COMPREHENSIVE TAX CASE - CORPORATE TAXATION
Angie's Amazing Getups Inc. is a Canadian controlled private corporation with a head office in Ymir, B.C.. The company is a
manufacturer of high end custom costumes and makeup used in movie and theatre productions with sales in Canada
and the U.S.. It is a BC incorporated company, estalished on January 1, 2020. Angie is a Canadian tax resident and owns
all the common shares (10,000 shares were issued for $1 each)
The company started in business on Jan 1, 2020 when the sole shareholder, Angela Q. Snodgrass, was photographed by the
paparazzi after a particular enthusiastic night of partying. When Angela saw herself on the front pager of every tabloid
newspaper the next day, she knew that fame was not for her. Since Angela was highly skilled in designing clothes and
a makeup artist, she felt she would be able to use those skills to start her own business and keep out of the limelight.
In November, 2020, after discovering that her bookkeeper, Ponzi Madoff, had been defrauding her, Angela fired him
and took over the bookkeeping herself despite having a limited knowledge of accounting. She has produced the following
income statement and miscellaneous financial information for the year ended December 31, 2020 and needs your help.
Please prepare the corporate tax return.
Angie's Amazing Getups Inc.
Income Statement
Year Ending December 31, 2020
Sales
Cost of goods sold
Gross profit
Expenses:
Advertising
Depreciation
Insurance
Interest expenses
Licences, fees & dues
Office expenses
Salaries
Rent
Utilities
Operating income
Other Income:
Loss on disposal of investment
Interest income
Dividends (from CIBC shares)
Income before taxes
Income taxes
Profit
$
(175,000)
(125,000)
(10,000)
(9,000)
(15,000)
(50,000)
(500,000)
(15,000)
(20,000)
6,578,903
(5,068,752)
1,510,151
(919,000)
591,151
$
(17,000)
12,000
10,000
596,151
596,151
Angie's Amazing Getups Inc.
Balance Sheet
December 31, 2020
Cash
Accounts receivable
Corporate tax payable
Plant & equipment
Accumulated depreciation
Investments at cost
$
$
231,151
60,000
20,000
150,000
(125,000)
250,000
586,151
Accounts payable
Loan - bank
Shareholder loan
Common shares
Retained earnings
$
$
20,000
30,000
30,000
10,000
496,151
586,151
(eligible dividends paid of $100,000)
During your review of Angela's work and last year's tax return for the corporation, you have made the following notes:
1.expenses include (buried in various expense accounts):
golf club membership
meals while entertaining clients
costs of meals prepared by personal chef at home
annual summer barbeque for staff
cost to attend costume convention in Hollywood
cost to attend yoga retreat in Bali
2. Interest expense consists of:
interest to bank for loan
interest on late tax payment
4,000
3,000
5,000
1,000
6,000
15,000
5,000
4,000
3. the loss on sale of investments were Royal Bank shares that were purchased for $85,000 on June 15, 2020.
and sold on December 12, 2020.
4. maximum CCA will always been taken on all assets.
5. The Dividends received from CIBC shares were all classified as eligible.
6. she purchased a new costume making machine for $150,000 on April 1, 2020.
7. Angie made tax installments of $5,000 on March 31, June 30, September 30, and December 31.
REQUIRED:
Prepare the 2020 corporate tax return using intuit profile.
For submission - upload the file (not a pdf) to moodle by the due date.
200
Code 1601
Protected B
T2 Corporation Income Tax Return
(2016 and later tax years)
This form serves as a federal, provincial, and territorial corporation income tax return, unless the corporation is located in
Quebec or Alberta. If the corporation is located in one of these provinces, you have to file a separate provincial
corporation return.
All legislative references on this return are to the federal Income Tax Act and Income Tax Regulations. This return may
contain changes that had not yet become law at the time of publication.
Send one completed copy of this return, including schedules and the General Index of Financial Information (GIFI), to your
tax centre or tax services office. You have to file the return within six months after the end of the corporation's tax year.
when completed
055
Do not use this area
For more information see cra.gc.ca or Guide T4012, T2 Corporation – Income Tax Guide.
