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Sharon is single, aged 69 and has the following information regarding the 2021 tax year: Actual amount of foreign dividends received in Canadian dollars, not

Sharon is single, aged 69 and has the following information regarding the 2021 tax year:

Actual amount of foreign dividends received in Canadian dollars, not subject to foreign taxes due to tax treaty

$547

Income tax deducted by payer of pension income

$5,800

Capital loss on disposal of shares in Air Seneca Inc.

$1,800

Pension Income

$56,000

Rental income

$3,200

RRSP contribution

$2,125

Actual amount of eligible dividends received

$700

She also sold her sailboat for $1,900 which cost her $750.

Required:

Calculate the following for Sharon to the extent that she wishes to pay the lowest taxes possible:

  1. Taxable income. Assume she has adequate RRSP contribution room. (5 marks)
  2. Federal tax before non-refundable tax credits (1 mark)
  3. Basic federal tax after non-refundable tax credits. (4 marks)
  4. Tax Owing or to be refunded. Ignore refundable tax credits. (2 marks)

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