AP 7-8 (Comprehensive Case Covering Chapters 1 to 7) Carl Nemah is 66 years old, and while he receives significant pension income from a former employer's registered pension plan (RPP), he is a full-time employee of Jardu Enterprises Ltd. (JEL). In 2023, his gross wages were $70,000. JEL withheld the following amounts from these wages: In 2023 , he received pension income of $42,000. He has not applied for OAS as he knows that all of it will be clawed back. Further, he has not applied for CPP as he is aware that deferring this application will result in larger benefits in the future. He has not elected to discontinue CPP contributions. Carl has been married to Susan Nemah for over 40 years. Susan is 68 years old and has net income of $9,900. This consists of OAS of $8,250 and pension income from her RRSP. She has not applied for CPP. Carl has two children. His 32-year-old son, Jerome, has a disability that qualifies him for the disability tax credit. He lives with Carl and Susan and has no income of his own. Carl volunteers his services with a non-profit organization that provides support services to individuals with disabilities. Carl's daughter, Suzanne, is 41 years old and is recently divorced. She and her children also live with Carl. Her only income is $36,000 in child support that she receives under a 2022 court approved divorce settlement. In 2023, she decided to become an accountant and, to this end, she began attending university on a full-time basis in September 2023. Carl has paid her tuition of $4,600 for 2023 and Suzanne has agreed to transfer the maximum tuition credit to her father. The family's medical expenses, all of which have been paid by Carl, are as follows: In 2023, Carl received the following dividends (all amounts in Canadian dollars): Foreign income tax of 15% of $12,500, or $1,875, was withheld by the foreign country with respect to the foreign dividends. The shares that Carl owns in his sister's CCPC are excluded shares, meaning that the income splitting rules of the TOSI do not apply to the non-eligible dividends he has received. In addition to dividends, Carl had interest income of $2,843 in 2023 . The interest income is the amount required to be included in income as a result of ITA 12(1)(c) and 12(4). Because of the project management skills that he has acquired over the years, Carl started a management consulting business in 2020 that he carries on as a sole proprietor. The business has a December 31 fiscal period and begins January 1, 2020. In January 2020 he purchased a new building to be used as an office for his business. The building cost $426,000 of which $126,000 was the estimated value of the land and the remaining $300,000 allocated to the building. On January 1, 2023 , the UCC of the building is $273,540. A timely election was filed to include the building in a separate class. The building contains office furniture and fixtures that were also purchased in January 2020, at a cost of $42,000. On January 1,2023 , the UCC of the class is $30,240. In 2023 , he spends $41,000 on improving and upgrading the building. In addition, he sells the old furniture and fixtures for $18,600 and purchases replacement furniture and fixtures for $50,000. As Carl has no reason to keep detailed accounting records, he records business income on a cash basis. In 2023, his net cash flow from the business was $123,500. Relevant amounts for 2023 are as follows: Since the business began, Carl has owned an automobile that was used 100% for business purposes. This automobile was sold in December 2022. He purchased a new zero-emission automobile in January 2023, at a cost of $71,500. He financed the automobile through his bank and, in 2023 , he made payments of $13,200 on the loan, which he deducted in full in determining his business income. Of the total, $4,920 represented payments for interest with $8,280 paid against the principal. Carl paid automobile operating expenses totalling \$9,260 in 2023. Required: Calculate Carl's minimum 2023 net income, taxable income, and federal income tax payable. Ignore immediate expensing, any GST/HST \& PST considerations, and the possibility of pension income splitting. AP 7-8 (Comprehensive Case Covering Chapters 1 to 7) Carl Nemah is 66 years old, and while he receives significant pension income from a former employer's registered pension plan (RPP), he is a full-time employee of Jardu Enterprises Ltd. (JEL). In 2023, his gross wages were $70,000. JEL withheld the following amounts from these wages: In 2023 , he received pension income of $42,000. He has not applied for OAS as he knows that all of it will be clawed back. Further, he has not applied for CPP as he is aware that deferring this application will result in larger benefits in the future. He has not elected to discontinue CPP contributions. Carl has been married to Susan Nemah for over 40 years. Susan is 68 years old and has net income of $9,900. This consists of OAS of $8,250 and pension income from her RRSP. She has not applied for CPP. Carl has two children. His 32-year-old son, Jerome, has a disability that qualifies him for the disability tax credit. He lives with Carl and Susan and has no income of his own. Carl volunteers his services with a non-profit organization that provides support services to individuals with disabilities. Carl's daughter, Suzanne, is 41 years old and is recently divorced. She and her children also live with Carl. Her only income is $36,000 in child support that she receives under a 2022 court approved divorce settlement. In 2023, she decided to become an accountant and, to this end, she began attending university on a full-time basis in September 2023. Carl has paid her tuition of $4,600 for 2023 and Suzanne has agreed to transfer the maximum tuition credit to her father. The family's medical expenses, all of which have been paid by Carl, are as follows: In 2023, Carl received the following dividends (all amounts in Canadian dollars): Foreign income tax of 15% of $12,500, or $1,875, was withheld by the foreign country with respect to the foreign dividends. The shares that Carl owns in his sister's CCPC are excluded shares, meaning that the income splitting rules of the TOSI do not apply to the non-eligible dividends he has received. In addition to dividends, Carl had interest income of $2,843 in 2023 . The interest income is the amount required to be included in income as a result of ITA 12(1)(c) and 12(4). Because of the project management skills that he has acquired over the years, Carl started a management consulting business in 2020 that he carries on as a sole proprietor. The business has a December 31 fiscal period and begins January 1, 2020. In January 2020 he purchased a new building to be used as an office for his business. The building cost $426,000 of which $126,000 was the estimated value of the land and the remaining $300,000 allocated to the building. On January 1, 2023 , the UCC of the building is $273,540. A timely election was filed to include the building in a separate class. The building contains office furniture and fixtures that were also purchased in January 2020, at a cost of $42,000. On January 1,2023 , the UCC of the class is $30,240. In 2023 , he spends $41,000 on improving and upgrading the building. In addition, he sells the old furniture and fixtures for $18,600 and purchases replacement furniture and fixtures for $50,000. As Carl has no reason to keep detailed accounting records, he records business income on a cash basis. In 2023, his net cash flow from the business was $123,500. Relevant amounts for 2023 are as follows: Since the business began, Carl has owned an automobile that was used 100% for business purposes. This automobile was sold in December 2022. He purchased a new zero-emission automobile in January 2023, at a cost of $71,500. He financed the automobile through his bank and, in 2023 , he made payments of $13,200 on the loan, which he deducted in full in determining his business income. Of the total, $4,920 represented payments for interest with $8,280 paid against the principal. Carl paid automobile operating expenses totalling \$9,260 in 2023. Required: Calculate Carl's minimum 2023 net income, taxable income, and federal income tax payable. Ignore immediate expensing, any GST/HST \& PST considerations, and the possibility of pension income splitting