Chain Reaction Bicycles Ltd needs to calculate their Part IV Tax, Refundable Dividend Tax on Hand (RDTOH), and Dividend Refund for its December 31, 2015 year-end. Use the following information to complete Schedule 3 and Page 6 of the T2 Return: Foreign non-business income $ 40,000 Canadian property income 25,000 Canadian connected corporation dividends (Note 1) 25,000 Canadian non-connected corporation dividends (Note 2) 35,000 Canadian active business income 400,000 Net taxable capital gains 18,000 Net capital loss utilized in 2015 5,000 RDTOH balance at the end of 2014 12,000 Dividend refund for the previous tax year 6,000 Small business deduction calculation (Note 3) 400,000 Actual foreign non-business tax credit (line 632) 8,000 Dividends Chain Reaction paid to individual shareholders 40,000 Part I tax (line 700) 84,495 Taxable income 573,000 Note 1: We have 75% of the common shares of the connected corporation. The dollar amount listed above is the actual dividends we received during the year. Connected Corporation received a dividend refund of $5,000 Note 2: We have 7% of the common shares of the non-connected corporation. The dollar amount listed above is the actual dividends we received during the year. Non Connected Corporation received a dividend refund of $11,000. Note 3: This is the lesser of Line 400, 405, 410, or 425 on page 4 of the T2 

REQUIRED: Complete Schedule 3 and Page 6 of the T2 to calculate the Dividend Refund for Chain Reaction Bicycles Ltd. for 2015

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Schedule 3 Part IV Tax Calculation Part IV tax payable on Canadi... View the full answer