Section 1026 of ITA: meaning of “non-qualifying income” for the purposes of section 1025 of ITA (meaning of “modified net income”)
1419.Section 1026(g) of ITA refers to section 804 of ICTA. It is drafted on the basis that section 804(5B)(a) of ICTA deems a person to receive an amount. But, following its amendment by ITA, section 804(5B)(a) does not deem a person to receive an amount.
1420.Also, section 1026(g) of ITA is drafted on the basis that the income tax liability calculated under section 23 of ITA includes the income tax liability under section 804(5B)(a) of ICTA. But that is not the case. The liability under section 804(5B)(a) is mentioned in section 32 of ITA and is therefore (by virtue of section 22(2) of that Act) outside section 23 of that Act.
1421.Section 1026(g) is therefore otiose. It is repealed without replacement.