Tax - Ch4 Solutions

Tax - Ch4 Solutions - CHAPTER 4 INCOME FROM EMPLOYMENT K C...

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CHAPTER 4 INCOME FROM EMPLOYMENT KC 4-2 [ITA: 6(1)(a), 6(4) – Taxable benefits] Mike must include $2,100 in his income for tax purposes. Employer-paid premium for life insurance coverage [ITA 6(1)(a), 6(4)] $ 400 Club membership dues, not principally for the employer’s benefit [ITA 6(1)(a), T4130 page 23]. Public transit pass 900 800 $2,100 The following benefits are excluded from income for tax purposes: Employer’s contribution to the RPP [ITA 6(1)(a)(i)] Employer-paid premium for group sickness or accident insurance coverage [ITA 6(1)(a)(i)] Employer-paid premium for a private health insurance plan [ITA 6(1)(a)(i)] and Counselling services for mental health for Mike or his relatives, paid for by his employer [ITA 6(1)(a)(iv)]. KC 4-7 [ITA: 7(1.1), 110(1)(d.1)] The difference is in the timing of the recognition of the employment income. In KC 4-6, the stock option benefit was recognized when the shares were purchased. In KC 4-7, the stock option benefit is recognized when the shares are sold. The value of the benefit
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Tax - Ch4 Solutions - CHAPTER 4 INCOME FROM EMPLOYMENT K C...

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