Identification
Business number (BN) . . . . . . . . . . . . . . . . . . . . . . . . . . .
R C
001
Corporation's name
To which tax year does this return apply?
Tax year start
002
Tax year-end
Year Month Day
Address of head office
Has this address changed since the
last time we were notified? . . . . . . . .
If yes, complete lines 011 to 018.
010
1 Yes
2 No
011
012
Province, territory, or state
City
015
016
Country (other than Canada)
017
Postal or ZIP code
018
Mailing address (if different from head office address)
Has this address changed since the
1 Yes
last time we were notified? . . . . . . . . 020
If yes, complete lines 021 to 028.
021
022
2 No
c/o
023
Province, territory, or state
City
025
026
Country (other than Canada)
027
Postal or ZIP code
028
Location of books and records (if different from head office address)
Has this address changed since the
1 Yes
2 No
last time we were notified? . . . . . . . . 030
If yes, complete lines 031 to 038.
031
032
Province, territory, or state
City
035
036
Country (other than Canada)
037
040
Postal or ZIP code
038
Type of corporation at the end of the tax year (tick one)
1 Canadian-controlled private corporation (CCPC)
Year Month Day
060
061
Has there been an acquisition of control
resulting in the application of
subsection 249(4) since the tax year
start on line 060? . . . . . . . . . . . . . . . . . . .
063
If yes, provide the date control was
acquired . . . . . . . . . . . . . . . . . . . . . . . . . . .
065
Is the date on line 061 a deemed
tax year-end according to
subsection 249(3.1)? . . . . . . . . . . . . . . . .
066
1 Yes
2 No
Is the corporation a professional
corporation that is a member of a
partnership? . . . . . . . . . . . . . . . . . . . . . .
067
1 Yes
2 No
Is this the first year of filing after:
1 Yes
070
Incorporation? . . . . . . . . . . . . . . . . . . . .
1 Yes
071
Amalgamation? . . . . . . . . . . . . . . . . . . . .
If yes, complete lines 030 to 038 and attach Schedule 24.
2 No
2 No
Has there been a wind-up of a
subsidiary under section 88 during the
current tax year? . . . . . . . . . . . . . . . . . .
If yes, complete and attach Schedule 24.
072
1 Yes
2 No
Is this the final tax year before
amalgamation? . . . . . . . . . . . . . . . . . . . .
076
1 Yes
2 No
Is this the final return up to
dissolution? . . . . . . . . . . . . . . . . . . . . . . .
078
1 Yes
2 No
If an election was made under section 261, state
the functional currency used . . . . . . . . . . . . . .
079
1 Yes
2 No
Year Month Day
1 Yes
2 No
080
If no, give the country of residence on line 081 and complete and attach
Schedule 97.
Is the corporation a resident of Canada?
081
Is the non-resident corporation claiming
an exemption under an income tax
treaty? . . . . . . . . . . . . . . . . . . . . . . . . . . .
If yes, complete and attach Schedule 91.
082
1 Yes
2 No
2 Other private corporation
If the corporation is exempt from tax under section 149, tick one of the
following boxes:
3 Public corporation
4 Corporation controlled by a public corporation
085
5 Other corporation (specify)
If the type of corporation changed
during the tax year, provide the
effective date of the change . . . . . .
1 Exempt under paragraph 149(1)(e) or (l)
2 Exempt under paragraph 149(1)(j)
3 Exempt under paragraph 149(1)(t)
4 Exempt under other paragraphs of section 149
Year Month Day
043
Do not use this area
095
T2 E (16)
096
898
(Vous pouvez obtenir ce formulaire en français à arc.gc.ca/formulaires ou en composant le 1-800-959-7775.)
Page 1 of 9
Attachments
Protected B when completed
Financial statement information: Use GIFI schedules 100, 125, and 141.
Schedules – Answer the following questions. For each yes response, attach the schedule to the T2 return, unless otherwise instructed.
