ACCT2028 Taxation CRN 82554 S2020 Communications Assignment Due Date: May 31, 2020 Mr. Rafael Solano is a U.S. citizen. However, since obtaining permanent residence status in 2003, he has been employed on a full-time basis in Waterloo, Ontario. His employer is a Canadian subsidiary of a multinational corporation that also operates in Europe and Africa. The head office of the company is in the United States. Mr. Solano has been very successful in his position with the Canadian subsidiary. Based on this, he has been offered a promotion which involves a significant increase in salary. However, this promotion is conditional on his moving to the companys head office in Boston no later than March 11, 2019. Given the sizable increase in his overall compensation, Mr. Solano accepts the offer. As a U.S. citizen, he has no difficulty getting the appropriate documentation to establish his residency in the U.S. He gives up his Canadian drivers license and his provincial health care card. As required by his employer, he is at his desk in the new work location in the U.S. on March 11. Mr. Solano and his spouse, Jane, have one child, Matteo, who is attending a private school in Waterloo. The current semester at this school will end on June 26, 2019. In order not to disrupt Matteos schooling, Jane decides that she and Matteo will remain in Canada until the semester ends. They depart Canada on June 29, 2019. The real estate market has been slow since the non-resident speculation tax was introduced by the Ontario government in 2017. As a result, the Solanos house did not sell until October 25, 2019. Required: Write a short (one page) memo explaining the tax policy regarding Canadian residency for tax purposes to Rafael Solano. Be sure to include the following: The rules regarding residency for Canadian income tax purposes (with references to appropriate sections of the Tax Act) The factors you considered to determine Rafaels residency status for 2019. The portion of Rafaels income in 2019, if any, that would be subject to Canadian income tax Your client will have limited understanding of income taxation, so you need to analyze the issue at a high level and then clearly and concisely explain your conclusions. Grade: This assignment is worth 10% of your final grade. The marks will be allocated as follows:

80% of the marks analysis of tax issue (using facts from the case and your knowledge of tax rules)

20% of the marks professional communication (including complete grammar and accurate spelling) at an appropriate level for the client