Assume the scenarios that follow with respect to the shareholder of a CCPC$.$

View the assumptions.

Required

Using these assumptions, indicate whether integration is working perfectly. If your answer is no$,$ briefly explain why this is the case. Also, discuss whether there is a possible deferral opportunity from incorporating even though integration may not be working properly.

The provincial dividend tax credit is below the rate required for perfect integration. The combined corp below the rate that is required to achieve perfect integration.

Work on calculating the income taxes on the income when flowed through the corporation. In this step, c

Business income for the year

Corporate taxes $(17\%)$

Income available for taxable dividends

Assumptions

The corporation's business income for the year is $$50,000.$

Any taxable dividends paid are non$-$eligible dividends.

The individual's marginal income federal tax rate is $33\%,$ and the marginal provincial income tax rate is $16\%.$

The provincial dividend tax credit is equal to $(413)$ of the gross up$.$

The combined federal and provincial corporate income tax rate is $17\%.$