Anthony is the sole shareholder of Glass Co.He would like to lend $500,000 to his company by way of a shareholder loan. He is not sure whether to issue an interest free loan or a loan with an interest rate of 10%.Anthony does not pay himself a salary, but rather issues all after-tax profits to himself in the form of a dividend.

Required:

Calculate the total combined tax liability for Anthony and Glass Co.under both alternatives (an interest free loan and a loan with 10% interest).(Assume that CRA's prescribed rate of interest is 2%, Anthony's personal tax rate is 50% his marginal tax rate on dividends is 43%, and Glass Co.has income of $200,000,subject to a 13% tax rate.)

B)Has double taxation occurred in either scenario?