Erin is an employee of TD-ROM, Inc., a public company. In 2012, her compensation package was as follows:
Gross salary............................................................................$59,000
Less Payroll deductions
Employee contribution to a registered pension plan............................. (3,000)
Charitable donations - United Way................................................... (55)
Canadian Pension Plan contributions............................................. (2,307)
Employment Insurance contributions............................................... (840)
Net pay received..................................................................... $52,798
Non-cash perks
Employer contribution to a registered plan.................................................. $ 3,500
Private dental plan valued at..................................................................... $ 800
Mandatory employer-paid provincial health tax............................................... $ 450
Reimbursement of moving expenses for relocating from Edmonton....................... $ 900
Club membership (for company promotion) ................................................ $ 1,800
Supplier's prize for outstanding employee sales - Hawaii golf trip valued at/........... $ 6,000
Bonus declared but not paid.................................................................... $ 2,000
Hard hat and safety glasses........................................................................ $ 450
The company states that club memberships should be used for business promotion.
TD-ROM also offered Erin a stock option to purchase 1,000 corporate shares at $12 a share. On June 4, 2012, she exercised the option. As of December 31, 2012, Erin had not disposed of the shares.
February 1, 2005, Fair market value - Grant date $11 June 4, 2012, Fair market value - Exercise date $19 December 31, 2012, Fair market value $16
REQUIRED
Compute Erin's income from employment for income tax purposes.