Hello, I needed the solution to these question from a Canadian Taxation Course.

Question 1 & 3 are a bit calculation based and 2, 4, & 5 are short questions. Thank you

INDIVIDUALS: TAX BRACKETS Taxable income Up to $48,535 In excess of $48,535 In excess of $97,069 In excess of $150,473 > $214,368 Tax 15% $7,280 plus 20.5% on the next $48,534 $17,230 plus 26% on the next $53.404 $31,115 plus 29% on the next $63,895 $49,645 plus 33% on the remainder TAX CREDITS BASIC CREDIT = $13,229 x 15% = $1,984 SPOUSE/SPOUSAL EQUIVALENT (ELIGIBLE DEPENDENT) -15% x ($13,229 minus spouse/eligible dependent's net income) =$1,984 MAX Base amount increased by $2,273 (to $15.502) if the spouse/eligible dependent is mentally or physically infirm. CANADA CAREGIVER FOR CHILD $17,085) = $1,091 MAX AGE CREDIT = 15% (S7,637 - 15% x (net income - $38,508)) = $1,146 MAX PENSION CREDIT=15% x Ist $2,000 of "pension income"= 5300 maximum (not indexed) ADOPTION CREDIT = 15% of Ist $16,563 of eligible adoption expenses = $2,484 MAX CHARITABLE DONATIONS = [(15%MA)] + [(33%)(B)] + [(29%)(C)) (not indexed), where A = the first $200 B = the lesser of 1) total gifts less $200 and 2) taxable income less $214,368 C=the excess, if any, by which the total donations exceed the sum of $200 plus amount B (eligible donations generally limited to 75% of net income) MEDICAL EXPENSE CREDIT = 15% ((B-C) + D) where B = eligible medical expenses of the taxpayer, spouse or minor dependants C= the lesser of 3% of the taxpayer's net income and $2,397 D-E-F E = eligible medical expenses of the adult dependant F=the lesser of 3% of the adult dependant's net income and $2,397 DISABILITY CREDIT = 15% x $8,576 = $1,286 X POLITICAL DONATION TAX CREDIT (not indexed) = 75% first $400, 50% next $350 and 1/3 next $525... (5650 max credit overall) EDUCATION-RELATED CREDITS (not indexed) (a) TUITION CREDIT = 15% x eligible tuition fees (b) STUDENT LOAN INTEREST = 15% of interest paid on qualifying student loans; 5 year carry forward by student TRANSFER OF UNUSED CREDITS TO SPOUSE AND OTHERS Tuition (to parents and grandparents if no spouse) Age (to spouse only) Pension (to spouse only) Disability to child, grandchild,parent , grandparent, brother, sister, aunt, uncle, nephew, niece of the taxpayer or the taxpayer's spouse) Dependent must first use personal, EI and CPP credits before being able to use these credits El & CPP s. 118.7 = El & CPP premiums @ 15% (El & CPP premiums will be given to you) - El Credit 15% x $856 = $128 MAX -CPP Credit - 15% * $2,732 = $410 MAX CANADA EMPLOYMENT CREDIT = 15% x lesser of employment income or $1,245 = $187 MAX DIVIDEND TAX CREDIT: - for eligible dividends - 6/11 of 38% gross-up - for other dividends from taxable Canadian corporations = 9/13 of 15% gross-up FIRST TIME HOMEBYER'S TAX CREDIT = 15% X $5,000 of a cost of a qualifying home ($750 MAX) CORPORATE TAXES: Basic corporate rate: 38% Federal abatement: (10%) Small business deduction (if applicable): (19%) General rate reduction (if applicable): (13%) QUESTION 1/20 morts Los Pasteles Verdes Ltd. ("the Company has a fiscal year ending December 31. For the year ending December 31, 2020, the Company's income statement is as follow Revenues $950,000 Expenses: Cost of Goods Sold (5206,000) Administrative Costs 1152.000) Amortization Expense (173,000 Increase in warranty reserves (32.000) Other Expenses 187.000) 1650,000 Income Before Tax Expense $300,000 Income Tax Expense: Current 1$36,0001 Future 112.000 (48.000 Net Income $252,000 Other Information: 1 During the year. $6,000 was spent on landscaping for its new cities. For accounting purposes this was capitalized as an asset. The Company believes the work has an unlimited life and has decided not to amortize this balance 2 The Company incurred legal costs to make amendments to its articles of incorporation in 2020 These legal costs totaling 59.500 were included in Other Expenses 3. On January 1, 2020, the Company has UCC bulances for its tangible assets as follow Class 1 (4 CCA rate) $450,000 