Course Name (short): Taxation
School: Business
Program(s): Bach Bus Admin Market Manage, Bach Business Admin Accounting, Bach Business Admin Finance, Bach Human Resources, BachBus Admin Spply Chain Mgmt
Program Coordinator(s): Tba
Course Leader or Contact: Tba
Originator: Jessica MacDougall
Designate: Jessica MacDougall
Version: 1.01
Status: Inactive (INAC)

Calendar Description
Students examine Canadian federal income tax legislation to determine income and taxes payable for individuals. Related rules from the Goods and Services Act are also reviewed. Students develop the techniques and skills required to apply this tax knowledge to various situations. Topics include liability for tax; income from employment, business, property, other income and capital gains; taxable income, taxes payable; and the rights and obligations of taxpayers.

Typical Instructional Format

Courses may be offered in other formats.

Section I Notes: This course will be delivered in hybrid format.

Detailed Description
Students examine Canadian federal income tax legislation to determine income and taxes payable for individuals. Related rules from the Goods and Services Act are also reviewed. Students develop the techniques and skills required to apply this tax knowledge to various situations. Topics include liability for tax; income from employment, business, property, other income and capital gains; taxable income, taxes payable; and the rights and obligations of taxpayers. By comparing and analyzing common layout and structure of the Income Tax Act and identifying and distinguishing the exceptions, the student develops a strong framework for making tax related decisions. Through a combination of interactive lectures, class discussions, in-class exercises, numerous situational examples, case studies, research and assignments, students analyze individual circumstances and determine the applicable legislation. Students predict the tax consequences of events and propose alternative courses of action which will result in a more desirable tax treatment.

Program Context

 Critical Performance
By the end of this course, students will have demonstrated the ability
to analyze the tax implications of various situations, using the
Income Tax Act and other Canadian reference materials.

Learning Outcomes
To achieve the critical performance, students will have demonstrated
the ability to:

1.  Determine the residency tax status of an individual and the 
    resulting potential liability for federal income tax.
2.  Distinguish between business income, property income and capital 
    gains.
3.  Specify the tax treatment of income and expenses from various 
    sources.
4.  Prepare a capital cost allowance and eligible capital property 
    schedule according to the capital cost allowance regulations.
5.  Interpret compliance regulations in order to minimize a 
    taxpayer's exposure to interest and penalties.
6.  Specify the tax treatment of the disposition of various types of 
    capital property.  
7.  Calculate net income for tax purposes (Division B income).
8.  Compute taxable income utilizing deductions from net income for 
    tax purposes.
9.  Optimize the use of personal tax credits when determining federal 
    tax payable.
10. Assess the tax implications of various types of income in order 
    to maximize an individual's goals.
11. Formulate recommendations using sound research from the Income 
    Tax Act and Bulletins, Circulars and Rulings from Canada Revenue 
    Agency.
12. Demonstrate professional behaviours including:
    a. work effectively in a team environment.
    b. meet due dates.
    c. prepare professional quality assignments.
    d. use reference materials responsibly

Students demonstrate their learning in the following ways:

Research Assignment 1	        10%
Midterm Exam	                20%
Research Assignment 2 (Group)	15%
Final Comprehensive Exam	40%
In-Class Activities (5 x 3%)	15%
Total	                       100%

In addition to achieving a minimum 50% overall grade, a student must
have a combined average of at least 50% on the non-group components of
the evaluation plan in order to receive credit for this course.

Beam, R.E., Laiken, S.N., Barnett, J.J. (2013 - 2014). Introduction to
Federal Income Taxation in Canada, 35th Edition. CCH Canadian Limited:
Toronto.

Canadian Income Tax Act with Regulations, 98th Edition, 2014. CCH
Canadian Limited: Toronto.

Recommended Reading:
Bulletins, Circulars and Rulings at http://www.cra-arc.gc.ca/

Description:

Module 1: General concepts and principles of taxation
1. History and objectives of Canadian tax system
2. Structure and interpretation of the Income Tax Act
3. Income tax research and reference materials
   a. Interpretation Bulletins, Information Circulars, Advanced Tax
      Rulings and Case Law
4. Liability for income tax and residency
   a. Concept of residency, deemed resident, part-year resident
   b. International Tax Treaties
5. Tax evasion, tax avoidance and tax planning
6. Computation of net and taxable income
7. GST/HST considerations

