In connection with the possibility that the a lump sum payment received by a recent Canadian resident out of a Malaysian pension plan (namely, the Employees Provident Fund of Malaysia, which is administered by the Ministry of Finance Malaysia) might be Treaty exempt, CRA stated that in such event:
the individual who receives it still has to include the amount in income under clause 56(1)(a)(i)…but that individual can claim an offsetting deduction under subparagraph 110(1)(f)(i)… in computing the individual’s taxable income.