Income Tax Act — I-3.3 113
1975 taxation year and before the particular time as are deductible under paragraph 113(1)(d) in computing the taxable income of the corporation for taxation years ending after 1975, (iii.1) the total of all amounts received by the corporation on the share after the end of its 1975 taxation year and before the particular time (A) on a reduction, before August 20, 2011, of the paid-up capital of the foreign affiliate in respect of the share, or (B) on a reduction, after August 19, 2011, of the paid-up capital of the foreign affiliate in respect of the share that is a qualifying return of capital (within the meaning assigned by subsection 90(3)) in respect of the share, and (iv) the total of all amounts deducted under this subsection in respect of dividends received by the corporation on the share before the particular time. Definitions (3) In this section, deductible , in relation to an amount in respect of a payment, in computing relevant foreign income or profits, has the same meaning as in subsection 18.4(1). ( déductible ) entity has the same meaning as in subsection 95(1). ( entité ) equity interest has the same meaning as in subsection 18.4(1). ( participation au capital ) foreign expense restriction rule has the same meaning as in subsection 18.4(1). ( régle étrangère de restriction des dépenses ) foreign hybrid mismatch rule has the same meaning as in subsection 18.4(1). ( règle étrangère d’asymétrie hybride ) foreign taxation year of an entity has the same meaning as in subsection 18.4(1). ( année d’imposition étrangère ) non-business-income tax paid by a taxpayer has the meaning assigned by subsection 126(7); ( impôt sur le revenu ne provenant pas d’une entreprise ) relevant foreign income or profits of an entity for a foreign taxation year has the same meaning as in subsection 18.4(1). ( revenus ou bénéfices étrangers pertinents ) relevant tax factor has the meaning assigned by subsection 95(1). ( facteur fiscal approprié ) Portion of dividend deemed paid out of exempt surplus (4) Such portion of any dividend received at any time in a taxation year by a corporation resident in Canada on a share owned by it of the capital stock of a foreign affiliate of the corporation, that was received after the 1971 taxation year of the affiliate and before the affiliate’s 1976 taxation year, as exceeds the amount deductible in respect of the dividend under paragraph 113(1)(d) in computing the corporation’s taxable income for the year shall, for the purposes of paragraph 113(1)(a), be deemed to be the portion of the dividend prescribed to have been paid out of the exempt surplus of the affiliate. Deduction restriction (5) Any amount that, in the absence of this subsection, would be a dividend received by a corporation resident in Canada on a share owned by it of the capital stock of a foreign affiliate of the corporation is deemed, for the purposes of this section (other than this subsection), not to be a dividend received by the corporation on a share of the capital stock of the affiliate to the extent of the total of all amounts, each of which, in respect of the dividend, (a) is an amount that is or can reasonably be expected to be deductible in computing (i) relevant foreign income or profits, for a foreign taxation year, of (A) the affiliate, or (B) another entity (other than the corporation) because that entity has a direct or indirect equity interest in the affiliate, or (ii) income or profits of the affiliate that are taken into account in determining relevant foreign income or profits of another entity for a foreign taxation year; or (b) would, in the absence of any foreign hybrid mismatch rule or foreign expense restriction rule, be described in paragraph (a). Deduction for foreign taxes (6) If, for the purposes of this section (other than subsection (5)), all or any portion of a particular amount is deemed by subsection (5) not to be a dividend received by a corporation on a share of the capital stock of a foreign affilia