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House Inc. is a CCPC that operates in British Columbia. For 2023 relevant corporate tax rates are as follows: House Inc. is owned by two
House Inc. is a CCPC that operates in British Columbia. For 2023 relevant corporate tax rates are as follows: House Inc. is owned by two Canadian resident shareholders. Assume their tax rate is 33%. Gross up for eligible dividends is 38% and non-eligible dividends is 15%. The dividend tax credit rate is 15% for eligible dividends and 9% for non-eligible dividends. Calculate the combined taxes payable (corporate and individual) under the following mutually exclusive scenarios. 1. House Inc. earns active business income of $500,000 in the year and does not pay any dividends. 2. House Inc. earns active business income of $500,000 in the year and pays an annual dividend of $200,000. 3. House Inc. earns investment income of $500,000 in the year and does not pay any dividends. 4. House Inc. earns investment income of $500,000 in the year and pays an annual dividend of $200,000. 5. House Inc. earns active business income of $700,000 in the year and does not pay any dividends. 6. House Inc. earns active business income of $700,000 in the year and pays a $200,000 dividend
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