Class 14.1 (5% CCA rate) NI The Class 1 balance relates to a single building acquired in 2005 at a cost of $500,000 including the surrounding land. The value and cost of the land at the time of acquisition was $50,000. On February 10, 2020, this building and the land are sold for a total of $662.000. The value of the land is unchanged at $50,000. In the accounting records, this real property was carried at 5557,000 $507,000 for the building and $50,000 for the land. The resulting gain on the building is included in the accounting revenues. The old building is replaced on February 15, 2020 with a new building acquired at a cost of $733,000 of which $60,000 is allocated to land. The Company chose not to put the new building into a separate Class 1 so it does not qualify for the percent CCA rate. No elections are made with respect to the replacement of the building 4. The Company was late on paying some income tax instalments as well as some municipal tax payments, resulting in interest being incurred in the amounts of $540 and $320, respectively. This interest was included in Other Expenses. 5 The Company would like to deduct the maximum CCA allowable for the year. Page 1 of 2 Name: Student No: Section -REQUIRED A Determine the 2020 minimum Net Income For Tax Purposes. Please calculate the lanuary 1, 2021 UCC for all of the Company's CCA dasses. Show all of your work whether or not you feel it is relevant to your final answer. [15 Marks B! Explain, in words, the reason for the inclusion for eaction of each item in your calculation of the Company's net income in Part A You can use point form. [15 Marks] Name: Student No.: Section: QUESTION 2 (14 marks] Drako owns 50,000 shares of Diamond Hands Inc., a publicly traded Canadian corporation. These shares were acquired several years ago at a total cost of $135,000. The shares are now worth $210,000 In each of the following cases, assume that the purchaser immediately resells the shares for their fair market value of $210,000 Case 1 Drako sells the shares to an arm's length party for $210,000 Case 2 Drako gifts the shares to his 16 year old daughter. Case 3 Drako sells the shares to his adult sister for $110,000 Case 4 Drako sells the shares to his grandfather for $260,000 -REQUIRED A) for each of the Cases, determine the tax consequences of the disposition to Drako and the tax consequences to the purchaser on the resale of the shares. [7 Marks] B) For each of the four cases in Part A, explain why adjustments were required, or not required, to Drako's proceeds of disposition or the purchaser's cost. [7 Marks] QUESTION mark Hack Ganga and is played by a Canadianbet 5212,06 one of which is common. Because of his outstanding 220, e has been wrede $20.000 bonut of the boat we paid in December 22 her hat will be paid in employer be withheld professional section des 3.400 and combine the Sick Also we werdendo en control. The mode contion to the plan of ack's spouse, Margarita Cine years Herrer Tourses is 7.320 The couple are hide whether there is allow Sherry 11 years old na podstand time 2825 Surettes sans old and has enous recruitment her from working on a She is income from 2250 Sharon 23 year old and entendentes o months of the year. Jack pays her ton fees of..og with 10. She sind eithe hat come $34.300 times during her cholars Other information 1. 2017, lack received to use fors.com stock at a price of 572 per share. At the time the wrotestock was 570 per share nr2020 when the shores retraga Serrelaksalot the Option de les lleiding the shorthand see 2. During 2030, la recept from As a reward for the company writerien el rekend in any other foreckage An the case for them 5000 mg $1.200 artificate on . Water. The company rides with best one foot The stadiet see During 2030, sacker 400 on entrelated mattern trand entertainment with its of his employers entre 500 af hots Page 1 of 2 During 2020, duck and Margarita decided to urdu memerhavented for the last year Aer considerable singelytheerfect propertybios from the