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Detailed Description
Through assigned readings, lectures and class discussion,
demonstration, and individual and group activities, students apply
selected provisions of the Income Tax Act to corporate taxpayers. The
filing and tax payment deadlines for Canadian corporations are
compared and any necessary installment payment obligations are
calculated. The relationship between generally accepted accounting
principles and the rules for determining business income are examined
to determine which items are permitted for tax purposes and to
calculate income from a business for tax purposes. The tax
consequences of the acquisition, use and disposal of depreciable
property and eligible capital property are examined and the optimal
capital cost allowance claim is generated. The framework for
calculating net income for tax purposes is developed. Utilizing this
framework, students analyze the deductions available to a corporation
to reduce net income for tax purposes to taxable income and compare
how the deductions differ to those available to individuals. The
students generate a typical tax return for a public company and a
Canadian-controlled private corporation. The tax treatment of
capitalization by share equity or a combination of equity and debt
are examined and evaluated. Throughout the course, the students
assess the potential for tax planning opportunities from operating a
business or holding investments through a corporation.
Program Context
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| Accounting in Canada |
Program Coordinator: Sally Mitzel |
This course is offered in the
final semester and requires
the students to apply their
knowledge of accounting,
personal tax and accounting
law acquired in the previous
semesters, as the basis for
understanding the provisions
of the Income Tax Act in the
corporate setting.
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Course Critical Performance and Learning Outcomes
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Critical Performance
By the end of this course, students will have demonstrated the
ability to:
Prepare a Canadian corporate income tax return and related filing and
payment obligations in accordance with Canadian legal requirements.
Learning Outcomes
To achieve the critical performance, students will have demonstrated
the ability to:
1. Identify the filing requirements for Canadian corporations.
2. Calculate installment payment obligations for Canadian
corporations.
3. Apply the general rules and exceptions to determine business
income according to the Income Tax Act.
4. Categorize assets into the appropriate classes and calculate the
appropriate capital cost allowance claim.
5. Calculate net income for tax purposes and taxable income for a
Canadian corporation.
6. Explain the relationship between the corporation and its
shareholders and how the Canadian income tax system attempts to
achieve integration of personal and corporate income taxes.
7. Calculate taxes payable for a public company and a Canadian
Controlled Private Corporation (CCPC).
8. Evaluate the tax consequences of corporate capitalization by
shareholder debt or share capital.
9. Assess the tax benefits of incorporating a business.
10. Assess the potential for tax planning opportunities from
operating a business or holding investments through a
corporation.
11. Incorporate appropriate ethical standards in professional
activities by ensuring compliance with the Income Tax Act.
12. Communicate professionally and effectively in both oral and
written form.
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Evaluation Plan
Students demonstrate their learning in the following ways:
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Midterm Test 30%
Final Test 25%
Research project: 5 Modules include written (20%)
and presentation (5%) components 25%
T2 tax returns (Prepared in class in test
setting) 20%
Total 100%
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Some details of this outline may change as a result of circumstances such as weather cancellations, College and student activities, and class timetabling.
Effective term: Spring/Summer 2009
Professor: Tba
Textbook(s): Canadian Income Taxation Planning and Decision Making, by Buckwold
and Kitunen, McGraw-Hill Ryerson Publishers, 2009-2010 edition.
