Question 1 For the past five years, Mr Brooks has been employed as a financial analyst by a large Canadian public firm located in Winnipeg During 2020, his basic gross salary amounts to $63,000 In addition, he was awarded an $11,000 bonus based on the performance of his division Of the total bonus, $6,500 was paid in 2020 and the remainder is to be paid on January 15, 2021 During 2020, Mr Brooks employer withheld the following amounts from his gross wages Federal Income Tax $3,000 Employment Insurance Premiums 856 Canada Pension Plan Contributions 2,898 Registered Pension Plan Contributions 2,800 Donations to the United way (charity) 480 Union Dues 240 Payments for Personal Use of Company Car 1,000 Other Information Due to an airplane accident while flying back from Thunder Bay on business, Mr Brooks was seriously injured and confined to a hospital for two full months during 2020 As his employer provides complete group disability insurance coverage, he received a total of $4,200 in payments during this period All of the premiums for this insurance plan are paid by the employer The plan provides periodic benefits that compensate for lost employment income Mr Brooks is provided with a car that the company leases at a rate of $678 per month, including both GST and PST The company pays for all of the operating costs of the car, and these amounted to $3,500 during 2020 Mr Brooks drove the car a total of 35,000 kilometres during 2020, 30,000 kilometres of which were carefully documented as employment related travel While he was in the hospital (see Item 1), his employer required that the care be returned to company premises, so it was not available to him On January 15, 2019, Mr Brooks received options to buy 200 shares of his employers common stock at a price of $23 per share At this time, the shares were trading at $20 per share Mr Brooks exercised these options on July 6, 2020, when the shares were trading at $28 per share He does not plan to sell the shares for at least a year In order to assist Mr Brooks in acquiring a new personal residence in Winnipeg, his employer granted him a five year, interest free loan of $125,000 The loan qualifies as a home relocation loan The loan was granted on October 1, 2020, and, at that point in time, the prescribed interest rate set by the CRA is 2 Other disbursements made by Mr Brooks include the following Advanced financial accounting course tuition fees $1,200 Music history course tuition fees 600 Fees paid to financial planner 300 Payment of premiums on life insurance 642 Mr Brooks employer reimbursed him for the tuition for the accounting course, but not for any of these other expenses Required Calculate Mr Brooks net employment income for the taxation year ending December 31, 2020

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Question 1 For the past five years, Mr. Brooks has been employed as a financial analyst by a large Canadian public firm located in Winnipeg.

Question 1

For the past five years, Mr. Brooks has been employed as a financial analyst by a large Canadian public firm located in Winnipeg. During 2020, his basic gross salary amounts to $63,000. In addition, he was awarded an $11,000 bonus based on the performance of his division. Of the total bonus, $6,500 was paid in 2020 and the remainder is to be paid on January 15, 2021.

During 2020, Mr. Brooks employer withheld the following amounts from his gross wages:

Federal Income Tax $3,000

Employment Insurance Premiums 856

Canada Pension Plan Contributions 2,898

Registered Pension Plan Contributions 2,800

Donations to the United way (charity) 480

Union Dues 240

Payments for Personal Use of Company Car 1,000

Other Information:

Due to an airplane accident while flying back from Thunder Bay on business, Mr. Brooks was seriously injured and confined to a hospital for two full months during 2020. As his employer provides complete group disability insurance coverage, he received a total of $4,200 in payments during this period. All of the premiums for this insurance plan are paid by the employer. The plan provides periodic benefits that compensate for lost employment income.
Mr. Brooks is provided with a car that the company leases at a rate of $678 per month, including both GST and PST. The company pays for all of the operating costs of the car, and these amounted to $3,500 during 2020. Mr. Brooks drove the car a total of 35,000 kilometres during 2020, 30,000 kilometres of which were carefully documented as employment-related travel. While he was in the hospital (see Item 1), his employer required that the care be returned to company premises, so it was not available to him.
On January 15, 2019, Mr. Brooks received options to buy 200 shares of his employers common stock at a price of $23 per share. At this time, the shares were trading at $20 per share. Mr. Brooks exercised these options on July 6, 2020, when the shares were trading at $28 per share. He does not plan to sell the shares for at least a year.
In order to assist Mr. Brooks in acquiring a new personal residence in Winnipeg, his employer granted him a five year, interest free loan of $125,000. The loan qualifies as a home relocation loan. The loan was granted on October 1, 2020, and, at that point in time, the prescribed interest rate set by the CRA is 2%.
Other disbursements made by Mr. Brooks include the following:

Advanced financial accounting course tuition fees $1,200

Music history course tuition fees 600

Fees paid to financial planner 300

Payment of premiums on life insurance 642

Mr. Brooks employer reimbursed him for the tuition for the accounting course, but not for any of these other expenses.

Required:

Calculate Mr. Brooks net employment income for the taxation year ending December 31, 2020.