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7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 30 37 38 39 40 41 42 43 44 45 40 47 48 49 50 51 52 53 54 55 1 In the last 10 years, Victoria has worked for Alberta co. publicly traded corp. and her 20X8 Net Income for Tax Purposes amounts of this include employment income 83,333 after deduct RPP, interest income Also, at the end of 20X8, her unused deduction room was and her Pension Adjustment for 20X8 was from reddeer branch and the remaining from Edmonton branch 2 In 20X9 she receives Were you being a tax professional work for A & B tax consultant corp. Victoria, new client ask you to help her to understand and prepare her tax return for 20X9 She wants to know her max RRSP deduction, and she wants to use it all to reduce her taxes. Also, she want you to calculate and explain what is her minimum Net income for Tax Purpose, her minimum Taxable Income, and her minimum Federal tax Payables. Finally, she needs to know her tax credits and how much her tax refund or owe from (to) Canada Revenue Agency. She provides you with the following information: Please DO NOT add or change numbers, DO NOT change formatting or delete any line below this Red Ribbon 3 250,000 gross salary of that Her employer deduct and withheld the following: 9 Federal Income Tax Canada Pension Plan contributions Employment Insurance Premiums Registered Pension Plan Contributions. Donation to United Way charity Professional Dues 5 On April 1, 20X9 Victoria receives options from her employer to bi Victoria exercises her option on Sept 15, 20X9 when the share price commission for CIBC Investor Edge, to handle this transaction. Ready Contribution to Disability Pension Plan Use of business (employer) vehicle Group 1,200 Victoria employer match contribution of 12,500 RPP and 900 to her disability plan The plan was started 10 years ago, and the annual premiums never changed ($1,800 a year), (at Dec 31, 20X8, her accumulated premiums in the plan w During 20X9, she receives 16,667 from her disability plan, while she is in hospital 4 Her employer provides her with a car purchased last year for 125,000 including taxes, the car was available to her for the entire year except for the month of march, she was in hospital for 31 days in Mar 20X9 (during that time employer have the keys for the car). During 20X9 the car was driven total of 62,000 of that 51,000 km for employment In 20X9 she receives 8,333 25,000 240,000 Case 37,500 10,000 Accessibility: Investigate 2,750 12,500 2,000 2,500 900 190,000 in Reddeer 6 Years ago, Victoria plans to move to Edmonton to be close to schools for her children, in 20X1 she won 600,000 from a lottery ticket immediately (in 20X1) she purchases two houses, first home for 290,000 in downtown Edmonton; and the second one for where she used to live. In 20X9 her daughter stayed in Edmonton house while she is attending University. In 20X3 her accountant advise her to designate the house in Edmonton as the principal residence, as he believes the houses will appreciate in the coming years in Edmonton. In April 20X9 she sold the second house in Red deer for 220,000 and she moves to Edmonton, she fill out form T2091 based on her accountant's advice and designated the Edmonton house as the principal residence from 20X3 and after. 7 In April 20X9, Victoria moves to Edmonton, here employer help her to be transferred to Edmonton branch, which located only 2km from here Edmonton home. She drov 155 km in here Van, with here 3 children and husband, and she pays the moving company 6,500 to move here household to Edmonton. The moving company delays the delivery due to drivers' strike, she and her family stayed in Holiday Inn hotel and pays 8 In Oct 1, 20X8, she opens a term deposit account, and she deposite 225,000 earning interest c 17,000 non eligible dividend from taxable Canadian corp. Sheet1 59,480 7,143 non-eligible dividends 18,182 1,000 Alberta co. shares at 25 on that date the company stock price was traded at 40 On October 10, 20X9 she sold those shares for 50 each and she pays 1,000 3 night 300 per night not including meals (she provides you with the receipts). Alberta co. policy not to reimburse any moving expenses for any employee. 