For the year ending December 31, 2015, PensCorp Inc. had Net Income for Tax Purp
ID: 2493596 • Letter: F
Question
For the year ending December 31, 2015, PensCorp Inc. had Net Income for Tax Purposes of $300,000. This amount included $10,000 in dividends received from taxable Canadian companies, as well as $15,000 in net taxable capital gains. The Company also made charitable donations during 2015 of $15,500.
At the beginning of 2015, the Company had a non-capital loss carry forward of $90,000, as well as a net capital loss carry forward of $50,000.
Determine the Company’s minimum Taxable Income for the year ending December 31, 2015 and the amount and type of any carry forwards available at the end of the year.
Explanation / Answer
Solution.
Computation of minimum Taxable Income of the company for the year ending December 31,2015 and amount and type of any carry forwards available at the end of the year:
Net Income for Tax Purpose 300,000
Less: Dividend received (10,000)
Less: Charitable donation (15,500)
Less: Non Capital Loss (90,000)
Less: Capital Gain (15,000)
(50,000-15,000)35,000 Carry forward
Taxable Income 169,500
Carry forward capital loss 35,000