Kalec Inc. has a December 31 year end for both tax and accounting purposes. It is a Canadian controlled private company (CCPC) and, for the taxation year ending December 31, 2012, it had a Taxable Capital Employed in Canada of $1 1,556,000. The corresponding figure for the year ending December 31, 2011 was $12,235,000. Taxable Income for the 2012 taxation year was $879,000. This was made up of Canadian active business income of $762,000, along with foreign business income of $1 1 7,000. The foreign jurisdiction withheld $17,550 in taxes, remitting the balance of $99,450 to Kalec. The Company's 2012 gross revenues totalled $2,550,000, with 22 percent of this total being generated outside of Canada. Of their total 2012 wages of $895,000, 17 percent were paid outside of Canada. The revenues were earned and the wages paid in a country where Kalec has a permanent establishment. Kalec Inc. is required to share its small business deduction with three other associated compa- nies. They have agreed that Kalec would be allocated 40 percent of the total amount available