• Service: Tax, Global Transfer Pricing Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 10/30/2013

Canada - Federal Budget 2013 measures substantively enacted 22 October 

October 30: Canada's Federal Budget Bill #2 (Bill C-4) on 22 October 2013 received first reading in the House of Commons.  The bill would enact remaining tax measures from the 2013 federal budget, as well as "certain previously announced tax measures."

The measures contained in the bill are considered substantively enacted as of 22 October 2013 for purposes of IFRS and Accounting Standards for Private Enterprises.

The bill also includes measures that correct an unintended technical glitch in the credit union legislation (originally in the 2013 Federal Budget Bill #1 (Bill C-60)).

Tax provisions in the legislation

The bill includes 2013 federal budget measures that:

  • Increase and index the Lifetime Capital Gains Exemption
  • Expand accelerated capital cost allowance to further encourage investments in clean energy generation
  • Provide that synthetic disposition transactions are taxed as actual dispositions
  • Provide that income from character conversion transactions is taxed appropriately
  • Provide that the tax attributes of trusts cannot be inappropriately transferred among arm's length persons
  • Amend the rules that apply to non-resident trusts
  • Eliminate unintended tax benefits from two types of leveraged life insurance arrangements
  • Restrict corporate loss trading among arm's length persons

Read an October 2013 report prepared by the KPMG member firm in Canada: Federal Budget Bill #2 Receives First Reading

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