Yes Schedule
Is the corporation related to any other corporations? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation an associated CCPC? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation an associated CCPC that is claiming the expenditure limit? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
150
160
161
9
23
49
Does the corporation have any non-resident shareholders who own voting shares? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
151
19
Has the corporation had any transactions, including section 85 transfers, with its shareholders, officers, or employees,
other than transactions in the ordinary course of business? Exclude non-arm's length transactions with non-residents . . . . . . . . . . .
162
11
If you answered yes to the above question, and the transaction was between corporations not dealing at arm's length,
were all or substantially all of the assets of the transferor disposed of to the transferee? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Has the corporation paid any royalties, management fees, or other similar payments to residents of Canada? . . . . . . . . . . . . . . . . . .
163
164
44
14
Is the corporation claiming a deduction for payments to a type of employee benefit plan? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation claiming a loss or deduction from a tax shelter? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation a member of a partnership for which a partnership account number has been assigned? . . . . . . . . . . . . . . . . . . . .
165
166
167
15
T5004
T5013
Did the corporation, a foreign affiliate controlled by the corporation, or any other corporation or trust that did not deal at arm's length
with the corporation have a beneficial interest in a non-resident discretionary trust (without reference to section 94)? . . . . . . . . . . . .
Did the corporation own any shares in one or more foreign affiliates in the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
168
169
22
Has the corporation made any payments to non-residents of Canada under subsections 202(1) and/or 105(1) of
the Income Tax Regulations? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Did the corporation have a total amount over $1 million of reportable transactions with non-arm's length non-residents? . . . . . . . . . .
170
171
29
T106
For private corporations: Does the corporation have any shareholders who own 10% or more of the corporation's common
and/or preferred shares? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Has the corporation made payments to, or received amounts from, a retirement compensation plan arrangement during the year?
Does the corporation earn income from one or more Internet webpages or websites? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the net income/loss shown on the financial statements different from the net income/loss for income tax purposes? . . . . . . . . . . .
173
172
180
50
201
1
Has the corporation made any charitable donations; gifts of cultural or ecological property; or gifts of medicine? . . . . . . . . . . . . . . . .
Has the corporation received any dividends or paid any taxable dividends for purposes of the dividend refund? . . . . . . . . . . . . . . . .
Is the corporation claiming any type of losses? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
202
203
204
2
3
4
Is the corporation claiming a provincial or territorial tax credit or does it have a
permanent establishment in more than one jurisdiction? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Has the corporation realized any capital gains or incurred any capital losses during the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . .
205
206
5
6
207
7
i) Is the corporation claiming the small business deduction and reporting a) income or loss from property (other than dividends
deductible on line 320 of the T2 return), b) income from a partnership, c) income from a foreign business, d) income from a
personal services business, e) income referred to in clause 125(1)(a)(i)(C) or 125(1)(a)(i)(B), or f) business limit assigned under
subsection 125(3.2); or
ii) does the corporation have aggregate investment income at line 440? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Does the corporation have any property that is eligible for capital cost allowance? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25
88
208
8
Does the corporation have any property that is eligible capital property? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Does the corporation have any resource-related deductions? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation claiming deductible reserves (other than transitional reserves under section 34.2)? . . . . . . . . . . . . . . . . . . . . . . . .
210
212
213
10
12
13
Is the corporation claiming a patronage dividend deduction? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation a credit union claiming a deduction for allocations in proportion to borrowing or an additional deduction? . . . . . . .
Is the corporation an investment corporation or a mutual fund corporation? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
216
217
218
16
17
18
Is the corporation carrying on business in Canada as a non-resident corporation? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation claiming any federal, provincial, or territorial foreign tax credits, or any federal logging tax credits? . . . . . . . . . . . .
Does the corporation have any Canadian manufacturing and processing profits? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
220
221
227
20
21
27
Is the corporation claiming an investment tax credit? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation claiming any scientific research and experimental development (SR&ED) expenditures? . . . . . . . . . . . . . . . . . . . .
Is the total taxable capital employed in Canada of the corporation and its related corporations over $10,000,000? . . . . . . . . . . . . . . .
231
232
233
31
T661
33/34/35
Is the total taxable capital employed in Canada of the corporation and its associated corporations over $10,000,000? . . . . . . . . . . . .
