Income Tax Assignment
Prepare an individual income tax return for the year 2016 using the specific 2016
When you access Cantax, follow this path to turn off the validation feature for the SIN (Social Insurance Number) that you will be using in this assignment. The SIN you are being provided for this assignment is not a valid SIN; to continue with the tax return, turn off the validation feature at: Options; Preferences; Settings: General; remove Validate SIN (if it is checked), OK.
The Help file within the program can be accessed to help you regarding the software. You will first complete the T1-Information screen: This is not a return for EFILE nor is it a discounted return. This is not your first tax return.
This tax return will be prepared in your name. You are single and a resident of Ontario; you were born on May 26, 1989; and your social insurance number is 682 714 926. You live at 1450 Nakina Drive, Thunder Bay, ON. P7C 4W1. Your home phone number is 807-475-6110. Your email address is [email protected]. You did not dispose of a principal residence in 2016. Your home address is the same as your mailing address. Yes, you are a Canadian citizen and you do consent to the National Register of Electors.
Only complete the T1-Information fields for which you have been provided data in this assignment. Leave the other fields blank or accept the response provided by the software program.
You are currently not registered for the My Account online service but are authorizing the CRA to register you for that service.
Explore the Menu Buttons along the top of the screen by resting your cursor over any button. If you click on the button "Go to Form", it will take you to the Jacket of the return, which is the actual four page tax return. As you work with each new page (whether within the four pages of the jacket, or any page of the schedules), a tab will appear for that page under the menu buttons. Each page has its own tab. You can easily go back to a page you've been working on by clicking on the appropriate tab.
Leave tabs open when you submit your assignment.
Any field containing a magnifying glass is expandable. In other words, to enter data into this field, expand the field (by double-clicking the field) and another window will be provided where you can enter the data required (unless it, too, contains a magnifying glass, in which case, you will have to expand the field further).
It is recommended that you save your work to the J Drive or a memory stick-equivalent as you work through the assignment.
Any carry-forward balances from your 2015 tax return are nil.
A T4 for yourself is provided as part of this assignment. Report the appropriate information from this T4 on the T4 page of your tax return (accessed by expanding the Employment Income field - a couple of times - from page 2 of the jacket of your tax return).
In addition to the T4 you have Other Employment Expenses. You paid $332 in legal fees this year to recover part of your salary that was in dispute with your employer.
You have lost your T5 information slip from Best Investments Ltd. but will complete Schedule 4 regardless, entering the correct amounts. You did receive a cash dividend of $184 from this public corporation in 2016. You will use the current textbook percentages for dividend gross-ups.
You sold 900 common shares of XYZ Corporation, a publicly-traded company for $22 per share in 2016. Your transaction fees amounted to 0.20% of your proceeds. You purchased these shares in 2010 for $7 per share.
You also run a part-time dog-walking business out of your home. (Expand on Box 162.) (Ignore HST.) Woof Walks has been in existence for two years. In 2016, the business's gross revenues were $8,110. Expenses included $446 for advertising, $165 for licensing, $89 for office expenses, and $507 for supplies (all consumed during 2016). You will be using T2125 to report your business income. (Multiple pages will open, each as a separate tab.) The business number is 001122234PA5566; leave the industry Code blank. After completing the first page of T2125, continue with the other pages, completing areas that are applicable to your business. You are not claiming any business-use-of-home expenses. You are not claiming any motor vehicle expenses since all of your clients are within walking distance. Your business did purchase a custom-built safe for the storage of your customers' house keys; the cost of this safe, purchased on March 10, 2016, was $795.
Access Schedule 1 (calculation of federal tax and tax credits) through an expansion of field 420 on page 4 of the jacket of your tax return.
You have $420 in eligible Thunder Bay public bus transit passes for 2016.
During 2016, you gave $700 to the Princess Margaret Hospital Foundation for seven of their lottery tickets. (You're hoping to win the custom-built Muskoka cottage!) During 2016, you also made donations of $1,360 to Amen Believer's Church (a registered charity recognized by the CRA). This is NOT the first year that you have made charitable donations.
You will only be addressing the federal income tax component of your tax return in this assignment. You will not be adjusting the Ontario income tax calculations nor will you be taking advantage of any Ontario tax credits other than those calculated by the software program.
Attachment:- T4.rar