Harry Winters has recently been appointed vice-president of sales and marketing for Barney's Books Limited, a public company. Harry has come to you for advice regarding the tax implications of his new position. During your meeting, you were able to determine the following information:

(A) Remuneration for the year:

Salarygross . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . $95,720

Less: Canada Pension Plan contributions . . . . . . . . . . . . . . $3,166

Employment Insurance contributions . . . . . . . . . .. . . 890

Disability insurance premiums . . . . . . . . . . . . . . . . . . . . . 600 4,686

$91,034

Bonus based on company sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,000

Allowances for the year is list below:

Meals, accommodation and air travel . . . . . . . . . . . . . . . . . . . . . . . . 16,000

Car . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,800

Harry has also been granted an option to acquire 6,500 previously un-issued fully-paid shares of Barney's Books Limited at $12.50 per share. The fair market value at the time of the grant was $17. One of the conditions was that he must exercise one-third of the option immediately upon it being granted. He did so and acquired 3,000 shares.

(B) Harry has summarized the following expenses related to his employment:

Gas and oilautomobile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,500

Meals (consumed while traveling away for more than 12 hours) . . . . . . . 8,000

House insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,200

Accommodation (while traveling on company business) . . . . . . . . . . . . . 12,000

Interest expensecar loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,600

General maintenance (house) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 900

Car insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,800

Car License 200

Hydro . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 800

Air travel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,800

Car maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000

Office supplies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,700

Fuel (house) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,200

Property taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,500

Mortgage interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,000

(C) Barney's Books Limited requires Harry to provide an automobile in order to carry out his duties of employment. Harry is responsible for his traveling expenses. On March 17, 2021, he acquired a new car where he financed part of the acquisition through a bank loan arranged for the same date. He estimates that he will drive 36,000 kilometers in the course of his employment. He expects his total kilometers to the end of the year to be 43,000. The car and the employment use are reasonable for his position and his work requirements.

(D) Harry's contract also requires that he maintain an office in his home, since no other office is provided. He is responsible for all costs related to the operation of the office. He does not receive an allowance or reimbursement related to any of these costs. Harry has estimated that the office occupies approximately 19% of his home. This estimate is based on square footage.

REQUIRED

Calculate Harry's employment income for 2021, assuming that all expenses are reasonable in the circumstances and will be documented. Do not calculate the CCA for the car for this question. For items excluded from your calculation, describe why you excluded them. Ignore consideration of the GST rebate