(Students will continue to use this text from the Canadian Personal
Tax course)
Applicable student group(s): Accounting in Canada for Internationally Trained Accountants
Course Details:Week Topic Resources Evaluation
1(a) Introduction to course Text:Chapter 3
Formation of groups Text:Chapter 5
Filing requirements for Canada Revenue
Canadian corporations. Agency(CRA):
(LO 1,11) www.cra.gc.ca
Installment payment Publisher Online
obligations for Canadian Learning Centre:
corporations.(LO 2,11) www.mcgrawhill.ca
/olc/buckwold
Tax planning considerations Lecture materials
(LO 10) In-class exercises
Determining business income:
(LO 3, 11)
-Definition of business income
-GAAP
1(b) Determining business income: Text:Chapter 5
(LO 3, 11) www.cra.gc.ca
-6 general limitations www.mcgrawhill.ca/
to deduction of expenses olc/buckwold
-Exceptions to the Lecture materials
general rules In-class exercises
2(a) Determining business income: Text:Chapter 5 Research
(LO 3,10,11) Text:Chapter 6 Project:
-Inventories www.cra.gc.ca Module
-Scientific research www.mcgrawhill.ca/ 1 due
-Reserves olc/buckwold (4%)
-Unpaid remuneration Lecture materials
-Tax planning In-class exercises
considerations
Capital cost allowance:
(LO 4,11)
-depreciation vs. CCA system
-common classes and CCA rates
-pooling of assets
2(b) Capital cost allowance: Text:Chapter 6
(LO 4,11)
-declining balance method www.cra.gc.ca
-calculation of CCA www.mcgrawhill.ca/
and UCC olc/buckwold
-acquisitions and Lecture materials
disposals In-class exercises
-gains and losses
-terminal losses and recapture
-special treatment of certain
assets
-exceptions to declining
balance method
3(a) Capital cost allowance: Text:Chapter 6 Research
(LO 4, 10, 11) www.cra.gc.ca Project:
-eligible capital property www.mcgrawhill.ca/ Module
-using prescribed forms olc/buckwold 2 due
-tax planning considerations Lecture materials (4%)
In-class exercises
3(b) Presentations for Research
Project:Module 1
(LO 1,2,10,11,12)
Net income for tax purposes Text:Chapter 9 Presentations
(LO 5, 10, 11) Text:Chapter 11 for
-the aggregating formula www.cra.gc.ca Research
-reconciling accounting www.mcgrawhill.ca Project:
income to net income for /olc/buckwold Module 1
tax purposes Lecture materials due for
-using prescribed forms In-class designated
-tax planning considerations exercises groups (5%)
4(a) Presentations for Research 1.Research
Project: Module 2 Project:
(LO 3,10,11,12) Module 3
due (4%)
Taxable income (LO 5,10,11) Text:Chapter 11 2.Presentations
-Donations www.cra.gc.ca for
-Losses www.mcgrawhill.ca Research
-Dividends /olc/buckwold Project:
-Tax planning considerations Lecture materials Module 2
-using prescribed forms In-class due for
exercises designated
groups (5%)
Review for Mid-term test
4(b) MID-TERM TEST (30%) MID-TERM
Chapters 3,5&6 TEST(30%)
(LO 1,2,3,4,10,11,12)
5(a) Relationship between the Text:Chapter 11 Research
corporation and its www.cra.gc.ca Project:
shareholders (LO 6,10,11) www.mcgrawhill.ca Module
-Integration of personal /olc/buckwold 4 due(4%)
and corporate income Lecture materials
taxes In-class exercises
-Tax planning
considerations
Calculation of corporate
tax (LO 7, 11)
-Federal tax
-Federal tax abatement
-General rate reduction
-Manufacturing and
processing deduction
-Provincial tax
-Combined federal and
provincial taxes
5(b) Calculation of corporate Text:Chapter 13
tax (LO 7,10,11) www.cra.gc.ca
-Small business deduction www.mcgrawhill.ca
-Special refundable tax /olc/buckwold
-Part IV tax Lecture materials
-Dividend refund In-class exercises
-Tax planning considerations
-Practice preparation of
T2 Tax returns
6(a) Practice preparation of Research
T2 Tax returns Project:
(LO 7,11) Module 5
due (4%)
Corporate capitalization Text: Chapter 12
by shareholder www.cra.gc.ca
(LO 8, 10,11) www.mcgrawhill.ca
-shareholder debt /olc/buckwold
-share capital Lecture materials
-tax planning considerations In-class exercises
6(b) Tax benefits of incorporating Text: Chapter 13 T2 TAX
a business (LO 9,10,11) www.cra.gc.ca RETURN
-access to the small business www.mcgrawhill.ca TEST
deduction /olc/buckwold (20%)
-other advantages Lecture materials
-disadvantage In-class exercises
-tax planning considerations
T2 TAX RETURN TEST (20%)
(LO 7,11)
7(a) Presentations for Presentations
Research Project : for
Modules 3, 4 & 5 Research
(LO 4,5,7,10,11&12) Project:
Modules
Review for Final test 3,4,& 5
due for
designated
groups (5%)
7(b) FINAL TEST Chapters FINAL TEST
9,11,12,13 (25%)
(LO 5,6,7,8,9,
10,11,12)
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