8% and she will receive the interest at maturity on Sep 30, 20X12. 7,692 Summry and Tax Payable 700 Employment, Property & other = IBI Capital Gains 30 4 days RRSP + + 80% 54 55 56 10 57 58 59 OCH STORNNNKRRRR 60 61 67 68 69 62 12 April 1, 20X9 Victoria sold 71 72 9 74 11 75 In 20X9 she receives 77 She owns rental property, capital cost (the property in class 1 17,000 non eligible dividend from taxable Canadian corp. On June 20X9 she sold a vacant land for She paid selling and legal expenses amount 63 64 65 66 13 Victoria currently married to Tom and they have 3 children (Sun 3 years old, Moon 9 years old and Star 19 years old, all of the children are in good health While you discussing this tax return, Victoria told you that Tom is her second marriage and his employment income 1,500 a month includ 300 for child support, she provides you with documentation confirmed her payments of 92 93 94 95 96 97 98 99 100 101 102 103 104 105 2,000,000 UCC on Jan 1, 20X9 was 1,600,000 she receives CCA rate and she will claim the max CCA) max CCA if possible 4% 70 14 Victoria and Tom employed and paid daycar 20,480 for child care expenses also during summer they send Sun and Moon to a summer camp for 4 1,250,000 she received 7,000 The original of the shares; she had inherited and the fair market value at the time of his death was 76 16 During 20X9 the family total medical expenses paid by the Tom was 2,000 shares of River Ltd. for 20 per share and she pays 1,500 of the shares from her late father in 20X5. Her father had paid 11 per share. Also, In 20X6 Victoria purchased an additional 2,000 73 15 After Christmas party, police stopped Tom and fine him with a Tom did not have money to pay and this fine paid by Victoria, she want to deduct it if possible Ready 125,000 Non capital losses from 20X5 Net capital losses from 20X0 Required: Please assist Victoria in her request; by calculating: down payment and the remaining balance will be paid in 5 annual instalments. The cost for the land was 4 79 80 81 18 You learned that Victoria has balances carried over from prior years, she plans to deduct them if possible 82 Charitable donation from 20X1 83 3,200 3,800 6,138 84 85 86 19 Other payments / disbursements made by Victoria during 20X9: 87 - Swimming lessons for victoria and her children cost $1,9 1,900 1,800 88 - Rent while her home under renovation cost $1,800 89 -- Advanced Accounting class to improve here IFRS knowledge (work related not required by her employer) 90 91 20X9 Federal Tax Payable (before credits) Federal non-refundable Tax credits 34,000 in rental revenues and incurred expenses (other than CCA) 29,000 78 17 Star is full time student in the University of Alberta; she attends 8 month during 20X9 full time and her tuition fees of 8,200 she has no income and all her expenses paid by her parents. Victoria provides you with form signed by Star agreeing to transfer any tuition credits at maximum to her Mom. Accessibility: Investigate 12,480 baby sitter to care of Sun and moon after school while she and Tom at work. weeks which cost 4,000 per child ($1,000 a week) 12,345 None of that for Star RRSP Maximum deductible for 20X9 (as she will contribute this amount to her RRSP) 20X9 Division B income (Net Income for Tax Purposes) -(Must show income by Sub division (3a, 3b...)) 20X9 Taxable Income 1,000 commission for CIBC Investor Edge, to handle this transaction 7 per share when he purchased the shares in 20X2, 1,500 shares for 14 per share, and paid ticket because he was driving under the influence of alcohol. Also, the provincial court sent him to jail fo 24,000 Also, she told you based on court order she have to pay her previous spouse (spousal and child suppor 12,000 during 20X9 and she plan to pay the remaining amount in Jan 20X10. 