Is the corporation subject to gross Part VI tax on capital of financial institutions? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
234
238
38
Is the corporation claiming a Part I tax credit? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation subject to Part IV.1 tax on dividends received on taxable preferred shares or Part VI.1 tax on dividends paid? . . .
Is the corporation agreeing to a transfer of the liability for Part VI.1 tax? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
242
243
244
42
43
45
Is the corporation subject to Part II – Tobacco Manufacturers' surtax? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
249
46
250
253
254
255
39
T1131
T1177
92
For financial institutions: Is the corporation a member of a related group of financial institutions
with one or more members subject to gross Part VI tax? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation claiming a Canadian film or video production tax credit refund? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation claiming a film or video production services tax credit refund? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Is the corporation subject to Part XIII.1 tax? (Show your calculations on a sheet that you identify as Schedule 92.) . . . . . . . . . . . . . .
Page 2
Protected B when completed
Attachments (continued)
Did the corporation have any foreign affiliates in the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
271
T1134
Did the corporation own or hold specified foreign property where the total cost amount of all such property, at any time in the year,
was more than CAN$100,000? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Did the corporation transfer or loan property to a non-resident trust? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Did the corporation receive a distribution from or was it indebted to a non-resident trust in the year? . . . . . . . . . . . . . . . . . . . . . . . . .
259
260
261
T1135
T1141
T1142
Has the corporation entered into an agreement to allocate assistance for SR&ED carried out in Canada? . . . . . . . . . . . . . . . . . . . . .
Has the corporation entered into an agreement to transfer qualified expenditures incurred in respect of SR&ED contracts? . . . . . . .
262
263
T1145
T1146
Has the corporation entered into an agreement with other associated corporations for salary or wages of
specified employees for SR&ED? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Did the corporation pay taxable dividends (other than capital gains dividends) in the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Has the corporation made an election under subsection 89(11) not to be a CCPC? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
264
265
266
T1174
55
T2002
Has the corporation revoked any previous election made under subsection 89(11)? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
267
T2002
Did the corporation (CCPC or deposit insurance corporation (DIC)) pay eligible dividends, or did its
general rate income pool (GRIP) change in the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
268
53
Did the corporation (other than a CCPC or DIC) pay eligible dividends, or did its low rate income pool (LRIP)
change in the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
269
54
Additional information
Did the corporation use the International Financial Reporting Standards (IFRS) when it prepared its financial statements?
Is the corporation inactive? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Specify the principal products mined, manufactured,
sold, constructed, or services provided, giving the
approximate percentage of the total revenue that
each product or service represents.
270
280
1 Yes
2 No
1 Yes
2 No
284
286
285
287
%
%
288
289
%
Did the corporation immigrate to Canada during the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Did the corporation emigrate from Canada during the tax year? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Do you want to be considered as a quarterly instalment remitter if you are eligible? . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
291
292
293
If the corporation was eligible to remit instalments on a quarterly basis for part of the tax year, provide the date the
corporation ceased to be eligible . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
294
If the corporation's major business activity is construction, did you have any subcontractors during the tax year? . . . . . .
295
1 Yes
1 Yes
1 Yes
2 No
2 No
2 No
Year Month Day
1 Yes
2 No
Taxable income
300
A
Ź
Subtotal
Subtotal (amount A minus amount B) (if negative, enter "0")
B
355
360
D
Net income or (loss) for income tax purposes from Schedule 1, financial statements, or GIFI . . . . . . . . . . . . . . . . . . . . . . . . . .
Deduct:
Charitable donations from Schedule 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
311
Cultural gifts from Schedule 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ecological gifts from Schedule 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
313
314
Gifts of medicine from Schedule 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxable dividends deductible under section 112 or 113, or subsection 138(6)
from Schedule 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
315
Part VI.1 tax deduction* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-capital losses of previous tax years from Schedule 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net capital losses of previous tax years from Schedule 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Restricted farm losses of previous tax years from Schedule 4 . . . . . . . . . . . . . . . . . . . . . . . . .
