To help Daniel make an informed decision lets analyze his employment income and disposable income for both his current job and the offer from the competitor a Current Employment Income for Tax Purposes Gross Salary 80000 Deductions EI Premiums 1049 CPP Contributions 4056 Employment Expenses 1 Car Lease 500month 12 6000 2 Insurance 800 3 Repairs and Maintenance 600 4 Gasoline 2200 5 Meals Deductible Portion for Work Trips 200 Car Expenses for Work Since 4000 km out of 22000 km is for work Proportion for Work 4 000 22 000 1818 Deductible Car Expenses Car Lease 1818 of 6000 1091 Insurance 1818 of 800 145 Repairs and Maintenance 1818 of 600 109 Gasoline 1818 of 2200 400 Total Deductible Car Expenses 1745 Tool and Coverall Expenses Tools 500 Coveralls 300 Total Deductible Work Expenses 1745 500 300 2545 Taxable Income Calculation 1 Gross Salary 80000 2 Less EI and CPP Deductions 1049 4056 5105 3 Less Deductible Employment Expenses 2545 Net Taxable Income 80000 5105 2545 72350 b Proposed Employment Income with Competitor Gross Salary 70000 Deductions EI Premiums 1049 CPP Contributions 4056 Benefits Car Lease 450month 12 5400 not personal cost Insurance 800 covered by employer Repairs and Maintenance 600 covered by employer Gasoline 2200 covered by employer Meals 200 covered by employer Tools and Coveralls 500 300 covered by employer Golf Club Membership 2400 covered by employer Life and Medical Insurance 1200 600 covered by employer Taxable Benefits Calculation Company car for personal use benefit is minor No direct taxable income from employerpaid benefits since they directly handle expenses Net Taxable Income Calculation 1 Gross Salary 70000 2 Less EI and CPP Deductions 1049 4056 5105 Net Taxable Income 70000 5105 64895 c Calculation of Disposable Income Current Job Net Income after Deductions 72350 Income Tax 40 rate 72350 40 28940 Disposable Income 72350 28940 43410 New Offer Net Income after Deductions 64895 Income Tax 40 rate 64895 40 25958 Disposable Income 64895 25958 38937 Change in Disposable Income Current 43410 New Offer 38937 Difference 38937 43410 4 473 Thus Daniels disposable income would decrease by 4473 if he accepts the new offer assuming a simple tax calculation