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Statutes of Newfoundland 1997


CHAPTER 15

CHAPTER 15

AN ACT TO AMEND THE INCOME TAX ACT

(Assented to December 5, 1997)

Analysis

1. Ss.4.2, 4.3, 4.4 and 4.5 Added
4.2 Harmonized sales tax credit
4.3 No set off
4.4 Date on which amount applied
4.5 Application

2. S.13 R&S
Returns of income, assessments and withholding

3. S.14 R&S
Reassessment

4. S.18 R&S
Returns, payment
and interest

5. S.24 Amdt.
Refunds

6. S.25 R&S
Objections

7. S.26 Amdt.
Appeals

8. Commencement

Be it enacted by the Lieutenant-Governor and House of Assembly in Legislative Session convened, as follows:


RSN1990 cI-1 as amended

1. The Income Tax Act is amended by adding immediately after section 4.1 the following:

Harmonized sales tax credit

4.2 (1) In this section

(a) "adjusted income", "qualified dependant" and "qualified relation" have the meanings assigned to them under subsection 122.5(1) of the Federal Act; and

(b) "eligible individual" for a taxation year means an individual, other than a trust, who at the end of December 31 of that year is resident in the province and is

(i) married,

(ii) a parent of a child, or

(iii) 19 years of age or over.

(2) Notwithstanding subsection (1), a person is not considered to be an eligible individual or a qualified relation or qualified dependant of an individual for a taxation year where that person

(a) dies before the end of the year;

(b) at the end of the year is a person described in paragraph 149(1)(a) or (b) of the Federal Act; or

(c) at the end of the year is confined to a prison or similar institution and has been so confined for a period of or periods, the total of which in the year was more than 6 months.

(3) Where a return of income is filed under Part I of the Federal Act for a taxation year in respect of an eligible individual and that individual has applied under subsection 122.5(3) of the Federal Act, the amount by which the total of

(a) $40;

(b) $40 for a person who is the qualified relation of the individual for the year; and

(c) the product obtained when $60 is multiplied by the number of qualified dependants of the individual for the year,

exceeds

(d) 5% of the amount by which

(i) the individualís adjusted income for the year

exceeds

(ii) $15,000

is considered to be an amount paid by the individual on account of the individualís tax payable under this Act for that year during the month of October of the immediately following taxation year.

(4) Subsection (3) shall not apply to a return of income filed by an individual under subsection 70(2), paragraph 104(23)(d) or 128(2)(e) or subsection 150(4) of the Federal Act.

(5) Notwithstanding subsection (3),

(a) where an individual is a qualified relation of another individual for a taxation year, only the individual who applied under subsection 122.5(3) of the Federal Act and received an amount considered under that subsection to be an amount paid by that individual on account of that individualís tax payable under that Act for that year is eligible to be paid the amount considered under subsection (3) to be an amount paid by the individual on account of his or her tax payable under this Act for that year; and

(b) an amount is not considered to be paid under that subsection by an individual for a taxation year during the month of October of the immediately following taxation year where the individual

(i) died before that month,

(ii) was not resident in Canada at the beginning of that month, or

(iii) was not resident in the province at the beginning of the month of June of the immediately following taxation year.

(6) Notwithstanding paragraph (5)(b), upon written application made under subsection 122.5(6) of the Federal Act by an individual who

(a) is the deceased individualís qualified relation for the taxation year in respect of which a payment under this section would, but for that paragraph, be made; and

(b) is not an individual to whom that paragraph applies,

each amount that, but for that paragraph, would be considered under subsection (3) to be an amount paid by the deceased individual on account of the individualís tax payable under this Act for that year is considered to be paid under that subsection on account of that individualís tax payable under this Act for that year.

(7) For the purpose of this section, where, in a taxation year, an individual becomes bankrupt, the individualís income for the year shall include his or her income for the taxation year that begins on January 1 of the calendar year that includes the date of the bankruptcy.

No set off

4.3 (1) Notwithstanding section 24 of this Act, subsection 164(2) of the Federal Act does not apply to an amount considered under subsection 4.2(3) of this Act to be an amount paid by an individual on account of his or her tax payable under this Act for a taxation year.