Farm losses of previous tax years from Schedule 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Limited partnership losses of previous tax years from Schedule 4 . . . . . . . . . . . . . . . . . . . . . .
Taxable capital gains or taxable dividends allocated from a central credit union . . . . . . . . . . .
Prospector's and grubstaker's shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
320
325
331
332
333
334
335
340
350
Section 110.5 additions or subparagraph 115(1)(a)(vii) additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxable income (amount C plus amount D) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
370
Income exempt under paragraph 149(1)(t) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxable income for a corporation with exempt income under paragraph 149(1)(t) (line 360 minus line 370) . . . . . . . . . . . . . . . . . .
C
Z
* This amount is equal to 3.5 times the Part VI.1 tax payable at line 724 on page 9.
Page 3
Protected B when completed
Small business deduction
Canadian-controlled private corporations (CCPCs) throughout the tax year
Income from active business carried on in Canada from Schedule 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxable income from line 360 on page 3, minus 100/28 of the amount on line 632* on page 8, minus 4 times the amount on
line 636** on page 8, and minus any amount that, because of federal law, is exempt from Part I tax . . . . . . . . . . . . . . . . . . .
Business limit (see notes 1 and 2 below) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes:
400
A
405
410
B
C
1. For CCPCs that are not associated, enter $500,000 on line 410. However, if the corporation's tax year is less than 51 weeks,
prorate this amount by the number of days in the tax year divided by 365, and enter the result on line 410.
2. For associated CCPCs, use Schedule 23 to calculate the amount to be entered on line 410.
Business limit reduction:
×
Amount C
415 ***
D
=
E
..........................................
11,250
Reduced business limit (amount C minus amount E) (if negative, enter "0") . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F
425
G
Business limit the CCPC assigns under subsection 125(3.2) (from line 515 below) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
427
H
=
1
× 17.5% =
Number of days in the tax year
Total of amounts 1 and 2 (enter amount I on line J on page 8) 430
2
Amount F minus amount G . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Small business deduction
Amount A, B, C, or H,
whichever is the least
×
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
Amount A, B, C, or H,
whichever is the least
×
Number of days in the tax year
after December 31, 2015
×
17%
I
*
Calculate the amount of foreign non-business income tax credit deductible on line 632 without reference to the refundable tax on the CCPC's investment
income (line 604) and without reference to the corporate tax reductions under section 123.4.
** Calculate the amount of foreign business income tax credit deductible on line 636 without reference to the corporation tax reductions under section 123.4.
*** Large corporations
• If the corporation is not associated with any corporations in both the current and previous tax years, the amount to be entered on line 415 is: (total
taxable capital employed in Canada for the prior year minus $10,000,000) x 0.225%.
• If the corporation is not associated with any corporations in the current tax year, but was associated in the previous tax year, the amount to be entered
on line 415 is: (total taxable capital employed in Canada for the current year minus $10,000,000) x 0.225%.
• For corporations associated in the current tax year, see Schedule 23 for the special rules that apply.
Specified corporate income and assignment under subsection 125(3.2)
Applicable to tax years that begin after March 21, 2016
Except that, if the tax year of your corporation started before and ends on or after March 22, 2016 and in the tax year of a CCPC, you can make an
assignment of business limit to that other CCPC if its tax year started after March 21, 2016.
J
Business number of
the corporation
receiving the
assigned amount
K
Income paid under
clause 125(1)(a)(i)(B) to the
corporation identified in
column J 3
L
Business limit assigned to
corporation identified in
column J 4
490
500
505
1.
2.
3.
4.
Total 515
Total 510
Notes:
3. This amount is [as defined in subsection 125(7) specified corporate income (a)(i)] the total of all amounts each of which is income from an active
business of the corporation for the year from the provision of services or property to a private corporation (directly or indirectly, in any manner
whatever) if
(A) at any time in the year, the corporation (or one of its shareholders) or a person who does not deal at arm's length with the corporation (or one of its
shareholders) holds a direct or indirect interest in the private corporation, and
(B) it is not the case that all or substantially all of the corporation's income for the year from an active business is from the provision of services or
property to
(I) persons (other than the private corporation) with which the corporation deals at arm's length, or
(II) partnerships with which the corporation deals at arm's length, other than a partnership in which a person that does not deal at arm's length
with the corporation holds a direct or indirect interest.
