# Tim Markus, Vice President of Phone Lines, earned \$92,000 in salary last year. In addition to his salary, he also

## Question:

Tim Markus, Vice President of Phone Lines, earned \$92,000 in salary last year. In addition to his salary, he also received low-interest loans from his employer. Tim's interest rate on these loans is 3% and he owed \$160,000 throughout last year. Tim used the loan to purchase a rental property (see Schedule 1). Assume a prescribed interest rate of 8% for the entire year. Five years ago, Tim invested in some common shares of a foreign corporation. He receives \$18,000 in dividends (net of \$2,000 with-holding tax) annually from this corporation. Last year, he also received taxable eligible dividends of \$30,000 from his investment in a Canadian public company which is resident in Canada. Tim also owns \$100,000 worth of 10% bonds.
Schedule 1:
Rental revenue .............................. \$26,000
Maintenance expenses .....................5,500
Utilities on rental units .....................8,200
CCA - half-year rule .....................3,200
REQUIRED
Compute Tim's income for tax purposes for last year.

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Related Book For

## Introduction To Federal Income Taxation In Canada

ISBN: 9781554965021

33rd Edition

Authors: Robert E. Beam, Stanley N. Laiken, James J. Barnett

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