Regulations Amending the Income Tax Regulations (Non-application of Presumption – Declaration of Female Parent): SOR/2021-82
Canada Gazette, Part II, Volume 155, Number 9
SOR/2021-82 April 19, 2021
INCOME TAX ACT
P.C. 2021-304 April 19, 2021
His Excellency the Administrator of the Government of Canada in Council, on the recommendation of the Minister of National Revenue, pursuant to section 221 footnote a of the Income Tax Act footnote b, makes the annexed Regulations Amending the Income Tax Regulations (Non-application of Presumption – Declaration of Female Parent).
Regulations Amending the Income Tax Regulations (Non-application of Presumption – Declaration of Female Parent)
1 Paragraph 6301(1)(a) of the Income Tax Regulations footnote 1 is replaced by the following:
- (a) subject to paragraph (c), the female parent of the qualified dependant declares in writing to the Minister that she resides with the other parent of that qualified dependant and that that other parent primarily fulfils the responsibility for the care and upbringing of each of the qualified dependants with whom both parents reside;
Coming into Force
2 These Regulations come into force on July 1, 2021, but if they are registered after that day, they come into force on the day on which they are registered.
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Regulations.)
Section 122.6 of the Income Tax Act (the Act) defines a number of terms for the purposes of the Canada Child Benefit (CCB). In order to be the “eligible individual” of a “qualified dependant,” the individual must be a resident of Canada for tax purposes, must reside with the dependant and must be the parent who primarily fulfills the responsibility for the care and upbringing of the qualified dependant or is a shared-custody parent of the qualified dependant. In households with one female parent, the female parent is presumed to primarily fulfill the care and upbringing of a qualified dependant. As a result, the female parent is presumed to be the “eligible individual” if she resides with the dependant.
Paragraph 6301(1)(a) of the Income Tax Regulations (the Regulations) provides the circumstances where the female presumption may be waived. In households with a female and male parent, the presumption will not apply where the female parent of the “qualified dependant” declares in writing that the male parent with whom she resides is the parent who fulfills the responsibility for the care and upbringing of all of the qualified dependants who reside with both parents.
The Regulations do not allow for the female parent of a household composed of a female parent and a gender-neutral parent to waive the female presumption in right of the gender-neutral parent. This prevents families with this structure from deciding which parent should receive the CCB, unlike other family structures.
In 2016, the Government of Canada introduced a legislative agenda to support its commitment to gender equality, diversity and inclusion. The Treasury Board of Canada Secretariat, in collaboration with the Department of Justice, developed a policy position to introduce a third designation for gender in federal programs and services, and to standardize the collection, use and display of gender information. Federal government departments and agencies that display or collect gender information are moving forward with the introduction of an “unspecified” gender (“X”) for all its official documents. Additionally, in June 2017, the Government of Canada amended the Canadian Human Rights Act and the Criminal Code to add gender identity and expression as prohibited grounds for discrimination.
The Act provides a monthly nontaxable CCB that is payable to an eligible individual in respect of a “qualifying dependant.” The definition of “eligible individual” in paragraph 122.6(f) of the Act states that where a qualified dependant resides with two parents, and one parent is female, the female parent is presumed to primarily fulfill the care and upbringing of a qualified dependant. Consequently, the female parent is presumed to be the eligible individual and the CCB will be issued to the female, regardless of whether a male or gender-neutral parent applies for the CCB. This includes households where the parents are married or common law.
Paragraph 122.6(g) of the Act states that the female presumption can be waived under certain situations that are set out in the Regulations. Paragraph 6301(1)(a) of the Regulations allows a female parent to waive the female presumption in right of a male parent. By doing so, the female parent designates the male parent as the eligible individual for purposes of the CCB.
The female presumption applies to households with a female and a gender-neutral parent, but under the Regulations, a female parent cannot waive female presumption in order to designate a gender-neutral parent as the eligible individual. The CCB payment will be issued to the female parent regardless of the parent who applied.
The female presumption does not apply to other household structures. In the case of two same-sex male parents, two gender-neutral parents, and one male and one gender-neutral parent, the female presumption will not apply because there is no female parent in the household. Therefore, the CCB is issued to the parent who applied.
The objective of this amendment is to allow a female parent to waive the CCB in right of a gender-neutral parent.
This amendment modifies paragraph 6301(1)(a) of the Regulations to allow a female parent to waive the female presumption in right of an “other” parent (being male or gender-neutral), as opposed to only a male parent.
The Regulations will come into force on July 1, 2021.
Consultations were not conducted for this regulatory amendment, since the amendment is administrative in nature, is expected to only have positive impacts and aligns with the Government of Canada's commitment to gender equality.
Modern treaty obligations and Indigenous engagement and consultation
An assessment of modern treaty implications was conducted for the Regulations, and no modern treaty implications were identified.
An amendment to the Regulations is the only option available. The circumstances by which the female presumption can be waived must be prescribed in section 6301 of the Regulations.
Benefits and costs
This regulatory amendment ensures all family structures in Canada can determine who the eligible individual is for purposes of the CCB. This amendment updates the Regulations to reflect the Government of Canada's introduction of an additional gender-neutral designation for gender in federal programs and services.
The implementation of this regulatory amendment will require minor updates to information technology systems and communications products. The required changes are expected to impose minimal costs to the Canada Revenue Agency (CRA).
Small business lens
The small business lens does not apply, as there are no associated impacts on businesses.
The one-for-one rule does not apply, as the amendments do not impact businesses.
Regulatory cooperation and alignment
This regulatory amendment is not related to a work plan or commitment under a formal regulatory cooperation forum.
Strategic environmental assessment
In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.
Gender-based analysis plus (GBA+)
This regulatory amendment expands the scope of paragraph 6301(1)(a) of the Regulations to include gender-neutral parents as “eligible individuals” for the purposes of the CCB.
All taxpayers impacted by this change are anticipated to be positively impacted. Households with a female parent and gender-neutral parent with low- to medium-income levels may realize a highly positive impact, as households in this income range receive the highest percentage of CCB payments. No negative impacts on different groups of people are anticipated.
Implementation, compliance and enforcement, and service standards
Canadians can learn about the CCB on the CRA webpage. Currently, eligible individuals can apply for the CCB (1) through birth registration; (2) online through CRA's My Account; or (3) in writing by completing form RC66, Canada Child Benefit Application.
By July 2021, the CRA will update its web content, online application and form RC66, Canada Child Benefit Application, to include gender-neutral eligibility.
The CRA's current service standard for processing digital benefit applications is within 8 weeks of receiving the application and within 11 weeks for paper benefit applications. A female parent who is a recipient of the CCB can only designate another parent as the eligible individual for purposes of the CCB by submitting a signed written declaration to the Minister of National Revenue. Applicants may submit signed declarations by mail or by submitting a scanned copy of their written and signed declaration via the Submit Docs feature on CRA's MyAccount. The CRA will seek to designate the other parent as the eligible individual for purposes of the CCB within 11 weeks of receiving the declaration. The CRA aims to meet this standard 95% of the time.
Eligibility and compliance for the CCB will continue to be monitored through existing CRA programs.
Benefit Programs Processing Division
Canada Revenue Agency