Ms. Sarah Smith is 42 years old and divorced from her former spouse. She has two children from the marriage, Natalie, aged 4 and Bram, aged 9. Neither of these children have any 2022 income.

The divorce decree, which was issued in 2020, requires her former spouse to pay $3,000 per month in child support and an additional $1,000 per month in spousal support. While all of the payments for previous years have been made, during 2022, her former spouse has experienced financial difficulties and has paid only $40,000 of the required amounts.

Ms. Smith also provides care for her 85-year-old grandfather who lives with her and her children. While her grandfather is not mentally or physically infirm, his 2022 income was only $7,950, leaving him as a dependant of Ms. Smith.

Ms. Smith is employed by Foods Ltd., a large public company. For 2022, she has a base salary of $75,000 per year. During 2021, she was awarded a bonus of $20,028, all of which was paid in January, 2022.

For her employment related travel, the company provides her with an automobile. Ms. Smith provided an accounting department with a log of total kilometers driven and how many kilometers were for employment related use. Based on this information, the accounting department correctly calculated a standby charge of $1,845. Ms. Smith is required to pay all of her own operating and maintenance costs on the automobile. She paid $5,103 in gas and maintenance, all related to the employment use of the automobile.

Her employer withheld the following amounts from her 2022 earnings:

RPP Contributions $3,400

EI Premiums 953

CPP Contributions 3,500

During 2022, Ms. Smith is transferred by Foods Ltd. from their Edmonton office to their Calgary office. The Company is providing a $28,000 allowance to cover any costs of the move.

On January 3, 2022, Ms. Smith flies to Calgary at a cost of $325 to locate a new residence for her and her family. During the three days that she is there, her food and lodging costs total $575. Both the air fare and the food and lodging costs are reimbursed by Foods Ltd. After considering the properties that she has seen, she makes an offer on a property on January 10. The offer is accepted that same day.

Later that month she sells her Edmonton home which she purchased for $265,000 in 2019. The house is sold for $257,800. While Ms. Smith managed to sell the house without using a real estate agent, legal fees associated with the sale total $950.

Ms. Smith and her family leave Edmonton on March 15 and arrive in Calgary that same day. She uses her companys car to transport herself and her family. As the family brought a picnic lunch for the trip, she ignores food costs for the day.

Unfortunately, her new Calgary home is not available until April 3 and, as a consequence, she, her children and her grandfather stay in a Calgary suite hotel from March 15 through April 3 (19 days). The rate for a two-room suite is $325 per day, but Ms. Smith has a discount voucher that gives her a rate of $200 per day for three days.

Assume that the 2022 rate for meals is $69 per day per person.

The cost for moving her household effects and leaving them in storage until her Calgary home was ready totaled $3,640. Her legal fees associated with acquiring the Calgary home are $600.

Ms. Smith has belonged to her employers stock purchase plan since 2020. In that year she acquired 360 shares at $5.00 per share. In 2021, she acquired an additional 500 shares at $5.25 per share. On February 1, 2022, she acquired 400 more shares at $6.00 per share. On July 1, 2022, all of her shares paid an eligible dividend of $0.30 per share.

In order to help finance some of the costs of the move, she sold 900 of these shares in December, 2022 at $6.10 per share.

On January 1, 2022, Ms. Smith purchases an annuity for $28,733. The annuity was purchased with after-tax funds and will provide a payment of $5,000 at the end of each year for eight years. Given its price, the return of capital in each payment is 3,592.

During 2022, Ms. Smith contributes $6,000 to her Tax-Free Savings Account (TFSA).

Before moving to Calgary, child care costs in Edmonton were $200 per week for 11 weeks. In Calgary, the weekly cost increased to $250 per week and was paid for a total of 36 weeks. In the summer, both children spent four weeks at an exclusive summer camp. The fees at this camp were $500 per child per week.

The 2022 medical expenses for Ms. Smith and her dependants, which were all paid for by Ms. Smith, are as follows:

Ms. Smith $ 465

Natalie 493

Bram 245

Grandfather 12,473

Total Medical Expenses $13,676

Calculate your clients federal taxes owing or refundable for 2022.