Canadian Corporate Tax
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  I: Administrative Information   II: Course Details   III: Topical Outline(s)  Printable Version
Section I: Administrative Information
  Total hours: 42.0
Credit Value: 3.0
Credit Value Notes: N/A
Effective: Spring/Summer 2009
Prerequisites: (ACCG50102) AND (APPL50082)
Corequisites: N/A
Pre/Co/Equiv Notes: N/A

Program(s): Accounting in Canada
Program Coordinator(s): Sally Mitzel
Course Leader or Contact: Lorraine Cipparrone
Status: Approved (APPR)

Section I Notes: N/A

Section II: Course Details

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

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.

Course Critical Performance and Learning Outcomes

 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 

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 

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.

Evaluation Plan
Students demonstrate their learning in the following ways:

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%
Section III: Topical Outline
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
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)          

      Installment payment          Publisher Online 
      obligations for Canadian     Learning Centre:
      corporations.(LO 2,11)
      Tax planning considerations  Lecture materials
      (LO 10)                      In-class exercises

      Determining business income: 
      (LO 3, 11)
       -Definition of business income
1(b)  Determining business income: Text:Chapter 5
     (LO 3, 11)          
       -6 general limitations
        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               Module 
       -Scientific research    1 due 
       -Reserves                   olc/buckwold          (4%)
       -Unpaid remuneration        Lecture materials
       -Tax planning               In-class exercises
     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
       -calculation of CCA
        and UCC                    olc/buckwold
       -acquisitions and           Lecture materials
        disposals                  In-class exercises
       -gains and losses               
       -terminal losses and recapture  
       -special treatment of certain 
       -exceptions to declining 
        balance method	

3(a) Capital cost allowance:        Text:Chapter 6       Research
     (LO 4, 10, 11)               Project:
       -eligible capital property   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        Research
      -reconciling accounting    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                  for
      -Losses                 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          Project:
     shareholders (LO 6,10,11)    Module
      -Integration of personal      /olc/buckwold        4 due(4%)
       and corporate income         Lecture materials
       taxes                        In-class exercises 
      -Tax planning

    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)     
      -Small business deduction
      -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       
     (LO 8, 10,11)        
      -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)        RETURN
      -access to the small business    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:
     Review for Final test	                         3,4,& 5
	                                                 due for
                                                         groups (5%)

7(b) FINAL TEST Chapters                                 FINAL TEST 
     9,11,12,13                                          (25%)
     (LO 5,6,7,8,9,                                           

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