment by an employer (a) if (i) the employer carries on a business of providing services and does not employ in the business throughout the year more than five full-time emplo