rented parties and purchase or 2.000. As lover's policy Jacks granted an interest free of 200.000 The granted on Art.2020. Ama herred 5. During 2020, bo Sherry and Sharon had ik had to pay $2.800 for emergency vicester Sherryne suffered toga Muay Thala. hoe $13.500 for playground Short which she believes prayidhethemended the following edilepenies of the familieof which were back lack and Margerite 2.300 2.000 22.00 36.000 REQUIRED A) Calate Mr. Chang's minimale come and federal steel for the you ended December 31, 2020. Show all your You finalu Merkel 1 El Charges forces. You can use poinfo.se Mart! 14 Expires the income theme of the tota Martat Sery Question 4 [13 marks] Garth Garson, your client, is a successful business owner. Garth is the sole shareholder of Never Give Up Inc. ("NGU"), a Canadian corporation. NGU earns $500,000 of business income each year that qualifies for the small business deduction. Garth has plans to acquire new businesses and make other investments. NGU has recently acquired 100% of the shares of Chain Inc. ("Chain"), a taxable Canadian corporation, from a third-party seller. Chain has a minority shareholding in Pajaro Inc. ("Pajaro"), representing 9% of votes and 18% of value in Pajaro. Garth would like to understand the tax treatment of following items: a) What is the tax treatment of future dividends paid by Pajaro to Chain? Why? [2 marks] b) What is the tax treatment of future dividends paid by Chain to NGU? Why? [3 marks] c) Whether the business income earned by Chain is eligible for a small business deduction. Why? [2 marks] NGU has generated significant excess cash from its business operations that Garth would like the corporation to invest in a marketable securities portfolio comprised of shares of various dividend-paying U.S. public corporations. Garth would like to understand the tax treatment of the following items: d) NGU will pay 15% U.S. dividend withholding tax on dividends from the portfolio. What is the treatment of the U.S. dividend withholding tax in calculating taxes payable in Canada? Explain the rationale. [2 marks] e) Garth plans to trade NGU's marketable securities portfolio on an ongoing basis from time to time to generate some gains. Garth enjoys reading daily business news and researching equity markets to pick the best-performing stocks for this portfolio. That being said, Garth does not have any specialized knowledge in trading securities, although he indicated that he is thinking of enrolling into several technical analysis courses taught by popular TikTok influencers so that he can learn how to become a better trader. Garth is curious to know how the trading income from the portfolio will be characterized for tax purposes and what factors and considerations are relevant to this determination. [4 marks] -REQUIRED Address, in words, each of the items above. QUESTION 5 [7 marks] Mouna established an RRSP in 2013. As of January 1, 2019, Mouna had no unused deduction room and no undeducted contributions. Her 2018 earned income was sufficient for her to make the maximum 2019 contribution of $26,500. However, as she acquired a new home during 2019, she made no contributions to her RRSP that year. With the new home and furnishing purchases behind her and the receipt of a sizable inheritance from her father's estate, she has sufficient funds to maximize her contribution in 2020. She would like you to advise her as to the maximum contribution that she can make in 2020. Her 2019 earned income was $185,000. Her 2019 net income was $240,000. Mouna's spouse Bob had 2019 earned income and net income of $30,000. Bob will likely have less income than Mouna in their retirement. The RRSP dollar limits are $26,500 for 2019 and $27,230 for 2020. -REQUIRED A) Calculate the maximum 2020 RRSP contribution that Mouna can make. Show your work. [3 marks] B) Should Mouna consider making some of the 2020 contribution to Bob's RRSP? Explain. [2 marks] C) How and why would your answer to A) change if Mouna was part of a registered