The schedule below outlines the net income for income tax purposes $($by source$)$ of Sunday Media Incorporated $($SMI$),$ a Canadian$-$controlled private corporation wholly owned by Ms$.$ Clark, for its fiscal year ended December $31,2023.$ The Toronto$-$based company is a wholesale company with corporate and public clients and is located only in Ontario.

Sunday Media Inc.

Net Income for Income Tax Purposes $($by Source$)$

for the Year Ended December $31,2023$

Income from Wholesale sales net of all capital cost allowance $$345,300$

Interest income$70,000$

Dividend income $51,000$

Foreign non$-$business income in Cdn $ $($Net amount$)($Note $8)15,000$

Taxable capital gain $($non$-$active$)27,000$

Net income for income tax purposes $$508,300$

Additional Information:

$1.$ Interest income is derived from the following sources:

$($a$)10-$year bond in IBM Ltd$.,$ a Canadian company $$40,000$

$($b$)$ Interest on term load to Saturn Limited a Canadian company $30,000$

$$70,000$

Note:$$ SMI owns $51\%$ of Saturn Limited. The other $49\%$ is owned by Roger$$s corporation a public company$$

$2.$ Dividend income is derived from the following sources:

$($a$)$ Saturn Limited $($eligible$)$ $$35,000$

$($b$)$ Fox Corp. $($Canada$)$ Ltd$.$ CCPC $(10\%$ shareholder non$-$eligible$)14,000$

$($c$)$ ABC Investment Co$.(1\%$ shareholder eligible$)2,000$

$$51,000$

$3.$ Sale of non$-$active assets during the year resulted in the taxable capital gain of $$27,000$

$4.$ Saturn Limited $($Saturn$)$ had taxable income of $$623,000$ for the year ending March $31,2023,$ all of which was active business income.

Saturn was allocated a Small Business Limit of $$80,000$ for the year

Saturn received a dividend refund of $$21,000$ when it paid out dividends of $$68,627$ on its shares.

$5.$ During the year, SMI paid eligible dividends to Ms$.$ Clark totalling $$45,000$ of which $$7,000$ was a capital dividend. $($Election forms were already filed.$)$ Non$-$Eligible dividends of $$10,000$ were also paid to Ms$.$ Clark during the year.

$6.$ For the fiscal year ended December $31,2023,$ SMI made the following expenditures:

Charitable donations not yet deducted $$45,000$

Federal tax instalments $$120,000$

$7.$ Balances in the tax accounts as at the beginning of fiscal $2023$ are as follows:

Charitable donations made in $2022,$ unused in that year $$12,000$

Charitable donations made in $2017,$ unused in that year $4,000$

Refundable dividend tax on hand $($non$-$eligible dividends$)$ $$15,000$

Dividend refund in $2022($non$-$eligible dividends$)$ $$8,000$

Net capital losses realized in $1989,$ unused to date $$25,000$

Capital dividend account $$15,000$

Non capital losses from $2019$ $$3,000$

$8.$ Withholding tax on the non business income in$$ Can $ is $$4,500$

Required:

a$.$ Assume that the current year$$s passive income is equal to the prior year$$s passive income.

Compute the net taxes payable by $($refundable to$)$ Sunday Media Incorporated $($SMI$),$for its $2023$ taxation year making use of all credits, refunds and payments. Show all your calculations. The provincial tax rate is $14$ per cent.

b$.$Compute the Refundable Tax on Hand showing all your work including the dividend refund and$$Part $1$V Tax.