Ms. Maude Lavoie (Director General, Business Income Tax Division, Tax Policy Branch, Department of Finance) at the Finance Committee

Under the proposed rule, the eligibility for the small business deduction will start to be reduced once a CCPC earns $50,000 of passive investment income, and it will be gradually reduced until it reaches $150,000 of passive income, at which point the eligibility for the small business deduction will be nil.