pension plan (RPP) in 2019 and her employer contributed to the RPP in 2019? [2 marks] INDIVIDUALS: TAX BRACKETS Taxable income Up to $48,535 In excess of $48,535 In excess of $97,069 In excess of $150,473 > $214,368 Tax 15% $7,280 plus 20.5% on the next $48,534 $17,230 plus 26% on the next $53.404 $31,115 plus 29% on the next $63,895 $49,645 plus 33% on the remainder TAX CREDITS BASIC CREDIT = $13,229 x 15% = $1,984 SPOUSE/SPOUSAL EQUIVALENT (ELIGIBLE DEPENDENT) -15% x ($13,229 minus spouse/eligible dependent's net income) =$1,984 MAX Base amount increased by $2,273 (to $15.502) if the spouse/eligible dependent is mentally or physically infirm. CANADA CAREGIVER FOR CHILD $17,085) = $1,091 MAX AGE CREDIT = 15% (S7,637 - 15% x (net income - $38,508)) = $1,146 MAX PENSION CREDIT=15% x Ist $2,000 of "pension income"= 5300 maximum (not indexed) ADOPTION CREDIT = 15% of Ist $16,563 of eligible adoption expenses = $2,484 MAX CHARITABLE DONATIONS = [(15%MA)] + [(33%)(B)] + [(29%)(C)) (not indexed), where A = the first $200 B = the lesser of 1) total gifts less $200 and 2) taxable income less $214,368 C=the excess, if any, by which the total donations exceed the sum of $200 plus amount B (eligible donations generally limited to 75% of net income) MEDICAL EXPENSE CREDIT = 15% ((B-C) + D) where B = eligible medical expenses of the taxpayer, spouse or minor dependants C= the lesser of 3% of the taxpayer's net income and $2,397 D-E-F E = eligible medical expenses of the adult dependant F=the lesser of 3% of the adult dependant's net income and $2,397 DISABILITY CREDIT = 15% x $8,576 = $1,286 X POLITICAL DONATION TAX CREDIT (not indexed) = 75% first $400, 50% next $350 and 1/3 next $525... (5650 max credit overall) EDUCATION-RELATED CREDITS (not indexed) (a) TUITION CREDIT = 15% x eligible tuition fees (b) STUDENT LOAN INTEREST = 15% of interest paid on qualifying student loans; 5 year carry forward by student TRANSFER OF UNUSED CREDITS TO SPOUSE AND OTHERS Tuition (to parents and grandparents if no spouse) Age (to spouse only) Pension (to spouse only) Disability to child, grandchild,parent , grandparent, brother, sister, aunt, uncle, nephew, niece of the taxpayer or the taxpayer's spouse) Dependent must first use personal, EI and CPP credits before being able to use these credits El & CPP s. 118.7 = El & CPP premiums @ 15% (El & CPP premiums will be given to you) - El Credit 15% x $856 = $128 MAX -CPP Credit - 15% * $2,732 = $410 MAX CANADA EMPLOYMENT CREDIT = 15% x lesser of employment income or $1,245 = $187 MAX DIVIDEND TAX CREDIT: - for eligible dividends - 6/11 of 38% gross-up - for other dividends from taxable Canadian corporations = 9/13 of 15% gross-up FIRST TIME HOMEBYER'S TAX CREDIT = 15% X $5,000 of a cost of a qualifying home ($750 MAX) CORPORATE TAXES: Basic corporate rate: 38% Federal abatement: (10%) Small business deduction (if applicable): (19%) General rate reduction (if applicable): (13%) QUESTION 1/20 morts Los Pasteles Verdes Ltd. ("the Company has a fiscal year ending December 31. For the year ending December 31, 2020, the Company's income statement is as follow Revenues $950,000 Expenses: Cost of Goods Sold (5206,000) Administrative Costs 1152.000) Amortization Expense (173,000 Increase in warranty reserves (32.000) Other Expenses 187.000) 1650,000 Income Before Tax Expense $300,000 Income Tax Expense: Current 1$36,0001 Future 112.000 (48.000 Net Income $252,000 Other Information: 1 During the year. $6,000 was spent on landscaping for its new cities. For accounting purposes this was capitalized as an asset. The Company believes the work has an unlimited life and has decided not to amortize this balance 2 The Company incurred legal costs to make amendments to its articles of incorporation in 2020 These legal costs totaling 59.500 were included in Other Expenses 3. On January 1, 2020, the Company has UCC bulances for its tangible assets as follow Class 1 (4 CCA rate) $450,000 Class 14.1 (5% CCA rate) NI The Class 1 balance relates to a single building