840 20X9 Net Federal Tax payable Write a memo to Victoria explaining to her how you prepared her tax return. By explaining to her why some items can't be deducted, and why there is addition to income of amounts she never received (Benefits). (one to two pages maximum) ###### Notes: 1- Answers only NOT acceptable, support calculations is required. Your solution MUST be on Excel and use formulas as possible. Memo on Word Doc. Hand writing will NOT be accepted 2- Use the current vear rates for the 20X9. credits...etc. It can be found on your ITA. Meskanas or search CRA website Group Case Sheet1 Summry and Tax Payable Employment, Property & other Capital Gains IBI 200 6 weeks commission RRSP + + 78% 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 18 You learned that Victoria has balances carried over from prior years, she plans to deduct them if possible Charitable donation from 20X1 3,200 3,800 6,138 Non capital losses from 20X5 Net capital losses from 20X0 19 Other payments / disbursements made by Victoria during 20X9: - Swimming lessons for victoria and her children cost $1,9 1,900 1,800 - Rent while her home under renovation cost $1,800 - Advanced Accounting class to improve here IFRS knowledge (work related not required by her employer) Required: Please assist Victoria in her request; by calculating: RRSP Maximum deductible for 20X9 (as she will contribute this amount to her RRSP) 20X9 Division B income (Net Income for Tax Purposes) -(Must show income by Sub division (3a, 3b...)) 20x9 Taxable Income 20x9 Federal Tax Payable (before credits) Federal non-refundable Tax credits 20X9 Net Federal Tax payable Write a memo to Victoria explaining to her how you prepared her tax return. By explaining to her why some items can't be deducted, and why there is addition to income of amounts she never received (Benefits). (one to two pages maximum) Notes: 1- Answers only NOT acceptable, support calculations is required. Your solution MUST be on Excel and use formulas as possible. Memo on Word Doc. Hand writing will NOT be accepted 2- Use the current year rates for the 20X9, credits...etc. It can be found on your ITA, Meskanas or search CRA website 3- Reference your answers to income tax act sections, subsection, paragraph.... etc. 10% of the marks will be allocated to references from ITA. 3- You can use the provided templates or create your own (to help me mark it faster, I prefer you using my templates). Group Case Ready Accessibility: Investigate 840 Sheet1 Summry and Tax Payable Employment, Property & other IBI Capital Gains RRSP + + 78% 2 3 4 5 6 7 8 9 10 11 18 19 20 21 ITA 22 23 24 25 26 27 28 3 Net Income for tax purposes (Section 3) 118.1 121(a) 3(a) Ready Employment income Property Income Business Income 12 13 14 111 & 110 Non capital loss 15 Net capital loss 16 110(1)(d) & (d.1) deduction 17 Taxable Income Other income 3(b) Taxable Capital Gain 3(c) other deductions 3(d) Current year losses Net Income For Tax Purposes Division C deductions: 2019 Federal Tax payable 29 118(1) (a) Basic personal amount 30 118(1)(a) Spouse or common-Law partner 31 118.7 Canada Pension Plan contribution 32 118.7 Employment Insurance premiums 118(10) Canada Employment amount 33 34 118.5 Tuition, Education transferred from child 35 118.2 Medical expense Actual expense 36 37 Less lessor of 38 3% of net income 39 total credit base 40 rate 41 42 43 44 45 Federal non-refundable Tax credits ITA 118 15% on First (53,359) 20.5% on next (106,717-53,359) 26% on next (165,430-106717) 29% on next (235,675-165,430) 33% on over 235,675 Federal Tax Payable before credit Charitable donation Dividend tax credit (non-eligible) Federal non-refundable Tax credits Federal Income Tax deducted Net Federal Tax Payable (Balance Owing) Group Case Sheet1 Accessibility: Investigate $ 250,000 $ $ 250,000 250,000 15% 8,004 10,938 18,942 (37,500) $ (18,558) Summry and Tax Payable 1 1 1 0.5 $ 1 $ 0.5 $ 0.5 $ 0.5 $ 1 $ $ $ $ 2 $ $ A 1.5 1.5 1 Employment, Property & other