EX Ltd. is a Canadian-controlled private corporation operating a retail business in Canada. For the current year

Question:

EX Ltd. is a Canadian-controlled private operating a retail business in Canada. For the current year EX Ltd. has net income of $662,000 and taxable income of $600,000. Included in net income are taxable capital gains of $46,000 and interest from Canadian sources of $30,000 as well as $42,000 of dividends from Canadian public companies. Net capital losses of $20,000 were deducted in computing taxable income. EX Ltd. is claiming a small-business deduction of $85,000 ($500,000 x 17%), which reduces the Part I tax payable to $204,433. The RDTOH balance at the end of the previous year was $12,000. During the current year taxable dividends of $27,000 were paid. Dividends were not paid in the previous year.
Determine the refund for EX Ltd. for the current year. Income tax reference: ITA 129(1), (3), (4), 186(1).
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