Taxation 1

Question 2 Mrs. Weasley, who is 68 years old, has correctly computed the following separate amounts in respect of income for tax purposes in 2020 for both her and her husband, who is 63 years old. (Amounts in brackets reflect losses or expenditures.) Mrs. Mr. Weasley. Weasley. Employment income - wages $ 8,000 Income tax withheld 1,200 CPP - employee portion 236 El - employee portion 126 Pension income (life annuity from a registered 52,000 pension plan) Old Age Security pension 7,362 Ineligible dividends (actual amount received) 12,000 Interest income 3,000 500 Allowable capital losses (3,000) RRSP contribution (fully deductible) (900) During 2020, she made donations to registered charities of $14,000 and incurred medical expenses for herself and her husband of $5,000. Assume Mrs. Weasley will not pension split with Mr. Weasley and she is subject to provincial tax of $5,000. Required: Using the format we learned in class, calculate Mrs. Weasley's net income for tax purposes, taxable income, and ultimate taxes payable for 2020