Learning Outcomes: 1, 11

Module 2: Income or loss from an office or employment
1. Employed versus self-employed
2. Inclusions:
   a. Salary, wages and other remuneration
   b. Board and lodging
   c. Automobile benefits
   d. Allowances
   e. Employment insurance benefits
   f. Loans to employees
   g. Stock option benefits
   h. Other Fringe benefits
      i. GST/HST on taxable benefits
3. Deductions and limitations
   a. Salespersons
   b. Travel and motor vehicle
   c. Automobile
   d. Home office

Learning Outcomes: 2,3,7,10,11

Assessment:  IN-CLASS ACTIVITY #1 (3%) 
ASSIGNMENT 1 (10%) 

Module 3: Income or loss from a business
1.  Types of income-business income, property income, capital gains
2.  Sole proprietorship
3.  Inclusions
4.  Deductibility of expenditures
5.  Prohibited deductions
6.  Permitted deductions
7.  Sales person¿s expenses
8.  Professional business
9.  Scientific research and experimental development
10. Reconciliation schedule
11. GST/HST considerations

Learning Outcomes: 2,3,7,10,11

Assessment:  IN-CLASS ACTIVITY #2 (3%)  

Module 4: Capital cost allowance and eligible capital property
Topics included, but not limited to the following:
1. Basic rules of capital cost allowance system and comparison with
   accounting rules
2. Capital cost allowance classes
3. Acquisition of depreciable property
4. Additions to capital cost
5. Dispositions of depreciable assets
   o Terminal loss
   o Recapture
6. CCA schedule
7. Special rules for CCA determination
   o Net half-year rule
   o Passenger vehicle ¿ luxury
   o Short taxation year
   o Available for use rule
   o Inducement payments
   o Disposition of land and building
8. Treatment of eligible capital property
9. GST/HST considerations

Learning Outcomes: 4,7,11

Assessment:  IN-CLASS ACTIVITY #3 (3%)

MID-TERM EXAM 20% (Modules 1-4)

Module 5: Income or loss from property 
1. Comparison with business income
2. Inclusions
   a. Interest
   b. Dividends
   c. Rent
   d. Royalties
   e. Income attribution
      i. Transfer of property to spouse
      ii. Transfer of property to children
      iii. Income splitting and attribution rules
   f. Shareholder benefits
3. Deductions
4. GST/HST and property income

Learning Outcomes: 2,3,7,10,11

Module 6: Compliance, administration, returns, assessments and appeals
1. Returns and payments
2. Assessment and notice of assessment
3. Interest and penalties, failures and omissions
4. Refunds and interest
5. Objections and appeal process
6. Books and records
7. Source deductions
8. GST/HST obligations

Learning Outcomes: 5,11

Module 7: Capital gains and capital losses
1. History, general rules, definitions and computation
2. Specific provisions
   a. Personal-use property
   b. Listed personal property
   c. Principal residence
   d. Options and convertible property
   e. Pooling of identical assets
   f. Exchange of property - replacement property
   g. Change of use - non-arm's length
3. Adjustments to cost base
4. Reserves
5. Business investment losses
6. Capital gains deferral
7. Consideration - FMV rules
8. Non-arm's length transfers
9. GST/HST considerations

Learning Outcomes: 2,3,6,10,11

Assessment:  IN-CLASS ACTIVITY #4 (3%)
             ASSIGNMENT 2-15%

Module 8: Income from other sources and other deductions
1. Other sources of income
   a. Pensions and retiring allowances
   b. Support payments
   c. Deferred income plans
   d. Other inclusions
2. Other deductions in computing income
   a. Registered savings plans
   b. Moving expenses
   c. Child care expenses
   d. Other deductions
3. Amounts not included in computing income
4. Net income for tax purposes

Learning Outcomes: 3, 7, 10, 11

Assessment:  IN-CLASS ACTIVITY #1 (3%)

Module 9: Taxable income and taxes payable for individuals
1. Computation of taxable income
   a. Employee stock options
   b. Home relocation loans
   c. Miscellaneous receipts 
   d. Loss carryovers
   e. Capital gains deduction
   f. Ordering of deductions
2. Computation of tax payable
   a. Tax rates
   b. Non-refundable tax credits
   c. Refundable tax credits
   d. Transfer of tax credits
   e. Foreign Tax Credits
   f. Political contributions credit
   g. Tax on split income
   h. Minimum tax

Learning Outcomes: 7, 8, 9

Assessment:  IN-CLASS ACTIVITY #5 (3%)

FINAL COMPREHENSIVE EXAM 40% (Modules 1-9)