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Yes this is a taxation question but there is no taxation subject section only accounting. Please Solve. ABC Ltd. is a Canadian controlled private corporation
Yes this is a taxation question but there is no taxation subject section only accounting. Please Solve.
ABC Ltd. is a Canadian controlled private corporation with a December 31 year end. For the taxation year ending December 31, 2020, its Net Income For Tax Purposes was made up of the following components $ 514,400 Active Business Income (Note 1) Dividends From Canadian Corporations: Wholly Owned Subsidiary (Note 2) Portfolio Investments (All Eligible Dividends) Canadian Source Interest Taxable Capital Gains Natcome or Tax Purposes 297 400 89,600 44.300 93.100 $1.038.00 Note 1 - As determined under ITR 5200, 5326,000 of this total qualified as M&P profits. As these amounts are allocated to a province which has a special rate for M&P profits, the company calculates the federal M&P deduction Note 2. As a result of paying these dividends, the subsidiary received a dividend refund of $52,800. None of these dividends were designated as eligible. Other Information: 1. ABC Ltd. is part of a group of several associated companies. It has been agreed that ABC Ltd. will be allocated $100,000 of the group's annual business limit for purposes of determining the small business deduction 2. At January 1, 2020, ABC Ltd. had an Eligible RDTOH of $12,000. The Non-Eligible RDTOH balance on this date was nil. 3. At January 1, 2020, ABC Ltd. had a GRIP balance of $126,700. 4. For 2019, ABC and its associated corporations had ADJUSTED Aggregate Investment Income of $47,650. Their Taxable Capital Employed In Canada was $4,652,000 for 2019. 5. On July 1, 2020, ABC Ltd. paid taxable dividends to its shareholders in the amount of $132,400. It is the policy of the corporation to maximize the amount of dividends designated as eligible 6. The Company has available a net capital loss carry forward of $12,000 (1/2)($24,000) and a non-capital loss carry forward of $163,400. It plans to deduct both of these items to the extent possible during 2020. Part 1 For ABC Ltd. 's 2020 taxation year, calculate the following items and show all work: A. Part 1 Tax Payable B. The refundable portion of Part 1 Tax Payable. C. Part IV Tax Payable. D. The balance in the GRIP account on December 31, 2020. E. The balances two RDTOH accounts on December 31, 2020. F. The dividend refund, if any, showing separately the amount related to eligible dividends and the amount related to non-eligible dividends. G. Total federal Tax Payable (net of any dividend refund). Part II A. Complete ABC's T2 B. Aside from schedule 1, list (do not prepare) the schedules ABC would include in its 2020 tax return. ABC Ltd. is a Canadian controlled private corporation with a December 31 year end. For the taxation year ending December 31, 2020, its Net Income For Tax Purposes was made up of the following components $ 514,400 Active Business Income (Note 1) Dividends From Canadian Corporations: Wholly Owned Subsidiary (Note 2) Portfolio Investments (All Eligible Dividends) Canadian Source Interest Taxable Capital Gains Natcome or Tax Purposes 297 400 89,600 44.300 93.100 $1.038.00 Note 1 - As determined under ITR 5200, 5326,000 of this total qualified as M&P profits. As these amounts are allocated to a province which has a special rate for M&P profits, the company calculates the federal M&P deduction Note 2. As a result of paying these dividends, the subsidiary received a dividend refund of $52,800. None of these dividends were designated as eligible. Other Information: 1. ABC Ltd. is part of a group of several associated companies. It has been agreed that ABC Ltd. will be allocated $100,000 of the group's annual business limit for purposes of determining the small business deduction 2. At January 1, 2020, ABC Ltd. had an Eligible RDTOH of $12,000. The Non-Eligible RDTOH balance on this date was nil. 3. At January 1, 2020, ABC Ltd. had a GRIP balance of $126,700. 4. For 2019, ABC and its associated corporations had ADJUSTED Aggregate Investment Income of $47,650. Their Taxable Capital Employed In Canada was $4,652,000 for 2019. 5. On July 1, 2020, ABC Ltd. paid taxable dividends to its shareholders in the amount of $132,400. It is the policy of the corporation to maximize the amount of dividends designated as eligible 6. The Company has available a net capital loss carry forward of $12,000 (1/2)($24,000) and a non-capital loss carry forward of $163,400. It plans to deduct both of these items to the extent possible during 2020. Part 1 For ABC Ltd. 's 2020 taxation year, calculate the following items and show all work: A. Part 1 Tax Payable B. The refundable portion of Part 1 Tax Payable. C. Part IV Tax Payable. D. The balance in the GRIP account on December 31, 2020. E. The balances two RDTOH accounts on December 31, 2020. F. The dividend refund, if any, showing separately the amount related to eligible dividends and the amount related to non-eligible dividends. G. Total federal Tax Payable (net of any dividend refund). Part II A. Complete ABC's T2 B. Aside from schedule 1, list (do not prepare) the schedules ABC would include in its 2020 tax returnStep by Step Solution
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