4. The amount of the business limit you assign to a CCPC cannot be greater than the amount determined by the formula A – B, where A is the amount of
income referred to in column K in respect of that CCPC and B is the portion of the amount described in A that is deductible by you in respect of the
amount of income referred to in clauses 125(1)(a)(i)(A) or (B) for the year. The amount on line 515 cannot be greater than the amount on line 425.
Page 4
Protected B when completed
General tax reduction for Canadian-controlled private corporations
Canadian-controlled private corporations throughout the tax year
Taxable income from page 3 (line 360 or amount Z, whichever applies) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lesser of amounts B9 and H9 from Part 9 of Schedule 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount K13 from Part 13 of Schedule 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Personal services business income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 432
B
C
Amount used to calculate the credit union deduction (amount F from Schedule 17) . . . . . . . . . . . .
Amount from line 400, 405, 410, or 427 on page 4, whichever is the least . . . . . . . . . . . . . . . . . . .
D
E
F
Aggregate investment income from line 440 on page 6* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
G
Subtotal (add amounts B to G)
A
Ź
H
Amount A minus amount H (if negative, enter "0") . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
I
General tax reduction for Canadian-controlled private corporations – Amount I multiplied by 13% . . . . . . . . . . . . . . . . . . . . . .
Enter amount J on line 638 on page 8.
J
* Except for a corporation that is, throughout the year, a cooperative corporation (within the meaning assigned by subsection 136(2)) or a credit union.
General tax reduction
Do not complete this area if you are a Canadian-controlled private corporation, an investment corporation, a mortgage investment corporation, a
mutual fund corporation, or any corporation with taxable income that is not subject to the corporation tax rate of 38%.
Taxable income from page 3 (line 360 or amount Z, whichever applies) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lesser of amounts B9 and H9 from Part 9 of Schedule 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount K13 from Part 13 of Schedule 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Personal services business income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 434
L
M
N
Amount used to calculate the credit union deduction (amount F from Schedule 17) . . . . . . . . . . . .
O
Subtotal (add amounts L to O)
Ź
K
P
Amount K minus amount P (if negative, enter "0") . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Q
General tax reduction – Amount Q multiplied by 13% . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Enter amount R on line 639 on page 8.
R
Page 5
Protected B when completed
Refundable portion of Part I tax
Canadian-controlled private corporations throughout the tax year
Aggregate investment income from Schedule 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
440
A
Amount A
×
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
×
26 2/3%
=
1
Amount A
×
Number of days in the tax year
after December 31, 2015
×
30 2/3%
=
2
Number of days in the tax year
Subtotal (amount 1 plus amount 2)
Ź
445
C
Foreign investment income from Schedule 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount C
×
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
×
9 1/3%
=
3
Amount C
×
Number of days in the tax year
after December 31, 2015
×
8%
=
4
B
Number of days in the tax year
Subtotal (amount 3 plus amount 4)
D
Foreign non-business income tax credit from line 632 on page 8 minus amount D (if negative, enter "0") . . . . . . . . . . . . . . . . . . . . . .
E
Amount B minus amount E (if negative, enter "0") . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F
Foreign non-business income tax credit from line 632 on page 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
G
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
×
35
=
.........................
5
Number of days in the tax year
after December 31, 2015
×
38 2/3
=
.........................
6
Number of days in the tax year
Subtotal (amount 5 plus amount 6)
×
=
100
................
H
Taxable income from line 360 on page 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount G
H
I
J
Deduct:
Amount from line 400, 405, 410, or 427 on page 4, whichever is the least . . .
K
Amount I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
L
Foreign business income tax
credit from line 636 on page 8
×
4
=
M
...........