(2) Subsection (1) does not apply where the taxpayers liability referred to in subsection 164(2) of the Federal Act arose from the operation of paragraph 160.1(1)(a) of the Federal Act with respect to an amount refunded to the taxpayer in excess of the amount to which the taxpayer was entitled under subsection 4.2(3) of this Act.

Date on which amount applied

4.4 Where a taxpayer has requested that an amount, considered under subsection 4.2(3) of this Act to be an amount paid by an individual on account of his or her tax payable under this Act for a taxation year, be applied to a liability of the taxpayer and the taxpayerís return of income for the year is filed on or before the day it was required by section 150 of the Federal Act to be filed, the amount shall be considered to have been applied on the day on which it would have been refunded if the taxpayer were not liable to make a payment to Her Majesty in right of Canada.

Application

4.5 (1) For greater certainty, for the purpose of applying paragraph 2(7)(c) of this Act, section 122.5 of the Federal Act is considered to be the same as or similar to section 4.2 of this Act.

(2) Section 4.2 of the Act applies with respect to amounts considered to be amounts paid by individuals on account of their tax payable under this Act for taxation years after 1995.

(3) Notwithstanding subsection (2), for the purpose of considering amounts to have been paid by individuals on account of their tax payable under this Act for the 1996 taxation year, the references to the month of October in subsections 4.2(3) and (5) of the Act, shall be read as references to the month of December.

2. Section 13 of the Act is repealed and the following substituted:

Returns of income, assessments and withholding

13. Sections 150 and 151 and subsections 152(1), (2), (3), (4), (4.1), (4.2), (4.3), (5), (6), (7), and (8) and subsections 153(1), (1.1), (1.2), and (3) of the Federal Act apply for the purpose of this Act.

3. Section 14 of the Act is repealed and the following substituted:

Reassessment

14. (1) Where a collection agreement is in effect, notwithstanding that more than 3 years have elapsed since the day of mailing a notice of an original assessment of tax, interest or penalties payable by a taxpayer for a taxation year or of a notification that no tax is payable by the taxpayer for the year, where the tax payable under Part I of the Federal Act by the taxpayer for the year is reassessed, the Minister of Finance shall reassess, make additional assessments or assess tax, interest or penalties as the circumstances require.

(2) Notwithstanding that the normal reassessment period for a taxpayer has elapsed, the Minister of Finance may redetermine the amount considered under subsection 4.2(3) to be an amount paid by the individual on account of his or her tax payable under this Act for that year.

4. Section 18 of the Act is repealed and the following substituted:

Returns, payments and interest

18. Subsection 70(2), subsection 104(2), paragraph 104(23)(e), sections 158, 159 and 160, subsections 160.1(1), (1.1), (3) and (4), sections 160.2 and 160.3 and subsections 161(1), (2), (2.1), (2.2), (4), (4.1), (5), (6), (6.1), (7), (9) and (11) of the Federal Act apply for the purpose of this Act.

5. Subsection 24(1) of the Act is repealed and the following substituted:

Refunds

24. (1) Subsections 164(1), (1.1), (1.2), (1.3), (1.31), (1.5), (2), (3), (3.1), (4), (5.1), (6) and (7) of the Federal Act apply for the purpose of this Act.

6. Section 25 of the Act is repealed and the following substituted:

Objections

25. Sections 165, 166.1 and 166.2 of the Federal Act apply for the purpose of this Act.

7. Paragraph 26(2)(a) of the Act is repealed and the following substituted:

(a) in the case of an individual, to the determination of

(i) his or her residence for the purpose of this Act,

(ii) his or her income earned in the taxation year in the province as defined in paragraph 4(12)(b),

(iii) the amount of tax payable for a taxation year based on the tax payable under the Federal Act for that year as defined in paragraph 4(12)(a), or

(iv) the amount that, by subsection 122.5 of the Federal Act as it applies for the purpose of section 4.2 of this Act, is considered to be his or her adjusted income; and

Commencement

8. This Act is considered to have come into force on April 1, 1997.

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