Income Tax Act — I-3.3 147
plan, on that date. Contribution limits (5.1) For the purposes of subsections 147(2.1) and 147(9) and paragraph 147(14)(c.4), the requirements of this subsection in respect of a deferred profit sharing plan are satisfied for a calendar year if, in the case of each beneficiary under the plan and each employer in respect of whom the beneficiary’s pension credit (as prescribed by regulation) for the year under the plan is greater than nil, (a) the total of all amounts each of which is the beneficiary’s pension credit (as prescribed by regulation) for the year in respect of the employer under a deferred profit sharing plan does not exceed the lesser of (i) 1/2 of the money purchase limit for the year, and (ii) 18% of the amount that would be the beneficiary’s compensation (within the meaning assigned by subsection 147.1(1)) from the employer for the year if the definition compensation in subsection 147.1(1) were read without reference to paragraph (b) of that definition; (b) the total of all amounts each of which is the beneficiary’s pension credit (as prescribed by regulation) for the year under a deferred profit sharing plan in respect of (i) the employer, or (ii) any other employer who, at any time in the year, does not deal at arm’s length with the employer does not exceed 1/2 of the money purchase limit for the year; and (c) the total of (i) the beneficiary’s pension adjustment for the year in respect of the employer, and (ii) the total of all amounts each of which is the beneficiary’s pension adjustment for the year in respect of any other employer who, at any time in the year, does not deal at arm’s length with the employer does not exceed the lesser of (iii) the money purchase limit for the year, and (iv) 18% of the total of all amounts each of which is the beneficiary’s compensation (within the meaning assigned by subsection 147.1(1)) for the year from the employer or any other employer referred to in subparagraph 147(5.1)(c)(ii). (5.11) [Repealed, 2013, c. 34, s. 301] Deferred plan not employees profit sharing plan (6) For a period during which a plan is a deferred profit sharing plan, the plan shall be deemed, for the purposes of this Act, not to be an employees profit sharing plan. No tax while trust governed by plan (7) No tax is payable under this Part by a trust on the taxable income of the trust for a period during which the trust was governed by a deferred profit sharing plan. Amount of employer’s contribution deductible (8) Subject to subsection 147(9), there may be deducted in computing the income of an employer for a taxation year the total of all amounts each of which is an amount paid by the employer in the year or within 120 days after the end of the year to a trustee under a deferred profit sharing plan for the benefit of the employer’s employees who are beneficiaries under the plan, to the extent that the amount was paid in accordance with the terms of the plan and was not deducted in computing the employer’s income for a preceding taxation year. Limitation on deduction (9) Where the requirements of subsection 147(5.1) in respect of a deferred profit sharing plan are not satisfied for a calendar year by reason that the pension credits of a beneficiary under the plan in respect of a particular employer do not comply with paragraph 147(5.1)(a) or the beneficiary’s pension credits or pension adjustments in respect of a particular employer and other employers who do not deal at arm’s length with the particular employer do not comply with paragraph 147(5.1)(b) or 147(5.1)(c), the particular employer is not entitled to a deduction under subsection 147(8) in computing the particular employer’s income for any taxation year in respect of an amount paid to a trustee under the plan in the calendar year except to the extent expressly permitted in writing by the Minister, and, for the purposes of this subsection, an amount paid to a trustee of a deferred profit sharing plan in the first two months of a calendar year sh