(show calculations) You were hired as a commissioned salesman in July 2020. You received a salary of $60,000, and $5,000 of commissions. $6,000 of commissions you earned in December will be paid in January 2021. Because you travel to negotiate sales contracts, you pay your own vehicle and promotional expenses. Your employer has signed a Form T2200 and certified that no reimbursements were paid. You incurred the following expenses from July through December 2020:

Meals and entertainment for potential customers $20,000

Driving costs (90% of driving was for employment purposes):

Fuel 4,000

Insurance 750

Repairs 2,250

Leasing costs ($500 per month) 3,000

What is the maximum deduction you can claim under ITA 8 for employment expenses?

A) $5,000.

B) $9,000.

C) $11,000.

D) $16,000.

Part 1 (ITA 3) Division B Net Income to Division C Taxable income to Taxes Payable for Individuals + Bin #1 - Net Employment - losses carry forward 20 years and carry back 3 years (carrying baskets) ITA 3(a) + Bin # 2 - Net Business & Property - losses carry forward 20 years and carry back 3 years (carrying baskets) + Bin #4 - Other Income ITA 3 (b) + Bin #3 - Net Capital - losses carry forward for infinity and carry back 3 years (carrying basket) ITA 3 (C) - Bin #5 - Other Deductions = Sources of Income ITA 3 (d) Losses in current year from Bins 1, 2,4 = Division B Net Income ITA 110 Equivalent to Capital Gains Deduction for Employee Stock Options Payments included to calculation Division B but not included for Division C (e.g. social assistance) - Losses from other years (carrying baskets Bin #1 & 2) Losses from other years (carrying basket Bin #3 limited to Net Capital Income included in ITA 3 (b)) ITA 111 = Division C Taxable income X Applicable Tax Rates ITA 118 Tax Credits = Division E Taxes Payable for Individuals