The maximum LCGE for individuals who realize capital gains on the disposition of QFFP and qualified small business corporation shares is $813,600 for the 2015 tax year. Since only half of the capital gain on the disposition of property is taxable, the resulting capital gains deduction limit is $406,800. The deduction limit is indexed annually to inflation using the Consumer Price Index data as reported by Statistics Canada.

For QFFP disposed of after April 20, 2015, Budget 2015 introduces an additional lifetime exemption amount to effectively increase the LCGE for QFFP to $1 million. The LCGE for QFFP will stay at $1 million until the indexed amount of the base LCGE ($813,600 in 2015) exceeds $1 million. At that time, the same LCGE limit, indexed to inflation, will apply to the three types of property.

The additional exemption is calculated as the difference between $1 million and the indexed amount of the base LCGE ($813,600 in 2015). For properties disposed of after April 20, 2015, and before 2016, the additional lifetime exemption for QFFP is $186,400 and the additional lifetime deduction is $93,200.

No, the additional lifetime deduction can be used only for QFFP. Qualified small business shares only qualify for the additional deduction to the extent that they also qualify as shares of the capital stock of a farm or fishing corporation.

No, the additional lifetime deduction for QFFP can be used only after the existing LCGE limit that applies to both QFFP and the qualified small business corporation shares ($406,800 for 2015) is exhausted.

Budget 2015 also introduces amendments to the trust rules to require a trust to determine and designate the amount that is considered to be a beneficiary’s taxable capital gain from a disposition after April 20, 2015, of the beneficiary’s QFFP. In the calculation of the beneficiary’s capital gains deduction associated with the designated taxable capital gain, the beneficiary will be able to use any of their remaining additional lifetime capital gains exemption.

The Canada Revenue Agency (CRA) is committed to providing taxpayers with up-to-date information. The CRA encourages taxpayers to check its webpages often. All new forms, policies, and guidelines will be posted as they become available.

In the meantime, please consult the Department of Finance Canada's Budget 2015 documents for details.