Question
Wai Yeung is a self-employed insurance Salesperson. She started her business on January 1, 2022, and ended her first taxation year on December 31, 2022.
Wai Yeung is a self-employed insurance Salesperson. She started her business on January 1, 2022, and ended her first taxation year on December 31, 2022. On July 1, she purchased a car for $37,000 plus 13% HST. The car is financed with a bank loan and interest costs amounted to $1,980 from July 1 to December 31. Wai incurred the following additional expenses relating to her automobile:
Repairs and maintenance $ 500
Insurance 1,300
Gasoline 2,100
Parking while on business 600
During the period, Wai drove 20,000 Km, of which 12,000 Km were for business. Assume the car is not designated as immediate expensing property.
Complete the table below to answer the following questions.
a. Determine the maximum amount that Wai can deduct from her business income for tax purposes in 2022. Show expenses as negative numbers.
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