Capital Gains RRSP + + 90% 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 30 37 38 39 40 41 42 43 44 45 40 47 48 49 50 51 52 53 54 55 1 In the last 10 years, Victoria has worked for Alberta co. publicly traded corp. and her 20X8 Net Income for Tax Purposes amounts of this include employment income 83,333 after deduct RPP, interest income Also, at the end of 20X8, her unused deduction room was and her Pension Adjustment for 20X8 was from reddeer branch and the remaining from Edmonton branch 2 In 20X9 she receives Were you being a tax professional work for A & B tax consultant corp. Victoria, new client ask you to help her to understand and prepare her tax return for 20X9 She wants to know her max RRSP deduction, and she wants to use it all to reduce her taxes. Also, she want you to calculate and explain what is her minimum Net income for Tax Purpose, her minimum Taxable Income, and her minimum Federal tax Payables. Finally, she needs to know her tax credits and how much her tax refund or owe from (to) Canada Revenue Agency. She provides you with the following information: Please DO NOT add or change numbers, DO NOT change formatting or delete any line below this Red Ribbon 3 250,000 gross salary of that Her employer deduct and withheld the following: 9 Federal Income Tax Canada Pension Plan contributions Employment Insurance Premiums Registered Pension Plan Contributions. Donation to United Way charity Professional Dues 5 On April 1, 20X9 Victoria receives options from her employer to bi Victoria exercises her option on Sept 15, 20X9 when the share price commission for CIBC Investor Edge, to handle this transaction. Ready Contribution to Disability Pension Plan Use of business (employer) vehicle Group 1,200 Victoria employer match contribution of 12,500 RPP and 900 to her disability plan The plan was started 10 years ago, and the annual premiums never changed ($1,800 a year), (at Dec 31, 20X8, her accumulated premiums in the plan w During 20X9, she receives 16,667 from her disability plan, while she is in hospital 4 Her employer provides her with a car purchased last year for 125,000 including taxes, the car was available to her for the entire year except for the month of march, she was in hospital for 31 days in Mar 20X9 (during that time employer have the keys for the car). During 20X9 the car was driven total of 62,000 of that 51,000 km for employment In 20X9 she receives 8,333 25,000 240,000 Case 37,500 10,000 Accessibility: Investigate 2,750 12,500 2,000 2,500 900 190,000 in Reddeer 6 Years ago, Victoria plans to move to Edmonton to be close to schools for her children, in 20X1 she won 600,000 from a lottery ticket immediately (in 20X1) she purchases two houses, first home for 290,000 in downtown Edmonton; and the second one for where she used to live. In 20X9 her daughter stayed in Edmonton house while she is attending University. In 20X3 her accountant advise her to designate the house in Edmonton as the principal residence, as he believes the houses will appreciate in the coming years in Edmonton. In April 20X9 she sold the second house in Red deer for 220,000 and she moves to Edmonton, she fill out form T2091 based on her accountant's advice and designated the Edmonton house as the principal residence from 20X3 and after. 7 In April 20X9, Victoria moves to Edmonton, here employer help her to be transferred to Edmonton branch, which located only 2km from here Edmonton home. She drov 155 km in here Van, with here 3 children and husband, and she pays the moving company 6,500 to move here household to Edmonton. The moving company delays the delivery due to drivers' strike, she and her family stayed in Holiday Inn hotel and pays 8 In Oct 1, 20X8, she opens a term deposit account, and she deposite 225,000 earning interest c 17,000 non eligible dividend from taxable Canadian corp. Sheet1 59,480 7,143 non-eligible dividends 18,182 1,000 Alberta co. shares at 25 on that date the company stock price was traded at 40 On October 10, 20X9 she sold those shares for 50 each and she pays 1,000 3 night 300 per night not including meals (she provides you with the receipts). Alberta co. policy not to reimburse any moving expenses for any employee. 