acquired in 2005 at a cost of $500,000 including the surrounding land. The value and cost of the land at the time of acquisition was $50,000. On February 10, 2020, this building and the land are sold for a total of $662.000. The value of the land is unchanged at $50,000. In the accounting records, this real property was carried at 5557,000 $507,000 for the building and $50,000 for the land. The resulting gain on the building is included in the accounting revenues. The old building is replaced on February 15, 2020 with a new building acquired at a cost of $733,000 of which $60,000 is allocated to land. The Company chose not to put the new building into a separate Class 1 so it does not qualify for the percent CCA rate. No elections are made with respect to the replacement of the building 4. The Company was late on paying some income tax instalments as well as some municipal tax payments, resulting in interest being incurred in the amounts of $540 and $320, respectively. This interest was included in Other Expenses. 5 The Company would like to deduct the maximum CCA allowable for the year. Page 1 of 2 Name: Student No: Section -REQUIRED A Determine the 2020 minimum Net Income For Tax Purposes. Please calculate the lanuary 1, 2021 UCC for all of the Company's CCA dasses. Show all of your work whether or not you feel it is relevant to your final answer. [15 Marks B! Explain, in words, the reason for the inclusion for eaction of each item in your calculation of the Company's net income in Part A You can use point form. [15 Marks] Name: Student No.: Section: QUESTION 2 (14 marks] Drako owns 50,000 shares of Diamond Hands Inc., a publicly traded Canadian corporation. These shares were acquired several years ago at a total cost of $135,000. The shares are now worth $210,000 In each of the following cases, assume that the purchaser immediately resells the shares for their fair market value of $210,000 Case 1 Drako sells the shares to an arm's length party for $210,000 Case 2 Drako gifts the shares to his 16 year old daughter. Case 3 Drako sells the shares to his adult sister for $110,000 Case 4 Drako sells the shares to his grandfather for $260,000 -REQUIRED A) for each of the Cases, determine the tax consequences of the disposition to Drako and the tax consequences to the purchaser on the resale of the shares. [7 Marks] B) For each of the four cases in Part A, explain why adjustments were required, or not required, to Drako's proceeds of disposition or the purchaser's cost. [7 Marks] QUESTION mark Hack Ganga and is played by a Canadianbet 5212,06 one of which is common. Because of his outstanding 220, e has been wrede $20.000 bonut of the boat we paid in December 22 her hat will be paid in employer be withheld professional section des 3.400 and combine the Sick Also we werdendo en control. The mode contion to the plan of ack's spouse, Margarita Cine years Herrer Tourses is 7.320 The couple are hide whether there is allow Sherry 11 years old na podstand time 2825 Surettes sans old and has enous recruitment her from working on a She is income from 2250 Sharon 23 year old and entendentes o months of the year. Jack pays her ton fees of..og with 10. She sind eithe hat come $34.300 times during her cholars Other information 1. 2017, lack received to use fors.com stock at a price of 572 per share. At the time the wrotestock was 570 per share nr2020 when the shores retraga Serrelaksalot the Option de les lleiding the shorthand see 2. During 2030, la recept from As a reward for the company writerien el rekend in any other foreckage An the case for them 5000 mg $1.200 artificate on . Water. The company rides with best one foot The stadiet see During 2030, sacker 400 on entrelated mattern trand entertainment with its of his employers entre 500 af hots Page 1 of 2 During 2020, duck and Margarita decided to urdu memerhavented for the last year Aer considerable singelytheerfect propertybios from the rented parties and purchase or 2.000. As lover's policy Jacks granted an interest