Ź
Subtotal (total of amounts K to M)
Subtotal (amount J minus amount N)
N
O
Amount O
×
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
×
26 2/3%
=
7
Amount O
×
Number of days in the tax year
after December 31, 2015
×
30 2/3%
=
8
Number of days in the tax year
Subtotal (amount 7 plus amount 8)
Ź
P
Part I tax payable minus investment tax credit refund (line 700 minus line 780 from page 9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Q
450
R
Refundable portion of Part I tax – Amount F, P, or Q, whichever is the least . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Page 6
Protected B when completed
Refundable dividend tax on hand
Refundable dividend tax on hand at the end of the previous tax year . . . . . . . . . . . . . . . . . .
460
Deduct:
Dividend refund for the previous tax year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
465
Ź
A
Add:
Refundable portion of Part I tax from line 450 on page 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
B
Total Part IV tax payable from Schedule 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net refundable dividend tax on hand transferred from a predecessor corporation on
amalgamation, or from a wound-up subsidiary corporation . . . . . . . . . . . . . . . . . . . . . . 480
C
Subtotal (add amounts B, C, and line 480)
Ź
Refundable dividend tax on hand at the end of the tax year – Amount A plus amount D . . . . . . . . . . . . . . . . . . . . . . . . .
D
485
Dividend refund
Private and subject corporations at the time taxable dividends were paid in the tax year
Taxable dividends paid in the tax year from line 460 on page 3 of Schedule 3 . . . . . . . . . . . . . .
E
Amount E
×
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
×
33 1/3% =
1
Amount E
×
Number of days in the tax year
after December 31, 2015
×
38 1/3% =
2
Number of days in the tax year
Subtotal (amount 1 plus amount 2)
Ź
F
Refundable dividend tax on hand at the end of the tax year from line 485 above . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
G
Dividend refund – Amount F or G, whichever is less . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
H
Enter amount H on line 784 on page 9.
Page 7
Protected B when completed
Part I tax
Base amount Part I tax – Taxable income from page 3 (line 360 or amount Z, whichever applies) multiplied by 38% . . . . . .
550
A
Additional tax on personal services business income (section 123.5)
Number of days in the tax year
Taxable income from a personal
×
after December 31, 2015
555
services business . . . . . . . . . .
=
560
B
Recapture of investment tax credit from Schedule 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
602
C
×
5%
Number of days in the tax year
Calculation for the refundable tax on the Canadian-controlled private corporation's (CCPC) investment income
(if it was a CCPC throughout the tax year)
D
Aggregate investment income from line 440 on page 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
E
Taxable income from line 360 on page 3 . . . . . . . . . . . . . . . . . . . . .
Deduct:
Amount from line 400, 405, 410, or 427 on page 4, whichever
is the least . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F
Ź
Net amount (amount E minus amount F)
G
Amount D or G,
whichever is less
×
Number of days in the tax year
before January 1, 2016
Number of days in the tax year
×
=
1
Amount D or G,
whichever is less
×
Number of days in the tax year
after December 31, 2015
× 10 2/3% =
2
6 2/3%
Number of days in the tax year
Refundable tax on CCPC's investment income (amount 1 plus amount 2) . . . . . . . . . . . . . . .
Ź
604
Subtotal (add amounts A, B, C, and H)
H
I
Deduct:
Small business deduction from line 430 on page 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal tax abatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 608
Manufacturing and processing profits deduction from Schedule 27 . . . . . . . . . . . . . . . . . . . . . 616
Investment corporation deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 620
Taxed capital gains
J
624
Additional deduction – credit unions from Schedule 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal foreign non-business income tax credit from Schedule 21 . . . . . . . . . . . . . . . . . . . . . .
628
Federal foreign business income tax credit from Schedule 21 . . . . . . . . . . . . . . . . . . . . . . . . .
General tax reduction for CCPCs from amount J on page 5 . . . . . . . . . . . . . . . . . . . . . . . . . . .
632
636
638
General tax reduction from amount R on page 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal logging tax credit from Schedule 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Eligible Canadian bank deduction under section 125.21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
639
640
641
Federal qualifying environmental trust tax credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment tax credit from Schedule 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
648
652
Subtotal
Ź
Part I tax payable – Amount I minus amount K . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Enter amount L on line 700 on page 9.