8% and she will receive the interest at maturity on Sep 30, 20X12. 7,692 Summry and Tax Payable 700 Employment, Property & other = IBI Capital Gains 30 4 days RRSP + + 80% 54 55 56 10 57 58 59 OCH STORNNNKRRRR 60 61 67 68 69 62 12 April 1, 20X9 Victoria sold 71 72 9 74 11 75 In 20X9 she receives 77 She owns rental property, capital cost (the property in class 1 17,000 non eligible dividend from taxable Canadian corp. On June 20X9 she sold a vacant land for She paid selling and legal expenses amount 63 64 65 66 13 Victoria currently married to Tom and they have 3 children (Sun 3 years old, Moon 9 years old and Star 19 years old, all of the children are in good health While you discussing this tax return, Victoria told you that Tom is her second marriage and his employment income 1,500 a month includ 300 for child support, she provides you with documentation confirmed her payments of 92 93 94 95 96 97 98 99 100 101 102 103 104 105 2,000,000 UCC on Jan 1, 20X9 was 1,600,000 she receives CCA rate and she will claim the max CCA) max CCA if possible 4% 70 14 Victoria and Tom employed and paid daycar 20,480 for child care expenses also during summer they send Sun and Moon to a summer camp for 4 1,250,000 she received 7,000 The original of the shares; she had inherited and the fair market value at the time of his death was 76 16 During 20X9 the family total medical expenses paid by the Tom was 2,000 shares of River Ltd. for 20 per share and she pays 1,500 of the shares from her late father in 20X5. Her father had paid 11 per share. Also, In 20X6 Victoria purchased an additional 2,000 73 15 After Christmas party, police stopped Tom and fine him with a Tom did not have money to pay and this fine paid by Victoria, she want to deduct it if possible Ready 125,000 Non capital losses from 20X5 Net capital losses from 20X0 Required: Please assist Victoria in her request; by calculating: down payment and the remaining balance will be paid in 5 annual instalments. The cost for the land was 4 79 80 81 18 You learned that Victoria has balances carried over from prior years, she plans to deduct them if possible 82 Charitable donation from 20X1 83 3,200 3,800 6,138 84 85 86 19 Other payments / disbursements made by Victoria during 20X9: 87 - Swimming lessons for victoria and her children cost $1,9 1,900 1,800 88 - Rent while her home under renovation cost $1,800 89 -- Advanced Accounting class to improve here IFRS knowledge (work related not required by her employer) 90 91 20X9 Federal Tax Payable (before credits) Federal non-refundable Tax credits 34,000 in rental revenues and incurred expenses (other than CCA) 29,000 78 17 Star is full time student in the University of Alberta; she attends 8 month during 20X9 full time and her tuition fees of 8,200 she has no income and all her expenses paid by her parents. Victoria provides you with form signed by Star agreeing to transfer any tuition credits at maximum to her Mom. Accessibility: Investigate 12,480 baby sitter to care of Sun and moon after school while she and Tom at work. weeks which cost 4,000 per child ($1,000 a week) 12,345 None of that for Star RRSP Maximum deductible for 20X9 (as she will contribute this amount to her RRSP) 20X9 Division B income (Net Income for Tax Purposes) -(Must show income by Sub division (3a, 3b...)) 20X9 Taxable Income 1,000 commission for CIBC Investor Edge, to handle this transaction 7 per share when he purchased the shares in 20X2, 1,500 shares for 14 per share, and paid ticket because he was driving under the influence of alcohol. Also, the provincial court sent him to jail fo 24,000 Also, she told you based on court order she have to pay her previous spouse (spousal and child suppor 12,000 during 20X9 and she plan to pay the remaining amount in Jan 20X10. 