Vancouver Polytechnic University (“VPU”) starts operation in November of this year, with the first teaching term scheduled for January of the following year. In order to attract Dan Pro, a very popular tax instructor, to join its faculty, VPU offers Dan an attractive annual salary, a signing bonus of $10,000 and a prepayment of $20,000 from his next year’s salary all payable right now (November of this year). Would Dan be taxed on the signing bonus and the prepayment this year and if so how? 

Answer rating: 100% (QA)

Yes Dan will be taxed on the signing bonus and the prepayment this year because as p... View the full answer