K
L
Privacy statement
Personal information is collected under the Income Tax Act to administer tax, benefits, and related programs. It may also be used for any purpose related to
the administration or enforcement of the Act such as audit, compliance and the payment of debts owed to the Crown. It may be shared or verified with other
federal, provincial/territorial government institutions to the extent authorized by law. Failure to provide this information may result in interest payable, penalties
or other actions. Under the Privacy Act, individuals have the right to access their personal information and request correction if there are errors or omissions.
Refer to Info Source cra.gc.ca/gncy/tp/nfsrc/nfsrc-eng.html, personal information bank CRA PPU 047.
Page 8
Protected B when completed
Summary of tax and credits
Federal tax
Part I tax payable from amount L on page 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part II surtax payable from Schedule 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part III.1 tax payable from Schedule 55 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part IV tax payable from Schedule 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part IV.1 tax payable from Schedule 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
700
708
710
712
716
Part VI tax payable from Schedule 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part VI.1 tax payable from Schedule 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
720
724
Part XIII.1 tax payable from Schedule 92 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
727
728
Part XIV tax payable from Schedule 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total federal tax
Add provincial or territorial tax:
750
Provincial or territorial jurisdiction . . . . . . . . . . . . . . . . .
(if more than one jurisdiction, enter "multiple" and complete Schedule 5)
Net provincial or territorial tax payable (except Quebec and Alberta) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total tax payable
Deduct other credits:
Investment tax credit refund from Schedule 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 780
Dividend refund from amount H on page 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal capital gains refund from Schedule 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
784
788
Federal qualifying environmental trust tax credit refund . . . . . . . . . . . . . . . . . . . . . . . . . . .
Canadian film or video production tax credit refund (Form T1131) . . . . . . . . . . . . . . . . . . .
792
796
Film or video production services tax credit refund (Form T1177) . . . . . . . . . . . . . . . . . . .
Tax withheld at source . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
797
800
801
Total payments on which tax has been withheld . . . . .
Provincial and territorial capital gains refund from Schedule 18 . . . . . . . . . . . . . . . . . . . . .
808
Provincial and territorial refundable tax credits from Schedule 5 . . . . . . . . . . . . . . . . . . . .
Tax instalments paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total credits
760
A
770
812
840
Ź
890
B
Balance (amount A minus amount B)
Refund code
894
Ż
Overpayment
Direct deposit request
To have the corporation's refund deposited directly into the corporation's bank
account at a financial institution in Canada, or to change banking information you
already gave us, complete the information below:
Start
Change information
910
Branch number
914
918
Institution number
Account number
If the result is positive, you have a balance unpaid.
If the result is negative, you have an overpayment.
Enter the amount on whichever line applies.
Generally, we do not charge or refund a difference of
$2 or less.
Ż
Balance unpaid . . . . . . . . . .
For information on how to make your payment, go to
cra.gc.ca/payments.
If the corporation is a Canadian-controlled private corporation throughout the tax year, does it qualify for the
one-month extension of the date the balance of tax is due? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1 Yes
896
If this return was prepared by a tax preparer for a fee, provide their EFILE number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2 No
920
Certification
I, 950
951
Last name
,
954
First name
Position, office, or rank
am an authorized signing officer of the corporation. I certify that I have examined this return, including accompanying schedules and statements, and that
the information given on this return is, to the best of my knowledge, correct and complete. I also certify that the method of calculating income for this tax
year is consistent with that of the previous tax year except as specifically disclosed in a statement attached to this return.
955
956
Date (yyyy/mm/dd)
Signature of the authorized signing officer of the corporation
Is the contact person the same as the authorized signing officer? If no, complete the information below . . . . . . . . . .
958
Telephone number
957
1 Yes
2 No
959
Name of other authorized person
Telephone number
Language of correspondence – Langue de correspondance
Indicate your language of correspondence by entering 1 for English or 2 for French.
Indiquez votre langue de correspondance en inscrivant 1 pour anglais ou 2 pour français.
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