free of 200.000 The granted on Art.2020. Ama herred 5. During 2020, bo Sherry and Sharon had ik had to pay $2.800 for emergency vicester Sherryne suffered toga Muay Thala. hoe $13.500 for playground Short which she believes prayidhethemended the following edilepenies of the familieof which were back lack and Margerite 2.300 2.000 22.00 36.000 REQUIRED A) Calate Mr. Chang's minimale come and federal steel for the you ended December 31, 2020. Show all your You finalu Merkel 1 El Charges forces. You can use poinfo.se Mart! 14 Expires the income theme of the tota Martat Sery Question 4 [13 marks] Garth Garson, your client, is a successful business owner. Garth is the sole shareholder of Never Give Up Inc. ("NGU"), a Canadian corporation. NGU earns $500,000 of business income each year that qualifies for the small business deduction. Garth has plans to acquire new businesses and make other investments. NGU has recently acquired 100% of the shares of Chain Inc. ("Chain"), a taxable Canadian corporation, from a third-party seller. Chain has a minority shareholding in Pajaro Inc. ("Pajaro"), representing 9% of votes and 18% of value in Pajaro. Garth would like to understand the tax treatment of following items: a) What is the tax treatment of future dividends paid by Pajaro to Chain? Why? [2 marks] b) What is the tax treatment of future dividends paid by Chain to NGU? Why? [3 marks] c) Whether the business income earned by Chain is eligible for a small business deduction. Why? [2 marks] NGU has generated significant excess cash from its business operations that Garth would like the corporation to invest in a marketable securities portfolio comprised of shares of various dividend-paying U.S. public corporations. Garth would like to understand the tax treatment of the following items: d) NGU will pay 15% U.S. dividend withholding tax on dividends from the portfolio. What is the treatment of the U.S. dividend withholding tax in calculating taxes payable in Canada? Explain the rationale. [2 marks] e) Garth plans to trade NGU's marketable securities portfolio on an ongoing basis from time to time to generate some gains. Garth enjoys reading daily business news and researching equity markets to pick the best-performing stocks for this portfolio. That being said, Garth does not have any specialized knowledge in trading securities, although he indicated that he is thinking of enrolling into several technical analysis courses taught by popular TikTok influencers so that he can learn how to become a better trader. Garth is curious to know how the trading income from the portfolio will be characterized for tax purposes and what factors and considerations are relevant to this determination. [4 marks] -REQUIRED Address, in words, each of the items above. QUESTION 5 [7 marks] Mouna established an RRSP in 2013. As of January 1, 2019, Mouna had no unused deduction room and no undeducted contributions. Her 2018 earned income was sufficient for her to make the maximum 2019 contribution of $26,500. However, as she acquired a new home during 2019, she made no contributions to her RRSP that year. With the new home and furnishing purchases behind her and the receipt of a sizable inheritance from her father's estate, she has sufficient funds to maximize her contribution in 2020. She would like you to advise her as to the maximum contribution that she can make in 2020. Her 2019 earned income was $185,000. Her 2019 net income was $240,000. Mouna's spouse Bob had 2019 earned income and net income of $30,000. Bob will likely have less income than Mouna in their retirement. The RRSP dollar limits are $26,500 for 2019 and $27,230 for 2020. -REQUIRED A) Calculate the maximum 2020 RRSP contribution that Mouna can make. Show your work. [3 marks] B) Should Mouna consider making some of the 2020 contribution to Bob's RRSP? Explain. [2 marks] C) How and why would your answer to A) change if Mouna was part of a registered pension plan (RPP) in 2019 and her employer contributed to the RPP in 2019? [2 marks]