840 20X9 Net Federal Tax payable Write a memo to Victoria explaining to her how you prepared her tax return. By explaining to her why some items can't be deducted, and why there is addition to income of amounts she never received (Benefits). (one to two pages maximum) ###### Notes: 1- Answers only NOT acceptable, support calculations is required. Your solution MUST be on Excel and use formulas as possible. Memo on Word Doc. Hand writing will NOT be accepted 2- Use the current vear rates for the 20X9. credits...etc. It can be found on your ITA. Meskanas or search CRA website Group Case Sheet1 Summry and Tax Payable Employment, Property & other Capital Gains IBI 200 6 weeks commission RRSP + + 78% 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 18 You learned that Victoria has balances carried over from prior years, she plans to deduct them if possible Charitable donation from 20X1 3,200 3,800 6,138 Non capital losses from 20X5 Net capital losses from 20X0 19 Other payments / disbursements made by Victoria during 20X9: - Swimming lessons for victoria and her children cost $1,9 1,900 1,800 - Rent while her home under renovation cost $1,800 - Advanced Accounting class to improve here IFRS knowledge (work related not required by her employer) Required: Please assist Victoria in her request; by calculating: RRSP Maximum deductible for 20X9 (as she will contribute this amount to her RRSP) 20X9 Division B income (Net Income for Tax Purposes) -(Must show income by Sub division (3a, 3b...)) 20x9 Taxable Income 20x9 Federal Tax Payable (before credits) Federal non-refundable Tax credits 20X9 Net Federal Tax payable Write a memo to Victoria explaining to her how you prepared her tax return. By explaining to her why some items can't be deducted, and why there is addition to income of amounts she never received (Benefits). (one to two pages maximum) Notes: 1- Answers only NOT acceptable, support calculations is required. Your solution MUST be on Excel and use formulas as possible. Memo on Word Doc. Hand writing will NOT be accepted 2- Use the current year rates for the 20X9, credits...etc. It can be found on your ITA, Meskanas or search CRA website 3- Reference your answers to income tax act sections, subsection, paragraph.... etc. 10% of the marks will be allocated to references from ITA. 3- You can use the provided templates or create your own (to help me mark it faster, I prefer you using my templates). Group Case Ready Accessibility: Investigate 840 Sheet1 Summry and Tax Payable Employment, Property & other IBI Capital Gains RRSP + + 78% 2 3 4 5 6 7 8 9 10 11 18 19 20 21 ITA 22 23 24 25 26 27 28 3 Net Income for tax purposes (Section 3) 118.1 121(a) 3(a) Ready Employment income Property Income Business Income 12 13 14 111 & 110 Non capital loss 15 Net capital loss 16 110(1)(d) & (d.1) deduction 17 Taxable Income Other income 3(b) Taxable Capital Gain 3(c) other deductions 3(d) Current year losses Net Income For Tax Purposes Division C deductions: 2019 Federal Tax payable 29 118(1) (a) Basic personal amount 30 118(1)(a) Spouse or common-Law partner 31 118.7 Canada Pension Plan contribution 32 118.7 Employment Insurance premiums 118(10) Canada Employment amount 33 34 118.5 Tuition, Education transferred from child 35 118.2 Medical expense Actual expense 36 37 Less lessor of 38 3% of net income 39 total credit base 40 rate 41 42 43 44 45 Federal non-refundable Tax credits ITA 118 15% on First (53,359) 20.5% on next (106,717-53,359) 26% on next (165,430-106717) 29% on next (235,675-165,430) 33% on over 235,675 Federal Tax Payable before credit Charitable donation Dividend tax credit (non-eligible) Federal non-refundable Tax credits Federal Income Tax deducted Net Federal Tax Payable (Balance Owing) Group Case Sheet1 Accessibility: Investigate $ 250,000 $ $ 250,000 250,000 15% 8,004 10,938 18,942 (37,500) $ (18,558) Summry and Tax Payable 1 1 1 0.5 $ 1 $ 0.5 $ 0.5 $ 0.5 $ 1 $ $ $ $ 2 $ $ A 1.5 1.5 1 Employment, Property & other Capital Gains RRSP + + 90%