Robin Brown is a professional engineer. In 2020, she sold her consulting business in Mississauga, Ontario, and moved to Calgary, Alberta, where she was employed by an equipment manufacturing business. The following financial information is provided for 2020. 1. Robin began her employment on February 1, and during the year, received a salary of $85,000, from which the employer deducted income tax of $27,000 and CPP and El of $3,754. In addition to her salary, Robin earned a commission of 2% of sales obtained by salespeople under her supervision. At December 31, these sales amounted to $700,000, for which she had received commissions of $6,500 by the end of the year, with the balance received in January 2021. Robin also received an annual clothing allowance of $1,300. During the year, she pent $1,600 on clothing for work Robin's employer does not have a company pension plan; instead, the employer contributed $11,000 directly to her RRSP. 2. 3. 4. In December, Robin received a payroll advance of $5,000 against her January 2021 salary to help fund a family holiday. 5. Robin is required to use her automobile for employment purposes and to pay certain other employment expenses. She incurred the following costs: Meals and drinks for customer entertainment Golf club dues used to entertain customers Travel-airfares and hotel lodging $ 2,500 1,200 2,700 1,200 1,400 Purchase of an iPhone 12 Cell phone bill-pay-as-you-go plan (employment related) Automobile expenses: Operating costs Parking (employment related) Interest on car loan Purchase of new automobile (includes 13% HST) 3,500 200 4,200 95,000 The automobile was purchased on February 1, 2020 and was used 70% of the time for employment purposes. 6. Robin took advantage of her employer's counselling services. She received personal financial planning advice valued at $600, and her 14-year-old son received mental health counselling valued at $800. 7 Robin purchased a new home in Calgary and incurred qualified moving expenses of $16,000 to transport her family and household effects to Calgary. Her new employer reimbursed her for $12,000 of these costs and paid her $25,000 for the loss incurred on the sale of her former residence. 8. In early 2021, Robin intends to borrow $30,000 from her employer to assist with acquiring shares in the employer's corporation. A low interest rate of 2% per annum will be payable on the loan. Required: (a) Determine Robin's net income from employment for 2020, I List and briefly explain why you omitted any items from your answer in part (a). (b) (c) Briefly describe the tax implications from the intended employee loan to Robin. Robin Brown is a professional engineer. In 2020, she sold her consulting business in Mississauga, Ontario, and moved to Calgary, Alberta, where she was employed by an equipment manufacturing business. The following financial information is provided for 2020. 1. Robin began her employment on February 1, and during the year, received a salary of $85,000, from which the employer deducted income tax of $27,000 and CPP and El of $3,754. In addition to her salary, Robin earned a commission of 2% of sales obtained by salespeople under her supervision. At December 31, these sales amounted to $700,000, for which she had received commissions of $6,500 by the end of the year, with the balance received in January 2021. Robin also received an annual clothing allowance of $1,300. During the year, she pent $1,600 on clothing for work Robin's employer does not have a company pension plan; instead, the employer contributed $11,000 directly to her RRSP. 2. 3. 4. In December, Robin received a payroll advance of $5,000 against her January 2021 salary to help fund a family holiday. 5. Robin is required to use her automobile for employment purposes and to pay certain other employment expenses. She incurred the following costs: Meals and drinks for customer entertainment Golf club dues used to entertain customers Travel-airfares and hotel lodging $ 2,500 1,200 2,700 1,200 1,400 Purchase of an iPhone 12 Cell phone bill-pay-as-you-go plan (employment related) Automobile expenses: Operating costs Parking (employment related) Interest on car loan Purchase of new automobile (includes 13% HST) 3,500 200 4,200 95,000 The automobile was purchased on February 1, 2020 and was used 70% of the time for employment purposes. 6. Robin took advantage of her employer's counselling services. She received personal financial planning advice valued at $600, and her 14-year-old son received mental health counselling valued at $800. 7 Robin purchased a new home in Calgary and incurred qualified moving expenses of $16,000 to transport her family and household effects to Calgary. Her new employer reimbursed her for $12,000 of these costs and paid her $25,000 for the loss incurred on the sale of her former residence. 8. In early 2021, Robin intends to borrow $30,000 from her employer to assist with acquiring shares in the employer's corporation. A low interest rate of 2% per annum will be payable on the loan. Required: (a) Determine Robin's net income from employment for 2020, I List and briefly explain why you omitted any items from your answer in part (a). (b) (c) Briefly describe the tax implications from the intended employee loan to Robin
